Consolidated CRM Study Material

PPTs Aggregated

1/12/2009

CRM basics right upto Marketing Plan and Campaign Management ; Analytics Excluded

Table of ContentsDefinition of CRM...........................................................................................................................5

Emergence of CRM.........................................................................................................................5

What is Market-Driven CRM?........................................................................................................5

Kotler’s Definition on CRM............................................................................................................5

Relationship Marketing...................................................................................................................6

Relationship marketing, CRM & customer management – a hierarchy..........................................6

7 S Framework.................................................................................................................................7

Classification of CRM.....................................................................................................................7

CRM Strategic Framework..............................................................................................................8

Some important Transaction Cycles................................................................................................9

Customer Segmentation.................................................................................................................10

CRM - Building Blocks.................................................................................................................11

CRM Marketing.........................................................................................................................11

CRM Sales.................................................................................................................................11

CRM Service.............................................................................................................................11

CRM e-Commerce & Web Shop...............................................................................................11

M-Plan & Campaign......................................................................................................................12

Business Objective.....................................................................................................................12

Goals of Marketing / Campaigns...............................................................................................12

Marketing and Campaign Planning...........................................................................................12

Marketing Plan – The Marketing Calender & Marketing Planner............................................13

M-Plan : What it is and What it does.........................................................................................13

Campaign : : What it is and What it does..................................................................................13

Types Of Campaigns.................................................................................................................14

Campaign Automation...............................................................................................................14

Campaign Analysis....................................................................................................................14

Campaign Execution / Activity Management............................................................................14

Activity generation from target group.......................................................................................14

Campaign Success Analysis- Example......................................................................................15

Analysing Data Flows - Closing the Loop................................................................................15

Difference between M-Plan & Campaign.................................................................................15

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List of Figures

Figure 1 : Relationship Marketing.................................................................................................5

Figure 2 : Hierarchy of Relationship Marketing...........................................................................5

Figure 3 :The 7S Framework.........................................................................................................6

Figure 4 : CRM Strategic Framework.............................................................................................7

Figure 5 :Closed-loop interaction cycle...…………………………………………………………………………..7

Figure 6 :Customer Order Fulfillment Cycle.................................................................................8

Figure 7 : Sales Order Cycle................................................................................................................7

Figure 8 : Lead to Sales Transaction.............................................................................................8

Figure 9 : Lead Processing............................................................................................................7

Figure 10 : Opportunity Success Steps..........................................................................................8

Figure 11 : Sample Questionnaire.................................................................................................9

Figure 12 : Example of a Document Flow.....................................................................................9

Figure 13 : Marketing and Campaign Planning.............................................................................11

Figure 14 : Example of a Typical Marketing Plan........................................................................11

Figure 15 : M Plan & Campaign Overview...................................................................................12

Figure 16 : Analysing Data Flows - Closing the Loop..................................................................14

Figure 17 : Difference between Marketing Plan & Campaign......................................................14

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CRM Concepts & Functional Aspects

Definition of CRM

There are many perspectives and definitions of CRM. At its most simple, CRM could be thought of at three levels:

CRM is about the implementation of a specific technology solution projectCRM is the implementation of an integrated series of customer-oriented technology solutionsCRM is a holistic strategic approach to managing customer relationships in order to create shareholder value

Emergence of CRM

The emergence of CRM as a management approach is a consequence of a number of important trends. These include:- the shift in business focus from transactional marketing to relationship marketing- the realization that customers are a business asset and not simply a commercial audience- the transition in structuring organizations, on a strategic basis, from functions to processes- the recognition of the benefits of using information proactively rather than solely reactively- the greater utilization of technology in managing and maximizing the value of information- the acceptance of the need for trade-off between delivering and extracting customer value- the development of one-to-one marketing approaches.

What is Market-Driven CRM?

Market driven CRM is all about- Strategy, no more tactics- Customers, no more companies- Process, not only a software- Outcomes, not only outputs- Long-term, not short-term, views

What has changed over the past decade is a series of significant trends that collectively shape the opportunity better to serve customers through information-enabled relationship marketing, or CRM

Kotler’s Definition on CRM

- The consensus in…business is growing: if…companies are to compete successfully in domestic and global markets, they must engineer stronger bonds with their stakeholders, including customers, distributors, suppliers, employees, unions, governments and other critical players in the environment. Common practices such as whipsawing suppliers for better prices, dictating terms to distributors and treating employees as a cost rather than an asset, must end. Companies must move from a short-term transaction-orientated goal to a long-term relationship-building goal.

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Relationship Marketing

Figure 1 : Relationship Marketing

Relationship marketing emphasizes on two important issues- optimize relationships with customers if you understand and manage relationships with other

relevant stakeholders.- the tools and techniques used in marketing to customers, such as marketing planning and market

segmentation, can also be used equally as effectively in managing non-customer relationships.

Relationship marketing, CRM & customer management – a hierarchy

Figure 2 : Hierarchy of Relationship Marketing

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7 S Framework

Figure 3 :The 7S Framework

Classification of CRM

Analyst firms classify CRM into several types:- Operational CRM- Analytical CRM- Collaborative CRM

Other terminology used in the CRM market includes- Strategic CRM- e-commerce CRM- Partner relationship marketing or PRM

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CRM Strategic Framework

Figure 4 : CRM Strategic Framework

Process 1: the strategy development process- Where are we and what do we want to achieve?- Who are the customers that we want and how should we segment them?

Process 2: the value creation process- How should we deliver value to our customers?- How should we maximize the lifetime value of the customers we want?

Process 3: the multi-channel integration process- What are the best ways for us to get to customers and for customers to get to us?- What does an outstanding customer experience, deliverable at an affordable cost, look like?

Process 4: the information management process- How should we organize information on customers?- How can we ‘replicate’ the mind of customers and use this to improve our CRM activities?

Process 5: the performance assessment process- How can we create increased profits and shareholder value?- How should we set standards, develop metrics, measure our results and improve our

performance?

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Some important Transaction Cycles

Figure 5 :Closed-loop interaction cycle Figure 6 :Customer Order Fulfillment Cycle

Figure 7 : Sales Order Cycle Figure 8 : Lead to Sales Transaction

Figure 9 : Lead Processing Figure 10 : Opportunity Success Steps

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Figure 11 : Sample Questionnaire

Figure 12 : Example of a Document Flow

Customer Segmentation

- Customer segmentation used to be ‘mass market’ and ‘key customers’. - With data warehousing solution, we are now better able to analyze each customer’s use of

different services, as well as an individual’s total net worth to the organization. - We can understand the profit and costs associated with each customer, which means better,

more customized services for customers and increased profitability for the organization.- Customer profiles/models are then created and used to feed information into campaign

management software.

Generally Accepted Ways of Customer Segmentations

- Attributes (e.g. Hobbies)- Information Sets (e.g. Postal Code)- Data History (e.g. past Sales History)- External List data

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CRM - Building Blocks

CRM Marketing

Marketing Plan Campaign Management Consumer & Trade Promotion Analysis and Reporting

CRM Sales

Sales Order Management Cross and Up Selling in CRM Listing and Exclusion Order to Billing Cycle Overview in CRM

CRM Service

Service Order Management Installed Base Management Complaints & Return Warranty Claims & Case Management CRM Customer Interaction Centre

- Principles of an Interaction Centre- CIC Setup and Management

CRM e-Commerce & Web Shop

Web-shop Setup Order and Contract Management E-Sales Scenarios of the Industry Available to Promise (ATP)

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M-Plan & Campaign

Business Objective

Goal: Increase business across multiple interaction channels - telephone, direct mail (Fax, E-mail, print)

To achieve goal, set up:- Marketing plan and campaigns- Direct mail forms- Target groups- Product proposals (Top-N list, cross-selling rules)

Goals of Marketing / Campaigns

Drive revenue growth while managing costs. But How ???

Bring the right product to the right customer via the right contact channel and / or person at the right time with a personalized approach and control marketing costs

Marketing and Campaign Planning

Figure 13 : Marketing and Campaign Planning

Figure 14 : Example of a Typical Marketing Plan

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Marketing Plan – The Marketing Calender & Marketing Planner

Marketing Calendar

- Marketing planning structure (e.g. long-term planning, campaign hierarchy, activities)- Time frames- Budget and revenue planning- Monitoring

The Marketing Calendar gives an overview of all marketing projects within a certain time range.

The Marketing Planner offers a hierarchical view.

Figure 15 : M Plan & Campaign Overview

M-Plan : What it is and What it does

A marketing plan is used for strategic marketing planning, that is, for planning a concrete marketing concept.

This way budgets and deadlines are taken into consideration.

A marketing plan could form, for example, the basis for next year’s costing in the marketing department.

It is a management tool.

You can use any number of marketing plan elements to structure a marketing plan in the form of a hierarchy.

You can assign one or more campaigns to each marketing plan.

Campaign : : What it is and What it does

Campaigns serve as operative marketing planning. They describe actions that are carried out, such as mailing actions, product promotions, and

telemarketing.

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For these activities, the following, for example, are defined in the campaign: - target groups, - products, - documents, - person responsible,- budget.

Campaigns are used for operative marketing planning and execution. Campaigns can be broken down into campaign elements. You can only assign campaigns elements to campaigns.

Types Of Campaigns

Consumer Campaigns- Targeted to end customers / consumers- Example of Mass-Campaign

Trade Promotion management- Targeted to B2B customers- Can be individual as well as mass campaign

Campaign Automation

- CA is one of the key feature in Campaign execution.- CA helps in reducing time of execution- CA helps in auto-generation of vendor PO- CA helps in regulating budget

Campaign Analysis

Use of the data warehouse or other elements of the data repository

Standard data mining- visualization: histograms, bar charts, line graphs, scatter plots, box plots- clustering/segmentation, prediction, deviation detection etc- neural networks (computer aided statistical tool e.g COGNOS) and decision trees.

Task-specific analysis tools- Market segmentation analysis- Affinity grouping- Churn management- Customer profiling- Profitability analysis

Campaign Execution / Activity Management

Executing campaigns across all customer touch points- Web- Tele- E-mail- Print mail- Fax

Activity generation from target group

Multi channel Execution via third party

- Telemarketing outsourcing- Mail shops

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Campaign Success Analysis- Example

Planned costs via CRM

Actual costs via integration to ERP (SAP R/3, etc.)- CRM Campaign <--> ERP Project System- Invoices- Variable Costs (mailing, labor)- Fixed Costs (Administration)

Campaign Success- Response rate (CRM Execution)- Success rate: revenues generated (sales orders - CRM /R/3)

Analysis via integration to BW- Planned Costs (CRM)- Actual Costs (R/3)- Revenues generated (CRM / R/3)

Delivered through standard Business Content

Analysing Data Flows - Closing the Loop

Figure 16 : Analysing Data Flows - Closing the Loop

Difference between M-Plan & Campaign

Figure 17 : Difference between Marketing Plan & Campaign

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