ROI for a CRM initiative at GST

Pesented by-

Jappreet Singh

Kanika Razdan

Lalit khanna

MeetingRobert Davis – Teradata official

Mark Johnson - GST’s CFO

Erica Kolks – vice president of marketing

Greater Southern Telephone Established in 1903

Located in southeastern united states

Region’s 3rd largest incumbent local exchange carrier.

13 millions customers in 11 states,28000 employees and sales exceeding US$ 6 billion

Service menu included data and voice transmission capabilities, such as broadband data services and internet access, delivered over a digital network

TeradataTeradata , a division of NCR CorporationNCR was found in 1884John H.Patterson purchased National Manufacturing Company and

Renamed it as National Cash Register CompanySome of the products of were ranging from mechanical cash

registers ,advanced POS and data warehousing solutions as well as worldwide leaders in sales and shipments of ATMs

1974,name was officially changed to NCR corporation2002,annual revenues were US $6 billion and approximately 32,000

employees1991,AT&T acquired NCR for US$ 7.4 billion 1991,NCR purchased Teradata Corporation1997,NCR became independent company again, which lead to restructuring

of AT&T into 3 distinct companies:AT&T,Lucent Technologies, and NCR

CRMCRM should be viewed first and the foremost as the

organizational strategy to understand and influence

customer behavior through continues communication to

improve customer acquisition, customer retention and

customer profitability.

Right customer with the right offer, at the right time using

right channel.

CRM Need’sIn 2002 the market for CRM solution was estimated

to be $3.6 billion.

Compound annual growth rate of 37% from IDC and AMR data.

Customer service and support solutions provide real time customer understanding via inbound interaction

CRM SolutionCRM solution can be divided into two parts-

Operational CRMAnalytic CRM

Operational CRMOperational CRM solution focus on collecting and

managing customer interactions through the various touch points a firm uses for sale, service and support.

These touch points include-WebRetail outletsATM’sCall centerDirect mail

Analytical CRMIt helps companies gain greater knowledge of their

customer through the analysis and modeling of detailed data.

Analytical CRM provides a clear customer insight enabling the organization strengthen its relation with the customers and enhance to profitability.

Telecommunication IndustryFew terms in this industry-:

Take rate

Churn

Lift

CRM strategy for GSTA single Integrated view of the customer.

With help of the wide data marts provided by Teradata GST was able to have a integrated view of its customers.

With EDW they could access customer quickly but lacked the analytic view. And with the Teradata CRM solution could be a big answer to question.

Power of AnalyticsOperational CRM is typically only effective when

combined with robust analysis and planning tools.

Analytic tools enables managers to understand-Who the customer isRecognize patternsTrends in customer behaviorThen craft communication tailor to individual

customer needs.

Business Discovery ProposalStatement of Work(SOW)

SOW between Teradata and GST-

The process the teradata would follow when developing a specific solution

The would help GST in defining metrics for the ROI.

Findings Values

How many customers are considered relevant for proposed CRM program

13000000

What is annual growth target for relevant customer base 5%

How frequently GST run acquisition campaigns monthly

On average what it costs GST to contact 1 customer $5

Historically, what is the current average campaign take rate for acquisition campaigns by GST customers

3%

Currently, what is the average monthly revenue per GST customer for the relevant customer base

$42

What does Teradata propose as the anticipated increase in average monthly revenue per customer

20%

What is GST average incremental gross margin percentage on the goods and services offered through the campaign

40%

What is the approximate tax rate for the analysis 38%

What is GST appropriate required return for analysis 16%

What Teradata suggested as the anticipated lift in the acquisition campaign take rate

5%

Findings cont..For the growth of wireless accounts by 5%,company

would run monthly campaigns to acquire new customers

Focused on increasing mobile childrenEmphasis were laid to lower churn rate Teradata was given the contract .Teradata laid great emphasis on CRMTarget campaignsV.A.S

CRM Implementation Cost

Hardware- $ 1,500,000Software- $2,500,000Professional services- $1,000,000

Annual maintenance would be 12% of the list price for hardware and 18% of the list price for the software.

Key issuesProviding additional benefits like network capacity, fraud

detection, improved retention.

Developing the profile of an ideal new customer utilizing current customer data was highly risky.

Appropriate time for the analysis.

ConclusionGST as a big fish in the telecom industry must go

with this CRM solution which has been provided by Teradata.

Customers are the main focus in this industry and if going with best CRM solution in the market will increases the customer retention and more customer acquisition.

Thank you