Customer Relationship Management

Sharon Crost enthusiastically leads a role in the worlds of Enterprise and Entrepreneur. In the Enterprise world, Sharon has worked for the large companies of IBM and Hewlett-Packard in Finance, Marketing and Information Technology. Her passion for the hi-tech world and flair for working with international clients has led her to positions from managing business finances to managing business system projects, to consulting on enterprise systems, to managing international marketing programs to managing international technology and e-business teams. As an entrepreneur, Sharon has started up two diverse small businesses in the U.S. - a customized travel service and an organic vegetable farm. Sharon's appreciation of the mountains has brought her to Grenoble, France where she currently works as an independent consultant.

Class ScheduleTo Be Finalized

Presentation of Course -Outline

CRM Overview – What is CRM– CRM as a Business Tool– Strategic CRM

Technology – Technology Framework– Infrastructure Alternatives

Managing CRM projects and Follow-up – Analyzing the data– Measuring Results– Ongoing improvement

Applying CRM to business cases and student projects – Applying CRM and Review– Student Projects– Course Discussion/evaluation

Presentation of Course (style) ACTIVE! Interactive discussion Cases to apply learning Practical vs. Theoretical Instructor – ideas, facilitation, resources

Presentation of Course – evaluation

Individual evaluation based on student participation and understanding of CRM concepts

CRM Student Project Business Objective CRM strategy to meet the business

objective Infrastructure and Process

supporting the CRM strategy Ongoing Management of the

program Business Results and Follow-up

Introductions

Using « post-it » paper list three of each:

What I know about CRM– (3 thoughts on 3 separate pieces of paper)

What I want to know about CRM – (3 thoughts on 3 separate pieces of paper)

Discussion Case #1 – computer online

Michael Shmichael is purchasing a personal computer from HAKR Computers Online. Describe the customer’s purchase experience, the vendor’s sales experience and the relationship between customer and vendor

Discussion Case #1 – computer online

Customer Perspective Select the Product

– quality, price, availability, functionality Purchase Product

– easy process, quick delivery, online delivery info, payment terms

Use and Learn– assemble parts, instructions, features, new

information, upgrades Ongoing Support

– technical support, sales support

Discussion Case #1 – computer online

Vendor Perspective Provide Product Information/Marketing

– quality, price, availability, functionality Efficient Purchase Process

– easy process, quick delivery, online delivery info, payment terms

Client Knowledge– repeat buy, product feedback

Revenues, Profit, Customer Satisfaction– return on investment, customer retention,

profit, customer share

Discussion Case #1 – computer online

Relationship – Customer and Vendor Product info

– web search, preferences, comparisons, pop-ups, live customer support, exclusive info

Purchases– online view, stored address info, auto

payments Shared Knowledge

– preferences, license or consumables info, Increased Customer Value!!!

– satisfied customer, loyalty, advocate, €€€€€

Definitions and Terms

CRM: the infrastructure and process that allows you to manage customer interaction and increase customer value and profit

General Terms e-commerce enterprise CRM (sometimes e-CRM) Front office/back office Operational CRM (front office – sales

force, call center) Brick-and-mortar companies Customer Touch point Sales Force Automation Up-selling

Marketing Terms Attrition/Churn Closed-loop marketing

campaigns Customer

profiling/segmentation B2B/B2C Campaign management opt-in/opt out permission marketing

Internet/Technology Terms Cookie Clickstream ASP screen pop cyberagents (animation) Data warehouse/data marts Data Mining (predictive

analysis) Integrated Database Automated Workflow

Analytical CRM Customer Value Measurement Affinity analysis (burgers/fries) Prospect qualification Next-sequential-purchase

analysis Churn analysis and prediction Propensity to buy modeling Customer segmentation Partner contribution

measurement Customer profiling

CRM conceptual model

Increased customer knowledge Increased

customer value Increased

operational efficiency and effectiveness

Increased customer loyalty and customer base

Increased Profits and satisfaction

CRM conceptual model

Increased customer knowledge

Increased customer value

Increased operational efficiency and effectiveness

Increased customer loyalty and customer base

Increased Profits and satisfaction

gather data

segment/profile

analyze data

customize and optimize offer

customize interaction

optimize programs

create targeted campaigns

create efficient infrastructure and process

divest unprofitable customers

create customer care programs

create feedback loop

Summary and Questions What you know about CRM Discussion on how CRM works CRM terms CRM conceptual model

CRM Business Cases Business Objective CRM strategy to meet the business

objective Infrastructure and Process

supporting the CRM strategy Ongoing Management of the

program Business Results and Follow-up

Discussion – Business Objective

How much are you willing to pay for customer satisfaction?

Discussion – CRM strategy to support business objective

Do you want a relationship with your vendors? Why or why not?

References www.crmcommunity.com www.crm-forum.com www.crmmagazine.com www.crm2002online.com www.searchcrm.com

Summary and Questions What you know about CRM Discussion on how CRM works CRM terms CRM conceptual model Business Objective CRM strategy

Discussion - Operational Process

You are the operations manager of a typical small manufacturing company. Describe your customer touch points and discuss how CRM could improve operational processes.

Customer Touchpoints

Delivery

Call Center

HotlineE-mail Direct Marketing

Store Purchase

Sales Rep Finance Survey Order Processing

Web Site

Feedback Processes

Business Operations

Marketing Finance

Sales

Call Center

Delivery

Orders

Partner

Mgmt

Purchasing

Activity Mgmt

Contact Mgmt

Campaign Mgmt

Call center analysis

Pricing

Configuration

Partner Analysis

Supplier Eval

CRM --- SCM --- ERP

Supply Chain Management

Customer Relationship Management

Enterprise Resource Planning

order entrydistributionprocurementproductionlogisticsinventoryfinance/acctghuman resources

demand planningmanufacturingplanning/schedulingsupply planninglogistics planningsupplier management

lead generationqualificationcustomisationquotation/cost mgmtorder processingdeliveryservice/supportmarketingcampaign management

Manage Business

Transactions

Supply products

or services

Customer Interaction

s

Contact Information - Example

Technology Framework - Discussion

You are the IT manager of a typical small manufacturing company. Describe your current technology infrastructure and how CRM could become a more valuable part of this infrastructure.

Logical Flow

Business Objective

Infrastructure

Processes &Outputs

Strategy to meet objectiveCustomer

Infrastructure Alternatives

Database

Data

Database

Data

Contact Management CRM system Call Center

CRM system

Infrastructure Alternatives

Integrated Data Warehouse

Application Server

Web Server E-mail Server

Data Mart

Data Mart

Data Mart

Data Mart

Data Mart

Data Mart

Analyzing CRM data - discussion

You are the CRM manager for HAKRs computers online and you have created a new CRM system to collect whatever data you need to increase the business profitability. Describe your data analysis methods.

Analyzing CRM data

Results Analysis

CurrentActivity

Predictive Analysis

Prospect qualificationAffinity analysis (fries

with burgers)Churn analysis and

predictionPropensity to buy

modelingCustomer profiling

Next-sequential-purchase analysis

Propensity to buyClickstream analysisCustomer Support

Revenue AnalysisChannel AnalysisCustomer Value

MeasurementCustomer segmentationPartner contribution

measurementCustomer profiling

Managing CRM projects - discussion

You are the project manager for a CRM project and you have just found out that the project will take 2 months longer than planned, and cost 200k euros more than planned. How do you explain this to your boss?

CRM project management

FunctionalityTime

Resources

Project Management Project Objective Task Outline: what, who, link tasks On Budget

Cost estimates, track cost to estimate On time

Time schedule, beginning, end, duration

Plan meets objective – measure results Risk Mangement

Measuring Results/Follow-up - discussion

You are the program manager for a CRM program and you need to present your results and next steps to your boss. What are good measures? What do you recommend for a follow-up?

SMART Metrics

Specific Measurable Actionable Relevant Timely

Follow-up

Closed-loop Milestones Risks and Risk Management Ongoing Process Future Advances

Summary and Questions What you know about CRM Discussion on how CRM works CRM terms CRM conceptual model Business Objective CRM strategy Operational Processes Technology/Infrastructure Analyzing data Managing Projects Measuring Results and Follow-

up

Trends Process and Infrastructure customer-

driven (not internally driven) CRM buy-in comes from the top of

the organization ROI needs to be justified (too much

hype) Long-term versus short term

strategic view Integration of information (versus

single function solutions) CRM is not just about the technology

Privacy/Legal Legal issues vary from country

to country Culture is a key consideration Seek legal advice and keep up

with changes Describe clearly your privacy

policy , and/or what you will do with the information, and hold true to your commitments

Class Project Select a company currently undergoing a CRM

project or with a business objective that can be solved with a CRM project

Creatively propose a CRM solution using the following framework:

– Business Objective– CRM strategy to meet the business objective– Infrastructure and Process supporting the CRM

strategy– Ongoing Management of the program– Business Results and Follow-up

Your project is to be presented/discussed on the last course day.

You are graded on the following:– demonstrate understanding or CRM concepts– your project meets the stated business

objective– project is organized, interesting, insightful and

creative

Project Notes discuss your assumptions describe customer touchpoints present proposed ROI discuss how the solution could

be managed using resources, timeframe and functionality

describe how your project aligns with CRM trends

show graphics of a proposed process flow or infrastructure

Business Case Practice You are the CRM manager of digital

cameras online and you need to increase your sales by 25% for the year 2003. You have a very large customer base and would like to be more efficient in getting and keeping customers? You have discovered that your competitors are starting to email new product info to clients. You have started using customer information databases but don’t yet have a campaign strategy. Describe the business objective, CRM objective and a creative CRM program to meet your business objective.

Business Case Study - HP

CeBit – March 2002, Germany>Larget Euro Tradeshow>Business and Technology Oriented>In person-attendance averages several hundred thousands (700 thousand this year)>German web team Antje Lindner

Executive Summary Business Objective: Increase awareness

of products, particularly new products leading to eventual increased sales

CRM strategy: create a closed-loop marketing campaign on the web:– segment customers– get more customers to the site– increase page views on the site– gather customer information– push product information to customers

Executive Summary (continued)

Infrastructure and Process:– create exciting web pages– audio streaming– local DJs to promote products– SMS newscast– create game to get registrations– database of customer info

Ongoing Management of the program:– program and marketing mgr involvement– technology support and review

Business Results and Follow-up:– Business results presented– presentation communicated and saved for next

year

Objective

Increase awareness of products, particularly new products leading to eventual increased sales

Increased awareness leads to increased sales Awareness can be leveraged to sales of existing products Excitement and creativity in the awareness-building can lead to increased customer excitement and value

CRM Strategy

CRM strategy: create a closed-loop marketing campaign on the web:

– segment customers– get more customers to the site– increase page views on the site– gather customer information– push product information to

customers

Segmenting Customers

>Pre-selected – those attending or interested in CeBit show>German Speaking Targeted (Germany, Austria, Switz)>Technology oriented> Early Adopters

Customer Segments

High Volume HardwareHigh Value OutsourcingCustomized Solutions (SAP)

Get more customers to the site

>Direct mail campaign>Advertising>Press Activity

Increasing Page Views

Create an informative and interesting website focused on the segmented customers

Gather Customer Information

Create a web game that interests customers and motivates them to submit customer information

Push Product Info to Customers

Create an innovative web radio streaming, using local DJs to talk about products as advocates and to push product info to customers

Mapping to Model

Increased customer knowledge

Increased customer value

Increased operational efficiency and effectiveness

Increased customer loyalty and customer base

Increased Profits and satisfaction

collect customer registrations

collect feedback from customers

collect info on which technique (web/radio/game) customers preferred

game to keep customers coming back

new interaction via web radio and game

positive customer experiences with company

closed-loop campaign (repeat next year)

leverage infrastructure

focus on those that “opt-in”

word of mouth to friends/ colleagues

establish new interactions

Ongoing Management of the program

Program manager and marketing mgr assigned to program with certain budget and agencies identified. Timeframe was critical (to be ready for CeBit) and was the most constrained criteria

Technology was optimized and functionality was based on time available. Technology support and review was available throughout the CeBit program

Results: websiteObjective: Page ViewsInformative, interesting

17927 15480

2447

104403

84358

20045

0

20000

40000

60000

80000

100000

120000

Februaryin Total

FebruaryGermanVersion

FebruaryEnglishVersion

March inTotal

MarchGermanVersion

MarchEnglishVersion

PageViews

Results: gameObjective: registrationsHigh Tech,Fun

14

894 1021

615 490 449 391

3758

1611

0

500

1000

1500

2000

2500

3000

3500

4000

Registered Users

Results: Web RadioObjective: ListenersInformative, relax

0

200

400

600

800

1000

1200

1400

09/03/

10/03/

11/03/

12/03/

13/03/

14/03/

15/03/

16/03/

17/03/

18/03/

19/03/

20/03/

21/03/

Total Number ofListenersEnglish

German

Results Results communicated Work materials saved for next

year’s campaign Data entered into customer

database Feedback saved for next year’s

campaign

Mapping to Model

Increased customer knowledge

Increased customer value

Increased operational efficiency and effectiveness

Increased customer loyalty and customer base

Increased Profits and satisfaction

collect customer registrations

collect feedback from customers

collect info on which technique (web/radio/game) customers preferred

game to keep customers coming back

new interaction via web radio and game

positive customer experiences with company

closed-loop campaign (repeat next year)

leverage infrastructure

focus on those that “opt-in”

word of mouth to friends/ colleagues

establish new interactions