CRM STRATEGY & PLANNING

CRM IMPLEMENTATION

Implementation Projects

Operational Projects Analytical Projects

Application Projects
> Deploying Operational and Analytical Outputs
OPERATIONAL PROJECTS
Objectives:
 Construct infrastructure meeting technical and functional requirements of CRM

 Don’t directly generate revenue, but provide resources to perform value-added CRM Projections

 Maximize profitability

 Reduce support costs

 Increase sales and customer loyalty

COMPONENTS OF CRM INFRASTRUCTURE
Component Description

Information Delivery/Online Capability to display and list the company’s products and services online
Catalogs

Customer Database Capability to capture, organize, present, and analyze customer-specific data, in order to identify sales
opportunities and address product development and delivery requirements

Personalization and Content Utilizing results of data analysis to create an individualized experience for the customers and
Management enhance/modify service delivery vehicles to match the specific needs of customers (based on their user
profiles)

Sales Force Automation The deployment and use of tools and services designed to automate the sales and marketing lifecycle

Partner Channel Automation The deployment and use of tools and services designed to integrate a company’s service vehicles with
those of its provider and third-party partners

Customer Services The deployment and use of technology and business processes designed to successfully support a
company's products and services
ANALYTICAL PROJECTS
Also called Data Analytics

Leverages resources created by operational projects

Adds value by enabling firms to understand their customers

Helps determine customer strategy and development of on-going CRM strategy

Major activities:
 Capturing all relevant customer information – data sourcing
 Customer data transformation - data warehousing, data integration
 Customer knowledge discovery - data analysis, prediction based on results
ANALYTICAL PROJECTS - CAPTURING ALL RELEVANT
CUSTOMER INFORMATION
Significant challenge to many companies (legacy systems, availability)
> Tradeoff: Comprehensiveness vs. efficiency

Key steps in building a CRM database

(1) Data integration and standardization

(2) Real-time updating of customer information

(3) Incorporation of external sources of information

(4) Evaluation of customer-related back office data

(e.g. shipment or billing information for profitability analysis
ANALYTICAL PROJECTS - CUSTOMER KNOWLEDGE
DISCOVERY
Data analysis of customer base
 Analysis of customer demographic
 Analysis of psychographic information (e.g. survey results on customer satisfaction, loyalty, attitudes)
 Analysis of actual behavior (e.g. customer transaction history or customer service records)

> Define customer segments to form basis for differential marketing decisions

Prediction of future purchase behavior

 Model a behavior pattern for specific customers and predict future behavior

Customer Value Assessment

 Focus resources on most valuable customer relationships
DEPLOYING OPERATIONAL AND ANALYTICAL OUTPUTS
No value will be created until this system and the information are applied and utilized to improve the
company's marketing decision making and the company's relationships with its customers

Examples:
 Using the analytical results of customer value assessment and customer profiling helps design marketing
campaigns that target the customers or prospects that are most likely to respond and that provide a
high expected value.
 Products or service can be customized based on customer behavior modeling and customer
segmentation to meet their unique expectations
 The planning and forecasting of sales, marketing, and customer service can be improved based on
customer life-cycle patterns (engage, transaction, fulfill, and service) to make the sales and marketing
efforts more focused and efficient
ROI OF CRM
Formula: Profits/Investment X 100% = ROI (%)

Is the investment in CRM elements worth it?

 The practice of developing and implementing a CRM system should always measure the expected
monetary benefits to see if the investment is likely to payoff.

Key questions when ROI is applied in the context of CRM

 What should be counted as an investment in CRM?

 What should be counted as a return on that investment?

 What is the time period over which ROI should be measured?

 How do we arrive at the ROI estimate?

CONTINUE..
Questions on what can be counted as investment in CRM?

 Can the system be easily configured and maintained by internal IT staff or is continuous external
assistance required?

 What is the cost of training the company’s staff to use the CRM system?

 What is the timeframe for implementation and what will happen to the current system processes during
that time?

 What are recurrent costs?

CRM COSTS
IT Costs

People Costs

Process Costs
CRM DONE RIGHT
Common threads among companies successful in implementing CRM:

• Pragmatic and disciplined approach to CRM

•Launching highly focused projects (Narrow scope and modest goals)

•Investment to clearly define problems

 CRUCIAL QUS TO BE ASKED BEFORE LAUNCHING CRM
INITIATIVES
•Is it Strategic?

•Where does it hurt?

•Do we need perfect data?

•Where do we go from here?

SUCCESFUL CRM IMPLEMENTATIONS: COMPANIES

1. Aviall: Aircraft parts distribution

2. Kimberly-Clark: Consumer Products
3. Ingersoll-Rand: Diversified equipment
4. Brother International: Office machine
5. Molex: Electronic connector