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BGS Customer Relationship Management

Chapter 2 History and Development of CRM

Thomson Publishing 2007 All Rights Reserved

The Origins of CRM .

SAP.The Origins of CRM • • • • • • • • • • • • Relationship marketing Marketing research B2B relationships MRP. and ERP Customer contact centers Sales force automation Campaign management tools Web and channel integration Diffusion of PCs and analytical CRM Success of direct response marketing such as toll-free calling and direct mail Relational databases Industrial and services marketing .

Relationship Marketing and Relational Databases • Database construction is easiest for firms having frequent and direct customer interaction – It is most difficult for firms having infrequent and indirect customer interaction. – It is of intermediate difficulty for firms having frequent but indirect customer interaction or direct but infrequent customer interaction. .

Ease or Difficulty of Database Construction Customer Interaction Direct Indirect Intermediate Package Goods Companies Difficult Auto. Furniture Manufacturers Interaction Frequency High Level Of Difficulty Industry Level Of Difficulty Industry Easy Banks. Retailers Intermediate PC Store Low .

CRM: Why Now? • Advancements in computer and information technology • Substantial changes in the business environment .

Changes in the Business Environment Leading to Adoption of CRM • Increasing number of high-quality products • Erosion of effectiveness of the traditional 4 P’s • Changes in the pace of life • The Internet and multichannel usage .

Organizations’ Expectations Regarding CRM Success or Failure????? .

Challenges in Implementing CRM How the Many Barriers Can Be Overcome .

Three Major Ways to Overcome Barriers in Implementing CRM • – – – Through Communication Adopt a CRM philosophy Detail the benefits to all employees Top executive support • – – – Through Integration Business strategy should drive CRM IT and business managers must be integrated Customer data must be integrated • Through foresight relating CRM tactics to success factors in the industry .

Overcoming Barriers • The organization must adopt a relationship marketing philosophy across all functional areas. • The organization must detail and communicate the benefits of a CRM orientation to all managers and staff. • Top executive support must be obtained and maintained throughout CRM development. .

• Include both IT and business unit managers in CRM start-up teams. • If separate “quick-results” CRM projects are being implemented as opposed to an allencompassing CRM suite. then these separate projects must be integrated and functionally aligned.Overcoming Barriers • Business strategies must drive CRM development rather than the other way around. .

• Build a business case and conduct a business analysis before deciding on a CRM solution.Overcoming Barriers • Customer data must be integrated and maintained. . • Develop success metrics to assess the effectiveness of your CRM efforts.

Developing CRM from a Tactical Perspective • A checklist for customer service success – The importance of the customer contact center – Put process blueprints in place • Customer analytics – Use your databases more effectively – Segment and identify the value of segments – Build customer relationships • Product selection .

donors.Extending the Meaning of CRM? • Should colleges only focus on students? What about alumni. . manufacturers. and legislators? • Companies do not forget suppliers. distributors. and facilitating agencies.

Consumers today are savvy enough to realize there are different levels of service for different levels of loyalty. Not so -. . The former is not really due to CRM. Customers not in a company’s loyalty program feel like second-class citizens. and CRM should reduce the number of catalogues. 3. 3. Consumers are faced with too many 1:1 relationships. 2. Today’s collection of products and catalogues is mind-boggling. 4. Companies ask for more and more info but give little in return.Can CRM Create 1:1 Relationships that are Truly Viable? Point 1. 2. Consumers can opt-in or opt-out as they see fit. 4. Counterpoint 1.look at supermarkets and hotels.

Thank You .