CH 3 - Customer Relationship Management A Databased...

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Unformatted text preview: Customer Relationship Management A Databased Approach V. Kumar Werner J. Reinartz Instructor’s Presentation Slides Chapter Three Strategic CRM Topics Discussed • CRM Perspectives • The Components of Strategic CRM • Steps in developing a CRM strategy • Case Study: CRM Implementation at International Business Machines, Inc. (IBM) CRM Perspectives • CRM at the Functional level – Set of processes to execute marketing functions like sales force automation or mktg. campaign management • CRM at the Customer-facing level – Set of activities that provide a single-view of the customer across all contact channels – Customer intelligence obtained is available across all customer-facing functions • CRM at the Organizational level - Strategic CRM – Knowledge about customers and their preferences have implications for the entire organization Strategic CRM Strategic CRM • Successful strategic CRM is a complex set of activities that together form the basis for a sustainable and hard-to-imitate competitive advantage • Shapes interactions between company and customers to allow maximization of lifetime value of customers • Recognizes differences between customers with respect to their economic value to the firm as well as their expectations from the firm 4) CRM Strategy Implementation Components of CRM Strategy 2) Integration and alignment of organizational processes 1) Customer-Management Orientation 3) Information capture and alignment of technology Customer Management Orientation • Defined as the set of organizational values, beliefs, and strategic actions that enable the implementation of customer management principles • Characterized by a top management belief and commitment that the customer is at the center of activity • Recognizes that customers are heterogeneous in needs and value to the firm and reflects a readiness to treat different customers differently • Considers the fact that a longer-term view of revenues from customers needs to be taken into account Case Study: CRM Business Model - Capital One • Capital One in Falls Church, Virginia, one of the fastest growing financial corporations in the U.S., was founded in 1988 and has witnessed phenomenal growth. How? • Business model founded on the premise that – Every customer carries a specific and unique credit risk and potential revenue profile, which determines his risk-return profile from the company’s point of view – The better the company can understand and assess a customer’s specific risk, the better it can manage it CRM Business Model - Capital One ( contd.) – The better the company understands the customer, the more it can tailor its products to his needs – Thus, low risk and high returns for the company on the one hand, and high satisfaction for the customer on the other hand can ideally go hand in hand – Management and employee evaluation is, amongst others, tied to customer retention and customer profitability measures Integration and Alignment of...
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This note was uploaded on 11/09/2011 for the course MAR 08 taught by Professor Staff during the Spring '08 term at Youngstown State University.

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CH 3 - Customer Relationship Management A Databased...

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