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Managing customers for lifetime business
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- 2. Government; Officers, Field Officers,Extension officers, Project managers e.t.c School: coordinators, administrators commercial Organizations: Territory Manager, Relationship manager, Credit officers, District sales managers, Key account managers, Territory sales in charge e.t.c
- 3. Every business desiresrepeat business from its customers. This is the ultimate objective of every organisation; lifetime business gives the management ability to plan for the future. The only unique feature every organisation that is performing well is being able to grow and maintain the newly acquired customers. This is in order for the organisation to have a long-term perspective.
- 4. Trust- The willingnessto rely on the ability, integrity, and motivation of one company to serve the needs of the other company as agreed upon implicitly and explicitly. Value- The ability of a selling organisation to satisfy the needs of the customer at a comparatively lower cost or higher benefit than that offered by competitors and measured in monetary, temporal, functional and psychological terms. Salespeople must: Understand customer needs and problems; Meet their commitments; Provide superior after sales support; Make sure that the customer is always told the truth (must be honest); and Have a passionate interest in establishing and retaining a long- term relationship.
- 5. CRM‟s goal isto increase the opportunity by improving the process to communicate Right Customer: Manage customer relationships throughout their life cycle Realize customer potential by increasing “Share of Wallet” Right Offer: Efficiently introduce customer and prospects to your company and its products and services Customize you‟re offering for each customer Right Channel: Coordinate communications across every customer touch point Ability to communicate to customer‟s channel preference Capture and analyze channel information for continuous learning Right Time: Efficiently communicate to customers based on time relevance Ability to communicate with real or near-real time or traditional marketing
- 6. 1. Pre-relationship Stage Eventthat triggers a buyer to seek a new business partner. The Early Stage Experience is accumulated between the buyer and seller although a great degree of uncertainty and distance exists. 2. Development Stage Increased levels of transactions lead to a higher degree of commitment and the distance is reduced to a social exchange. 3. Long-term Stage Characterised by the companies‟ mutual importance to each other. 4. The Final Stage The interaction between the companies becomes institutionalized. The primary objective of customer relationship management is to enhance and optimize customer retention and loyalty.CRM systems are also useful in determining most loyal and profitable customers and reward
- 7. Understand Your TargetAudience Find Out Who Your Current Customers Are;demographics,pycograhics,ethnographic, buying habits Defining the Market for Your Product Generating Sales Leads; cold calling, networking,campions of your product,affiliate marketing,advertising
- 8. Sell More toExisting Customers; bundle products try the``up sell‟‟ offer inside information customer rewards free samples
- 9. 1. THE IDICModel 2. The Quality Competitiveness Index Model (QCI) 3. The Customer Relationship Management CRM Value Chain Model 4. The Payne‟s Five Forces Model 5. The Dasai et al /Conceptual Model 6. The Forrester Model 7. The Maturity Model
- 10. 1. THE IDICModel
- 11. Identifying who thecompanies‟ customers are and building a deep understanding of them. Differentiating their customers in order to identify which amongst them have most value now and which offer most for the future. Besides, the differentiation can allow the companies to devise and implement customer specific strategies designed to satisfy individually different customer need. The clients represent different levels of value to the company and they their needs are radically not the same from the enterprise. The customer differentiation task will involve an enterprise in categorizing its customers by both their value to the firm and by what needs they have. Interacting with them in order to ensure that companies understand customer expectations and their relationships with other suppliers or brands. Thus, companies must improve the effectiveness of their interactions with clients. Each successive interaction with a customer should take place in the context of all previous interactions with that customer. A conversation with a customer should pick up where the last one left off. Effective customer interactions provide better insight into customer‟s needs. Customizing the offer and communications to ensure that the expectations of customers are met. Indeed, the company should adapt some aspect of its behavior toward a customer, based on that individual‟s needs and value. To involve a customer in a relationship, a company needs to adapt its behavior to satisfy the customer‟s expressed needs. This might entail “masscustomization a product or tailoring some aspect of its service” (Peppers, Rogers and Dorf, 1999).
- 12. 2. The QualityCompetitiveness Index Model (QCI)
- 13. QCI are independentspecialists who assist blue chip companies in managing customers. They are both strategic theorist and foremost practitioners (Hewson et al, 2002). The QCI model shown. The above is described as a customer management model, omitting thereby the word “relationship”. At the centre of the model, they highlight a range of activities needed by companies to perform in perspective to acquire and retain customers. This model also features people performing processes and utilizing technology to assist in those activities.
- 14. 3. The CustomerRelationship Management CRM Value Chain Model
- 15. The CRM valuechain is a model which businesses can follow when developing their CRM strategies. This model had been developed by a range of SMEs such as IT, software, telecoms, financial services, retail, media, manufacturing, and construction. This model is built from strong theoretical principles and the practical requirements of business The main purpose of this model is, according to Buttle (2004), to ensure that the company builds long-term mutually-beneficial relationships with its strategicallysignificant customers. Thus, some customers are merely expensive to acquire and service. Buttle has identified four types of strategically significant customer (SSC) such as the;
- 16. 1. high life-timevalue customer that is a key SSC and the present day of all margins that might be earned in a relationship. He stated that tempting as it may be to believe, not all high volume customers have high LTV. If they demand JIT, customized delivery, or are in other ways costly to serve, their value may be significantly reduced. We know of one company that applied activity-based costing disciplines in order to trace process costs to its customer base as consequence the company re-engineered its manufacturing and logistics processes, and salespeople negotiated price increases 2.The second group of SSC are “benchmarks” that are customers that other ones copy. For instance, a manufacturer of vending machine equipment is prepared to do business with any company because “they can tell other customers that they are supplying to the world‟s biggest vending operation” (Buttle, 2000). 3.The third group of SSCs are customers „inspirations‟. They are the ones that find new applications, “come up with new product ideas, find ways of improving quality or reducing cost. The may be the most demanding of customers, or frequent complainers, and though their own LTV potential low, they offer other significant sources of value”. 4.The fourth one deal with what Buttle (2004) calls “cost magnets” relating to those that absorb a disproportionately high volume of fixed cost, thus enabling other, smaller customers to become profitable
- 17. John Stevenson (2007),asserts that the CVC includes four stages: a. Grouping customers in order to determine which of customers are most profitable. The result the companies should seek is their target customer base. They should rate and segment their clients into groups that are most desirable to do business with they meet their criteria for what a desirable customer is. This is called, according to Stevenson (2007) the Customer Portfolio Analysis. b. The customer intimacy. Having found the segments the firms want to pursue, they need to get to know the ones in that segment very well and better than their competition knows them. Briefly, they want to appear that they know them intimately by, for example, in knowing their birthday, the number of children they have and their respective birthday. c. Value Proposition Definition. Thus having understood as much as they can about the customers they have chosen to serve, companies are then in a position to create a specific and tailored value proposition for them. Buttle (2000) previously raised five steps to profitable relationships that are, customer portfolio analysis (CPA), customer intimacy, network development, value proposition development and managing the relationship. The CPA analyses, according to Buttle (2000), the customer base to identify customers to target with different value propositions. The customer intimacy involves the business in getting how to know the selected customers as segments or individuals and building a customer data-base which is accessible to all those whose decisions or activities impact upon customer attitude and behavior. Buttle involves the network development as the third step wherein a strong network of relationships is to be built with employees, suppliers, partners and investors who understand the requirements of the chosen customers. d. Developing, with the network‟s compliance, propositions which make value jointly to the customer and the company. At this stage so far, the network has to work together to create and deliver the chosen value(s) to selected customers, Great value is “ found more effective and more efficient solutions of customers problems” (Buttle, 2000). e. Manage the customer relationship. These activities or stages need to be managed. Companies need to manage each customer through their lifecycle. To enable the management of the customer lifecycle and the stages within of portfolio analysis, intimacy, and value proposition development, automated data systems are necessary.
- 18. 4. The Payne‟sFive Forces Model
- 19. Model developed byAdrian Payne‟ The model identifies five core processes in Customer Relationship Management CRM such as the strategy development process, the value creation process, the multichannel integration process, the performance assessment process and the information management process. They can be grouped into strategic CRM, operational Customer Relationship Management CRM and analytical CRM.
- 20. Payne (2006) alsointroduced a strategic framework/model for Customer Relationship Management CRM consisting of five generic processes such as Strategic Development, Value Creation, Multichannel Integration, Information Management, and Performance Assessment. The Strategy Development process is concerned with integrating the business strategy from the organization angle and the customer strategy as to how firm interact and choose their customers. The Value Creation process with the main purpose of identifying the value the firm can create for the customer and the value the organization can also benefit from. The Multichannel integration consists of all the virtual and physical channels with which the firm plans to interact with. But the main thing here is that, regardless of the channel contact, the aim is to create an experience that is uniform and also common. The Information Management process consists of many different of data repository IT systems, back and front office applications and analytical tools. It is thus necessary to access the visibility of the system so the need for performance assessment process set in and it is concerned at the strategic monitoring can be used to determine customer satisfaction and standards,
- 21. 5. The Dasaiet al /Conceptual Model
- 22. The conceptual frameworkwas developed by Dasai el al (2007) in which consideration is driven towards competitive CRM performance from both internal and external perspectives. The dynamic capability for CRM is the key source for competitive CRM performance considering the rapidly changing nature of the business environment today which erodes the values of existing competencies. The framework comprises resources re-configurability, social networking capability and market orientation as the drivers of dynamic capability for CRM. While the IT variables which are the CRM technology and knowledge management are the moderators linking the relationship between dynamic capability for CRM and competitive CRM performance. As such, the direct impact of IT competence variables should be tried and seen on competitive CRM performance.
- 23. 6. The ForresterModel
- 24. The Forrester CRMmodel is grouped into four types such as: Strategy; Process, Technology; and People. The model produced results in the findings on over hundreds of companies using CRM as strategically, thorough analysis of over number of vendors‟ solutions providers and also with discussion with about numerous consultants. For firms willing to kick-start their CRM programs or for those that are finding it tough to get best out of their CRM programs after it has been launched. Also, the performance scorecard highlights the criteria used by companies to measure the overall performance using CRM
- 25. 7. The MaturityModel
- 26. Gartner‟s CRM MaturityModel is a tool in which the group used in rating enterprises in terms of their capabilities in effectively using CRM. To determine the category in which an enterprise is placed on the model, they are first evaluated in terms of Overall CRM vision and strategy, consistent valued-customer experience, organizational collaboration, processes, information, technology, metrics. All these elements were what composed of the Garner‟s performance measurement scorecard which was discoursed earlier on but the difference is that, haven scored your performance based on this elements, the maturity model will then enable the firm to know where they are at the present and where they want to be over a period of time, what the requirement they will need to achieve that status. It is a very useful tool as each enterprise, that aims to satisfying their customer and also to maintain a lead in its industry, should make use of maybe at every set intervals.
- 27. Founded in Tampa,Florida in 2003, APEX Digital Imaging, Inc. is a total solutions provider for one of the fastest-growing new media called digital signage. The company provides strategic consulting, project management, content development and installation and maintenance services for organizations in corporate communications, healthcare, transportation, higher education and retail.
- 28. In 2008, APEXDigital Imaging (ADI) was suffering from sales pipeline management issues. The company was not effectively managing sales leads from trade shows, referrals, website leads, and phone calls. ADI concluded that it needed a portal where all information on customer touch-points could reside and simple workflow automation could be used to minimize manual efforts. So the company turned to Microsoft's CRM Dynamics. After several months of less than stellar results and growing frustration, the company realized that sales team, interns and the President of the company found MS Dynamics to be cumbersome and time-consuming and it was leading to employee productivity and the system not being used.
- 29. Through a professionalassociation webinar presentation offered by Skill of Success, ADI learned about Zoho CRM. However, ADI was preparing to launch a series of marketing campaigns and sales initiatives to coincide with its recent website upgrade. This meant that if it was to consider Zoho CRM, Skill of Success would have to migrate, customize, and configure the entire system in a matter of days not weeks or months; this in order for ADI to stay on track with its scheduled marketing activities. A traditional implementation approach would simply be too costly and time consuming.
- 30. Working with Skillof Success, a Zoho alliance partner, the company migrated all of its historical records, configured and customized the system and provided training to two of the key staff members in less than five business days. The Zoho implementation did not disrupt the scheduled marketing campaigns. And within two weeks, ADI was capturing website leads and routing them through the Zoho CRM sales funnel. Using custom views, standard reports and Zoho's graphical sales funnel display allowed ADI to quickly analyze marketing and sales performance with minimal administrative effort. Sales lead generation has accelerated at ADI and Zoho CRM web forms linked to webinar registrations and 30 day digital signage trials has streamlined processes. Cost savings of over $1,750 in software licensing fees.
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- 32. The prospect hasa need or want for a product or service. The prospect is only aware of those companies that do a good job of communicating their ability to satisfy the need or want. Barriers to this awareness for an organization include; poor market positioning poor brand awareness low brand recognition Ineffective media selection Strategic Technology Considerations Touch Points Internet Advertising Social Networking Websites Email Marketing Viral Video Company Website CRM System Leads Management Campaign Management
- 33. A prospect passivelyor actively seeks knowledge about a company, product or service. The passive seeker will absorb information pushed through various media, while the active prospect will seek knowledge using key criteria and ideal attributes. Barriers to knowledge acquisition include; Insufficient information exist to do evaluation Information presented is not clear or complete Access to information is difficult. Strategic Technology Consideration Touch Points Email Newsletter Product Landing Page Case Study Documents for download Website Product Landing Page Webinars CRM System Literature Fulfillment Knowledge Base Website Integration (Web Import)
- 34. Prospects weigh theirknowledge of available solutions against their hierarchy of needs. These needs can be broad, such as practical needs of cost or value, timing, and specific expertise; personal, such as status or relationship; and emotional, such as overcoming fear of failure. Barriers to consideration include; Difficulty to access information Difficulty to evaluate the relevance of a given solution to their problem Poor sales process experience. Strategic Technology Consideration Touch Points Hosted Chat Product Comparison Reports Product Demo or try outs Inbound Call Center and Interactive Voice Response System CRM System Literature Fulfillment Knowledge Base Website Integration (Web Import) Opportunity Management
- 35. The prospect makesa selection based on how well the organization meets their hierarchy of needs and as well as how good was the interaction and experience during the informationgathering stages. At this point the prospect becomes a customer and if his or her expectations were exceeded the customer moves to the satisfaction stage. Barriers to selection include; Indecisiveness Unattractive pricing structure Economy Internal factures such as budgets and shifting priorities. Strategic Technology Consideration touch Points E-commerce Social networking Telemarketing Call Center Blogs CRM System Sales Force Automation Contact Management and Tracking Opportunity Management
- 36. The relationship intensifiesas the customer discovers whether performance meets expectations. Performance itself does not dictate satisfaction; rather, it is performance against expectations that determines satisfaction. Barriers to satisfaction include; Unrealistic expectations Customer was misinformed during the sales process Poor product/service performance Poor customer service Inconsistent customer experience. Strategic Technology Consideration Touch Points Surveys Customer support Forums Customer Support Chat Customer Support Call Centre Email and SMS Text message Alerts Out bound Call Alerts CRM System Customer Support and Case Management Contact Management and Tracking
- 37. As the customerexperience consistent product quality and/or service delivery he/she develops a strong affinity for the organization‟s offering. Overtime, a feeling of loyalty is developed to the point where a temporary fall in quality is easily forgiven and the relationship persists. Barriers to loyalty include; Inconsistent customer experience Brand and expected experience do not match Decline product or service performance Negative product changes. Strategic Technology Consideration Touch Points Online discounts Loyalty Program Cards and Membership CRM System Loyalty Program Management
- 38. Many customers willnever move beyond loyalty. However, those who do become advocates will provide significant benefit to your business, ranging from price premiums and lower service costs to greater usage. Advocates will actively recommend your product or service to friends and colleagues, moving prospects through early stages of the lifecycle on your behalf (Word of Mouth Marketing). Strategic Technology Consideration Touch Points Surveys Peer Forums CRM System Referral Management and Reward Contact Management and Tracking
- 39. Customer Retention isthe maintenance of the patronage of people who have purchased a company‟s goods or services once and the gaining of repeat purchases. Customer retention occurs when a customer is loyal to a company, brand, or to a specific product or service, expressing longterm commitment and refusing to purchase from competitors. a strategy whose objective is to keep a company‟s customers and to retain their revenue contribution. Primarily it aims to prevent customers from going to the competitor. STAYS - Customer being active and user of your product and service- This is mainly relevant to the products and services, having an existing contract. This includes banking, telecommunication and maintenance contracts. ‡ STAYS ENGAGED - Customer who maintain OR increase the level of relationship. A customer could still be retained, while he reduces his average, OR cancels two out of the three lines he has got.
- 40. Stay loyal longer Talkfavourably about the organization Pay less attention to the competition Are less price sensitive Offer service ideas to the organization Cost less to serve than new customers
- 41. Produce consistently highqualitywork. . Delight and inspire your customers. Build the corporate brand. Connect and engage with clients.
- 42. It is anaspect of consumer behaviour. Organizations are focusing on this area due to the growing Concerns for building long-term relationships with customers. Customer loyalty has been identified to be a competitive, growth and survival tool for many companies, especially in the highly globalized, industrialized and competitive markets. According to Oliver (1999)
- 43. 1. Bond withthe customer early 2. All customers are not created equal 3. Convey your company's value proposition in everything you do. 4. Do more than make your point. 5. Know why customers leave 6. Measure everything 7. Make loyalty-building a team effort. 8. Meet customers' expectations.
- 44. 9. Go beyondrewards programs. 10. Turn complaints into opportunities as quickly as possible 11. Build opportunities for repeat business 12. Survey customers, and pay attention to the responses 13. Create a system for collecting, analyzing and acting upon all customer feedback 14. Tie customer loyalty to expected business outcomes. 15. Use analytics to predict future loyalty 16. Manage your customer “life cycle.”
- 45. Customer Satisfaction Itis customers‟ perception of the degree to which the customers‟ expectations have been fulfilled. Customer satisfaction is how well our products, service, support and engagement are able to meet the customer expectations. Products - Products including physical products and services. Service - Customer service after sale. This includes responding to customer queries and issues. Support - Repair, maintenance and upkeep of your products post sales. ‡ Engagements - Engaging with customer, apart from the above mentioned contexts (product, service and support). This includes offering new products, schemes, up-sell, cross-sell, process reengineering and enhancement. are able to meet the customer Expectations - Customer satisfaction is your delivery compared with the expectations. The way a customer interprets your delivery also defines customer satisfaction. Customer satisfaction is driven by ´how well you manage your delivery and ´how well you manage customer expectations. ´Satisfied customer could be open to the next better opportunity ´Loyal customer. Returns despite offers by the competition
- 46. A 5-percent increasein loyalty can increase profits by 25%-85%. A very satisfied customer is nearly six times more likely to be loyal and to repurchase and/or recommend your product than is a customer who is just satisfied. Only 4 percent of dissatisfied customers will complain. The average customer with a problem eventually tells nine other people. Satisfied customers tell five other people about their good treatment.
- 47. Limited budget toimplement CRM Relationships with customers can break down due to lack of commitment. Engaging CRM system as a complete solution Unavailability of skilled personnel or technical expertise
- 48. Excellent customer serviceis about being aware of customer needs and reacting to them effectively. Understand anticipate and respond to your customers; needs in a consistent way, right across organization. A set of tools that let you do more for, and get more from, your customer. Keeps all your customer information in one place. Know and understand your customers. Know your best revenue opportunities. Spot the best sales campaigns. Provide better customer service Increase customer revenues Discover new customers Help sales staff close deals faster Make call centers more efficient Simplify marketing and sales processes
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