Customer Relationship Management

Carl Benz AcademyNathan Garrett, PhD

available on http://profgarrett.comCreative Commons by-sa 2.0.

http://www.flickr.com/photos/ehktang/6298004648/sizes/o/in/photostream/

How can we go from one store to a country?

1. Record Data– Name, address– Revenue & cost– Preferences

2. Understand Customers– Segmentation– Upselling

3. Relationship Engagement– Email– Website– Personal

How well does CRM work?

2001 2002 2005 2006 2007 2007 20090%

10%

20%

30%

40%

50%

60%

70%

80%

Around 50% of CRM systems failed to reach expectations

What separates successful projects from failures?

Measurable goal

Reshape your businessDoes it work?

Establish require-ments

Buy system

Plan installation

Install system

Build

Buy

Company Mission

What separates successful projects from failures?

Buy a System Build Capabilities

Leadership IT Departmental Managers

FocusLarge-scale

technological system implementation

Pain points. Understanding customer

needs and aligning organization

Visibility Highly visible large projects Small and tacit

Resources Capital Time

Time Once Repeatedly

• Most valuable• Most expensiveThe right customer

• What do we offer?• How does it compare?

The right value proposition

• Unique value chain• Good linkagesThe best processes

• Resources and training• Compensation

Motivated employees

• Churn root causes• Metrics and learning

Learning to retain customers

What can a CRM do for us?

1. Record Data2. Understand Customers3. Relationship Engagement

CRM Tasks 1: Record Data

• Goals– Accurate– Available– Reduce costs

• Types– Quantitative ($, #)– Qualitative (preferences)

How can we create data?

• Survey– Formal sampling– Informal sampling– Automated follow-up / analysis– Not trivial!

• Micro-Experiments• Usability groups / task oriented• Focus group• Estimated metrics for competitors

Enterprise Rent-a-car

• “Overall, how satisfied were you…”– 80% to 50%– Shoot the messenger?

• Design: – Survey: granular, timely, summative– Callbacks: root cause analysis, probing

• Result:– Lower: 12% to 5%– Top scores 3x

Screen shot 2012-05-16 at 4.37.15 PM.png

CRM Tasks 2: Understand Customers

• High value– Over-Segmented– Personalized

• Mid value• Low value– Automated

Simple Methods

• Average• Separate by groups• Excel example

A/B Testing

Source: http://www.optimizely.com/static/img/whatisabtesting/howitworks.jpg

• 64m vehicles and customers

• 10-15 variables

• Which 100 people are likely to buy?

Regression Analysis

Decision Tree

Neural Network

Dataset

• 24 Disciplines• 19,000 Links• 1,639 Nodes• NodeXL

Times Node Appears

Count of Nodes

1 4132 3673 1704 1585 956 827 598 509 35

10 2911 2012 1513 1314 16

15+ 122

Fashion Design

InterdisciplinaryArchitecture

History

Art HistoryFilm

Writing

Graphic DesignAnimation

BusinessPsychology

MarketingPolitical Sci.

Comm. Theory

Library Science

MathNatural Sci.

Comp. Sci.

Economics

Interior Arch.

PhysicsBiology

Accounting

CRM Tasks 3: Engagement

• Sales automation– Emails– Self-service portal– Notecards– Targeted marketing materials– Service reminders

• Personalized Relationships– Sales staff follow-up– Service information

• Value-added Events– Event invitations– Clubs– Up-sell / cross-sell

Screen shot 2012-05-16 at 4.37.15 PM.png

Source: http://www.businessweek.com/magazine/content/10_02/b4162057120453.htm

How do you run a call center?

Source: http://photos.lasvegassun.com/media/img/photos/2009/06/15/scaled.0616_met_PON_hsieh_t653.jpg?214bc4f9d9bd7c08c7d0f6599bb3328710e01e7b

Closing Thoughts

A large, expensive, technology-focused project

or

Small, repeated projects to test tactical metrics