Accelerating Customer Relationships: Using CRM and Relationship Technologies

Front Cover
Prentice Hall Professional, 2001 - Business & Economics - 480 pages
Preface

Corporations that achieve high customer retention and high customer profitability aim for:

The right product (or service),
to the right customer,
at the right price,
at the right time,
through the right channel,
to satisfy the customer's need or desire.

Information Technology—in the form of sophisticated databases fed by electronic commerce, point-of-sale devices, ATMs, and other customer touch points—is changing the roles of marketing and managing customers. Information and knowledge bases abound and are being leveraged to drive new profitability and manage changing relationships with customers.

The creation of knowledge bases, sometimes called data warehouses or Info-Structures, provides profitable opportunities for business managers to define and analyze their customers' behavior to develop and better manage short- and long-term relationships.

Relationship Technology will become the new norm for the use of information and customer knowledge bases to forge more meaningful relationships. This will be accomplished through advanced technology, processes centered on the customers and channels, as well as methodologies and software combined to affect the behaviors of organizations (internally) and their customers/channels (externally).

We are quickly moving from Information Technology to Relationship Technology. The positive effect will be astounding and highly profitable for those that also foster CRM.

At the turn of the century, merchants and bankers knew their customers; they lived in the same neighborhoods and understood the individual shopping and banking needs of each of their customers. They practiced the purest form of Customer Relationship Management (CRM). With mass merchandising and franchising, customer relationships became distant. As the new millennium begins, companies are beginning to leverage IT to return to the CRM principles of the neighborhood store and bank.

The customer should be the primary focus for most organizations. Yet customer information in a form suitable for marketing or management purposes either is not available, or becomes available long after a market opportunity passes, therefore CRM opportunities are lost.

Understanding customers today is accomplished by maintaining and acting on historical and very detailed data, obtained from numerous computing and point-of-contact devices. The data is merged, enriched, and transformed into meaningful information in a specialized database. In a world of powerful computers, personal software applications, and easy-to-use analytical end-user software tools, managers have the power to segment and directly address marketing opportunities through well managed processes and marketing strategies.

This book is written for business executives and managers interested in gaining advantage by using advanced customer information and marketing process techniques. Managers charged with managing and enhancing relationships with their customers will find this book a profitable guide for many years. Many of today's managers are also charged with cutting the cost of sales to increase profitability.

All managers need to identify and focus on those customers who are the most profitable, while, possibly, withdrawing from supporting customers who are unprofitable.

The goal of this book is to help you:

  • identify actions to categorize and address your customers much more effectively through the use of information and technology,
  • define the benefits of knowing customers more intimately, and
  • show how you can use information to increase turnover/revenues, satisfaction, and profitability.

The level of detailed information that companies can build about a single customer now enables them to market through knowledge-based relationships. By defining processes and providing activities, this book will accelerate your CRM "learning curve," and provide an effective framework that will enable your organization to tap into the best practices and experiences of CRM-driven companies (in Chapter 14).

In Chapter 6, you will have the opportunity to learn how to (in less than 100 days) start or advance, your customer database or data warehouse environment.

This book also provides a wider managerial perspective on the implications of obtaining better information about the whole business. The customer-centric knowledge-based info-structure changes the way that companies do business, and it is likely to alter the structure of the organization, the way it is staffed, and, even, how its management and employees behave.

Organizational changes affect the way the marketing department works and the way that it is perceived within the organization. Effective communications with prospects, customers, alliance partners, competitors, the media, and through individualized feedback mechanisms creates a whole new image for marketing and new opportunities for marketing successes.

Chapter 14 provides examples of companies that have transformed their marketing principles into CRM practices and are engaging more and more customers in long-term satisfaction and higher per-customer profitability.

In the title of this book and throughout its pages I have used the phrase "Relationship Technologies" to describe the increasingly sophisticated data warehousing and business intelligence technologies that are helping companies create lasting customer relationships, therefore improving business performance. I want to acknowledge that this phrase was created and protected by NCR Corporation and I use this trademark throughout this book with the company's permission. Special thanks and credit for developing the Relationship Technologies concept goes to Dr. Stephen Emmott of NCR's acclaimed Knowledge Lab in London.

As time marches on, there is an ever-increasing velocity with which we communicate, interact, position, and involve our selves and our customers in relationships.

To increase your Return on Investment (ROI), the right information and relationship technologies are critical for effective Customer Relationship Management. It is now possible to:

  • know who your customers are and who your best customers are
  • stimulate what they buy or know what they won't buy
  • time when and how they buy
  • learn customers' preferences and make them loyal customers
  • define characteristics that make up a great/profitable customer
  • model channels are best to address a customer's needs
  • predict what they may or will buy in the future
  • keep your best customers for many years

This book features many companies using CRM, decision-support, marketing databases, and data-warehousing techniques to achieve a positive ROI, using customer-centric knowledge-bases.

Success begins with understanding the scope and processes involved in true CRM and then initiating appropriate actions to create and move forward into the future. Walking the talk differentiates the perennial ongoing winners. Reinvestment in success generates growth and opportunity.

Success is in our ability to learn from the past, adopt new ideas and actions in the present, and to challenge the future.

Respectfully,

Ronald S. Swift
Dallas, Texas
June 2000

From inside the book

What people are saying - Write a review

We haven't found any reviews in the usual places.

Contents

Chapter
1
Chapter
8
Keeping the Customers You Have
9
Some Companies Do CRM Naturally
16
Changes in Customer Positioning
23
Chapter 2
37
From Product Focus to Customer Focus
43
Chapter 7
48
Analysis Design
182
Reports Queries and Analytical Uses
193
Critical Success Factors for CRM and DW
197
Information InfraStructure CSFs
204
Information Technology Questions
211
Business Users Questions
220
GuidelinesThe OECD Principles
228
European Legislation
235

The CRM Organizations Structure
51
Integration of Business Information People Process and Technology
57
Data Warehouse Requirements Definition
63
Chapter 5
65
Six Key Enterprise Priorities
69
Chapter 4
93
Electronic Commerce
99
The Data Mining Process
112
Selection Criteria for Data Mining Technologies
120
The Stages of Growth for CRM and Data Warehouse
123
Managing the Stages of Growth in CustomerCentric
140
DW Successes from LongTerm Detailed Historical Enterprise Data
148
Management Considerations
156
Usage Support and Enhancement Phase
162
Building the CRM Data Warehouse
169
Chapter 10
257
Retail Data Warehouse
263
Chapter 11
273
Chapter 12
295
Anticipated Results of CRMKey Assumptions and Verifications
301
The Payback from Detailed Information
308
Chapter 13
319
Data Warehousing and Strategic Thinking
325
Data Warehousing and Maneuverability
332
The Financial Services Industry
340
Chapter 15
401
Appendix
423
Appendix
431
Index
457
Copyright

Common terms and phrases

About the author (2001)

RONALD S. SWIFT is Vice President and a key Strategist for Customer Knowledge Solutions at NCR Corporation, the world's leading provider of Relationship Technologies that expand and enhance relationships with customers.

Bibliographic information