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Chapter 17Future of CRM - Dr V Kumar

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									Chapter 17:
Future of CRM
 Overview


Topics discussed:
    Social CRM
           Popular Social Media Channels
           Consumer-to-Consumer interaction: A new marketing portal
           Social CRM Strategies
           Sentiment Analysis
    Global CRM (GCRM)
           Information Technology Needs
           Global Diffusion
    Database CRM
           Cloud Computing
           Privacy Issues and Concerns




V. Kumar and W. Reinartz – Customer Relationship Management            2
Social CRM


    Emergence of the social web and peer-to-peer networks/conversations increasingly
     influence how customers interact with each other and how businesses use the social media
     tools to manage customer relationships


    Popular Social Media Channels
        Blog
        E-mail
        Social networking Platforms
        Podcasts and Internet Radio
        Mobile Application
        Widgets
        Viral Videos
        Social Coupons


V. Kumar and W. Reinartz – Customer Relationship Management                                     3
Popular Social Media Channels 1/4


    Blogs
        Increase in number of blogs
               300,000 in 2003 to 112 million in 2008
        Blogsphere has become a key marketing platform to improve efficiency in
           communications, customer service, and brand marketing
        Blogs became an important medium that marketers can channel favorably to promote
           their products, services, and brands
    E-Mail
        Most cost-effective marketing tools
        High ROI (yield $45.06 for every dollar spent in 2008)
        Highest frequency out of all clicking marketing formats
        Benefits include timing, accessibility, and customizing




V. Kumar and W. Reinartz – Customer Relationship Management                                 4
Popular Social Media Channels 2/4


    Social networking Platforms
        Substantial growth over the past 5 years
               High potential marketing and CRM toll
        Studies show a direct positive correlation between the use of social networking for
           customer acquisition and growth in revenue
        Benefits:
               Identifying and targeting micro-segments of consumers
               Starting dialogs with consumers
               Raising and improving brand awareness
    Podcasts & Internet Radio
        Useful to marketers in segmenting and
           customizing their messages on an individual basis




V. Kumar and W. Reinartz – Customer Relationship Management                                    5
Popular Social Media Channels 3/4


    Mobile Application
        Mobile Applications are gaining a greater share
           of users’ time commitment than the web is
        Benefit: allows marketers to cater to specific
           customer segments with targeted mobile applications
        Challenges: marketers need to constantly update
           or replace the application with more relevant offerings

    Widgets

        Gaining popularity from a customer standpoint, but companies are still reluctant to
           invest in widgets

        Concerns: widgets are experiencing “application burnout”

        E.g. Peanut recall widget



V. Kumar and W. Reinartz – Customer Relationship Management                                    6
Popular Social Media Channels 4/4


    Viral Videos
          Emerged as a user-driven method of communicating
          Exhibit the potential for marketing and promotions
                 Many brands use viral videos to strengthen brand awareness and brand
                  association

          Ex) Dos Equis “The most interesting man in the world
    Social Coupons
          Digital coupon is growing at an exponential rate
          Customer acquisition method for business
          New product/brand research portal for customers




V. Kumar and W. Reinartz – Customer Relationship Management                              7
Consumer-to-Consumer Interaction 1/3


    Social Media outlets are becoming a new marketing portal for
     Consumer-to-Consumer(C2C) Conversations
    C2C conversations brought customers a new level of autonomy
        Provide customers a freedom and accessibility to view, discuss, and judge products
           and services
        Provide the ability to formulate opinions on products on their own terms
        Enable consumers to actively engage and participate
           in the development and marketing process of
           products and services
        Influence their peers in buying decisions
        Access information on customers’ own terms




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Consumer-to-Consumer Interaction 2/3


    Increasing popularity of these social media tools impact B2C CRM
        Companies stop having complete control on the their web-based content
        Companies need to constantly participate in the online communications and adapt their
           offerings accordingly




V. Kumar and W. Reinartz – Customer Relationship Management                                      9
Consumer-to-Consumer Interaction 3/3


    Establishing new infrastructure for Social CRM
        Listening as a First Step
               Increasingly active role of the customer is changing the nature of business
               Companies should listen and utilize information collected on customers
               Identify the best strategies in addressing customer demands, concerns, and wants
        Mutual Purpose and Transparency
               Essential to define the “Mutual Purpose” that states the incentives for both
                 customers and the company
               Understand why the company the company is actually going onto social network,
                 and how it will positively affect them and their customers
               Important to stress authenticity, transparency, and relevancy in order to stay
                 involved in the customers process of obtaining information




V. Kumar and W. Reinartz – Customer Relationship Management                                        10
Social CRM Strategies


    Social Strategies – Not Social Tools
        Need to focus on creating adaptable social platform rather than focusing on available
           tools
        Social tools evolve and change constantly
        Social computing and interactions are becoming more essentia
    Implementation: Task-specific
          Utilize a social media tool because of a need or a purpose
                                                               We’re on Facebook, in order
            We are on Facebook                                to achieve ABC, which we will
                                                                   accomplish by XYZ

    Social CRM has very few recognized and recommendations to implement
          Still in the infant stage of its life cycle
    Few successful implantation:
          Trial and error and fast follower strategy

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Sentiment Analysis


    Sentiment Analysis help companies uncover the intended meaning behind consumer
     opinion and reviews
    Text Analytics: Fast growing technologies for automate sentiment analysis
        Collect text data on consumer insights from social media platforms, news articles, or
           information database
        Provide an objective summary of consumer reactions and responses to a company
        Ex) MediaVantage by Lexalytics
               Web-based application for media relations
               Enable firms to implement automated
                 sentiment analysis of blogs, social medi
               Marketers can monitor their company’s reputation,
                 align their corporate teams and messaging, and
                 measure the results of their communication efforts


V. Kumar and W. Reinartz – Customer Relationship Management                                      12
Global CRM 1/2


    Global CRM (GCRM): Strategic application of the processes and practices of CRM by firms
     operating in multiple countries, or by firms serving customers who span multiple countries

        Firm level GCRM: production, operation, product portfolio, and firm size

        Customer level GCRM: customer expectations, satisfaction drivers, loyalty, profitability


    Informational Technology Needs

        Multinational enterprises are implementing Software as a Service (SasS) models

               Integrate customer and company level data across various regions

               lower costs in attracting and retaining customers

               Increase employee productivity and call center efficiency

               Create more accurate sales forecasting for increased customer sales and
                satisfaction

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Global CRM 2/2


    Global Diffusion
        Regional and National Heterogeneity
                        Companies are challenged on designing and implementing business and
                         marketing strategies in various cultural environments and global customers

               Managers can better understand and align with their partners and clients from all
                 regions
                        Facilitating the process of making informed decisions

                        Adapting appropriately to the economic, culture, and political climates of each
                         area of business

        Applying it as a firm
               Essential to develop a uniform outlook on GCRM strategy in order to adapt and
                 implement it on a regional or national level
               Develop a CRM strategy at the highest level of management, but leave room for
                 needed adaptability
V. Kumar and W. Reinartz – Customer Relationship Management                                            14
Database CRM


    CRM needs more cost-efficient digital platforms for using, accessing and constantly
     updating the databases
    Cloud Computing
        Allows for more accessible and customizable implementation of CRM pratices
        Allows for remote access and real time updating in order to keep up with the dynamic
           and evolving nature of databases
        Applied easily and are economical without any infrastructure or maintance obstacles
    Privacy Issues and Concerns
        Accessibillity of web-based platforms cause concern for privacy issues
        Online companies place web bugs called „cookies“ in users‘ computer to acquire user
           information
        Online marketers and researchers should reassure customers and participants about
           the security of their personal information


V. Kumar and W. Reinartz – Customer Relationship Management                                     15
Summary


    CRM is undergoing significant changes with growing trends of social CRM, GCRM, and
     cloud computing


    Development in speed, reliability and spread of information channels such as Social Media
     have effected B2C and gradually influences B2B


    CRM database management has grown tremendously from an aggregate level to
     individualized and customized level that can be applied globally via cloud computing


    Advancement of CRM have given rise to privacy issues and concerns such as identity theft,
     privacy right violations, cyber stalking




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