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									Sales & Marketing ―
What’s CRM got to do
With it?
Lane Michel, Partner
Peppers & Rogers Group
CRM Can Enable Greater Alignment
Across all Customer Touch Points
 Strategy alignment, not just technology

 Guiding principles (1to1, IDIC)

 New tools and techniques that bring
  Sales & Marketing together
40,000 customers. What if only 80 matter?
CRM in Four Words…

Ask Yourself: What is your firm’s
most unique, non-replicable asset?
 Products?
 Brand equity?
 Sales staff?
 Merchandise?
 Stores?
 Databases and contact centers?
 Marketing programs?
… Or customers?
The “Learning Relationship”

             Customer tells
     Save    you what he

                              You tailor your product,
               FEEDBACK         service or elements
                                 associated with it

  The more effort the customer invests, the greater
      their stake in making relationship work

Now the customer finds it more convenient to remain
      loyal, rather than re-teach a competitor
Creating a Competitive Advantage

―We have only two sources of
competitive advantage:
1)the ability to learn more
  about our customers faster
  than the competition

2)the ability to turn that
  learning into action faster
  than the competition.‖

                                         — Jack Welch, CEO of GE,
           outlining his competitive strategy for the 21st Century
Technology & Tools Enable CRM, but…
                     CRM tools are only:
                      • as smart and
                        capable as your
                      • get results when
                        your business
                        processes change
                        to harness
                        customer insight
CRM can’t be installed.
 It must be adopted.
The Four Steps of 1to1 Marketing

     Identify customers, individually and
     Differentiate them, by value and
     Interact with them more cost-
     efficiently and effectively
     Customize information, messages,
     product and service offering based
     on learning
Cascading Goals:

More profitable growth

   Greater share of customer

     Differentiated treatment/experience

       Analytics on value/needs

          Customer knowledge Management
Strategy for Building Customer
Knowledge Management
Intelligence Layer: Customer needs,         360º View
feedback, unstructured information fields   Achieved Over
Associative Layer: Detailed transactions,
complex associations, analytics,
predictive values
Transactional Layer: Basic transaction
and association information direct and
Foundational Layer: Tools, technology,
business rules, basic customer              Start with Core
identification and address information to   Customer
build and maintain profiles                 Profile
• Customer Value and Needs Analysis
• Customer Knowledge Management
• 1to1 Marketing Discipline & Pilots
Customer Metrics
Required Capabilities for Marketing
 10 High-Value Marketing
 Processes for 21st Century
 •Marketing operations management
 •Marketing visibility, accountability
  and value measurement
 •Customer and market insight
                                                  Analysis              Insight
 •Customer-value-based segmentation
 •Portfolio and capacity-based resource
  allocation                                                 Customer
 •Product development and introduction
 •Customer-needs-based trigger                    Response              Action
 •Orchestrated customization–
  integrated marketing activities
 •Orchestrated cross-channel dialogues
 •Customer-value-based network
  management              Source: Gartner Group
Managed Analytics Overview
       1. Gather                                                                     2. Derive Customer
     Customer Data                                                                        Insight
(both internal and external)                        Analysis                          • Customer Needs
                                                                                      • Customer Defection
• Contact Information
                                                                                      • What products customer will
• Preferences                                                                           need next
• Purchasing Behavior                Decision
                                            -                     Reporting &         • Look-a-like portfolio analysis
                                                                                           - -
• Customer Interaction
                                      support                      Feedback           • Positive and negative triggers
• Demographic and


                        4. Evaluate                               3. Suggest Proactive
                           Response                                     Action
                        w Increase in customer satisfaction
                                                                  • Align Marketing & Sales resources to customers based on
                        w Incremental customer contribution         opportunity
                        w Increased customer interaction (e.g.,
                          attendance at events)                   • Develop customized marketing collateral based on
                                                                    customer need
                        w Decrease in defection rate
                                                                  • Offer customized content on Internet based on customer
                        w Increase in wallet share                  needs
                        w Increase in customer loyalty            • Design events around, and send invitations to, most
                                                                    valuable customers and look-a-likes
                                                                  • Feed customer insights to product development
Customer Value Tiers

       Use 1to1 to keep these
             customers                        Actual Value
                …and grow these.
                                              Potential Value
                      Migrate these
                (potential value unknown)     Costs

                                Spend no resources
                                marketing to these

MVCs     MGCs     ―Migrators‖   BZs
Customer “Needs” Groups in Action
                      The trick is to find
                       customers who ―look like‖
                       each other in terms of
                       their needs
                      Goal is to organize
                       strategy and treatments
                       around portfolios of
                       customers with similar
                      Identifying needs-based
                       groups among customers
                       is a first step to
                       differentiating the
                       experiences of individual
Defining and Meeting Enhanced Needs
Increases Your Relevance
 Beyond demographics
  •   Gender, age, geography, income, company size, title
 Beyond attitudes
  •   I am status conscious and want to use only the best
  •   My company uses technology as a competitive
      advantage and we are on the leading edge
 Needs are unique and behavior-driven
  •   I am an ―information-junkie‖ and a ―techie.‖ I want
      you to provide me with as much relevant information
      about personal electronics as you can.
  •   I am a ―frequent traveler‖ that spends most of my
      time driving from one city to the next. I have very
      little time – how can you save me time?
Basic Addressable Client Needs
(B2B example)
 Vertical industry
 Business event or trigger
 Advancement in life cycle
 Stated unmet need (feedback)
 Relationship growth, issue
 Common customer need
Needs are Classified in Different Ways

                                                        Increasingly Relevant and Impactful
                                                         Interactions Deepening Individual
                    Common Needs
Needs common to a large majority of customers

                                                               Customer Relationship
              Differentiating Needs

 Shared Needs        Needs shared across two or more
                     needs groups
Group     Group      Needs shared by customers in one
Needs     Needs      needs group

                     Needs specific to one individual

 Individual Needs
…Serves as the Foundation for a
Customized Interaction Strategy
               Common Needs                   Marketing
                    Shared Needs
       Shared Needs                           marketing
            Shared Needs                      messages
   Shared Needs               Shared Needs
  Needs   Needs    Needs   Needs     Needs   Customized,
  Group   Group    Group   Group     Group    Templated
    A       B        C       D         E       Offerings

1to1 Marketing Definition

 Discipline for the enterprise
 Engages the right INDIVIDUAL CUSTOMER
 At the right TIME
 With the right MESSAGE
 In the right WAY
 Enabled through CRM tools
 To drive more profitable revenue growth
 Build a 1to1 Marketing Pilot
                              Define ITSM Interaction Strategy

                      Step 2.               Step 3.               Step 4.
  Step 1.            INSIGHT                FOCUS                  PLAN
   ITSM                                                                               Step 5.
 Messaging                                                                          Execute Plan
  Review          • Insight              Review INSIGHT      Review FOCUS
                                          document with        document with
                    interviews with
                                          Marketing            Marketing
                    Marketing and
• Review                                                                           • Coordinate
  Current State     Sales                Review INSIGHT      Review FOCUS          activities and
  messaging                               document with        document with         timing with Sales
  materials,       Review of all         Sales                Sales
  contacts,         Account related                                                • Ensure baseline
                    external sources                         • Detail out how        measures are in
  vehicles                               Begin building       to best deliver
                    such as, Annual       1to1 plan by                               place
• Identify gaps     Report, Hoovers,                           what messages
                                          determining          to achieve the      • Initiate
  in marketing      Audio                 who to focus on
  and sales                                                    focus activities      interactions
                    Broadcasts, etc.      and what
  materials and                                                for each              defined in PLAN
                                          activities need      individual
  messages         Identification of     to surround that                         • Monitor
• Account           all Key contacts      interaction        • Delivery of the       responses,
  Selection         and types of                               PLAN document         feedback
                    interaction          Delivery of          which lays out      • Refine
                                          FOCUS                what has to           communications
                  • Delivery of           document             happen to             materials as
                    INSIGHT               detailing how        deliver the right     needed based on
                    document              marketing can        message at the        feedback and
                    detailing all         Focus their          right time in the     responses.
                    relevant and key      efforts to           right way
                    insights from all     support Sales at
                                          the selected
Sales Playbook Description
 Used by sales in preparation for customer
  •   Provides clearer view of customer experience in the
      context of understanding addressable needs groups
      in the market
  •   Delivers scripts and ―golden questions‖ to uncover
      customer needs in context of your ability to meet
      those needs
  •   Packages relevant marketing treatments that include
      optimized product & service offerings for grouping of
      customer needs
Addressable Needs are Grouped in Different
Ways to Make you More Relevant to Customer
                                                         Common Needs
 Increasingly Relevant and Impactful
  Interactions Deepening Individual

                                               Needs common to a large majority of customers
        Customer Relationship

                                                      Differentiating Needs
                                                             Needs shared across needs groups
                                        Shared Needs
                                       Group       Group     Needs shared by customers are
                                       Needs       Needs     grouped

                                                             Needs specific to one individual
                                                                •   Business event or trigger
                                                                •   Advancement in life cycle
                                        Individual Needs        •   Stated unmet need (feedback)
                                                                •   Relationship growth, issue
                                                                •   Common customer need
Delivering the Sales Playbook
  Segment &      research
 vertical plan
                                 Product /

    Define addressable       Develop Golden            Package
      Needs Groups          Questions & Scripts       marketing
                            to fit customers to      collateral for
       by segment
                              defined Needs         selected needs
                                                    Produce Sales
                                     Align            Playbook
                            product/service offer
                              to meet customer
                                 defined need
What can a 1to1 approach to CRM do
for my sales & marketing teams?

1.   Better position my company with our
2.   Replace 1-to-many marketing efforts
3.   Drive additional sales
4.   Enable greater alignment between
     Sales and Marketing
5.   Doesn't require any more customer     0%   0%   0%   0%   0%
     information than we have today
                                           1    2    3    4    5
Case Study: Bentley Systems

    Illustration of using customer needs
   group to create templated offerings for
          Sales Force Effectiveness
Bentley Systems Inc. Background
U.S. leading provider of software for
 ―enterprise engineering modeling‖
  •   Annual revenues of $175 million
  •   300,000 professional users
  •   Software manages architecture from design all
      the way through a structure’s life cycle

 Software shares info, automates
  paper trail
  •   Core product is MicroStation
  •   CAD program runs on PC
                                        Shanghai World Financial Center
 One of Bentley’s Business Challenges
 High market share (second in industry, saturated
 Infrequent sales spikes
                                Historical client
                 Revenue             sales

 But not only did this product focus make year-to-
  year growth projections uncertain ... it created
  numerous pitfalls
   •   Competitors could imitate MicroStation, eroding margins
   •   If market slows, Bentley must either cut margins or costs
   •   If market grows, competitors may create better product
   •   Independent resellers create unstable sales environment
Bentley’s Business Solution –
Leverage What They Know About Their Customers
 Broaden product line to meet more client needs over time
 Focus on end-user needs instead of market development
   •   Host industry user conferences
   •   Defined and meet enhanced needs through better
       information and data gathering, ―Drip Irrigation‖ through
       ―Golden Questions‖
   •   New products and services to increase revenue from each
                                Create sources of revenue
                                by meeting more of each
Revenue                         client’s needs

Sales Playbook Supported Aligning Sales &
Marketing for Customer Growth
 Effectively shifted focus from market share development to
  customer share development
   • Integrated marketing in front of and behind sales and channel
 Balance between corporate and sales-level customer
 Marketing delivers value to the customer-facing sales force by
  helping identify needs and interactions with most valuable
 Benefits are three-fold:
   • A culture of trust and support that further enables the whole
     company to develop deep customer relationships
   • More effective prioritization of sales efforts
   • Improved efficiency and relevance of marketing efforts
 Result: Alignment of sales and marketing efforts resulted in
  doubling of revenue and significant decrease in costs
Templating the “Sales” Process
Bentley initially devised 11
―account use scenarios‖
 Architects focus on design Needs          Group 7
                               Group 1
  aesthetics, price, comfort... Needs          Needs
                                Group 2       Group 8
 Architectural-engineering        Needs         Needs
                                  Group 3       Group 9
  firms build hospitals,
                                     Needs         Needs
  factories...                      Group 4       Group 10
                                          Needs      Needs
 Engineers put a pipeline in the        Group 5
  desert or a bridge across a river...      Needs
                                           Group 6
Using the Templates…
 Account scenarios derived from grouping of
  needs without looking at past transactions
 Bentley mapped 85 products and related
  services to the 11 account scenarios
  •   Descriptions of environment, customer needs and
      objectives of the customers within the scenario
 Account Manager and Marketing team
  quickly assembled details on all appropriate
  product and service ―modules‖ mapped into
 When a customer or prospect profiles into a
  scenario, sales and marketing respond
  together with the matching template
 Bentley’s Results

 Bentley’s new revenue model
  •   By moving MVCs to direct sales
      using sales templates and
      aligning Marketing behind Sales
  •   Bentley in FY 2001 achieved
      growth of 66% to $290M
      standing out among software
      vendors in a poor post 9/11 sales
..for additional information

Lane Michel
Peppers & Rogers Group

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