CRM in Marketing CRM Initiatives CRM Marketing Initiatives

CRM in Marketing CRM Initiatives

CRM Marketing Initiatives l Cross-Selling l Selling a product or service to a customer as a result of another purchase l Selling the right product to the right customer

CRM Marketing Initiatives l Cross-Selling (continued) l Selling more products to a customer increases revenue from that customer and costs less than acquiring a new one l Not every customer is a good candidate l It is critical to understand the ways by which customers evaluate how and whether to respond to promotions

CRM Marketing Initiatives l Up-Selling l l Motivating customers to trade up to more profitable products Customer Retention l Analyzing customer attrition l l Understanding why customers have left Understanding who How do you keep them? Churn prediction l What is CHURN?

CRM Marketing Initiatives l Behavior Prediction l Using modeling and data mining techniques, including l Propensity to buy analysis l l Next sequential purchase l l What product is a customer likely to buy next Product affinity analysis l l What product is a particular customer likely to buy next Which products will be purchased with other products Price elasticity modeling and dynamic pricing l Determining the optimal price for a given product

CRM Marketing Initiatives l Customer Profitability and Value Modeling l Can a customer be unprofitable but still considered valuable? l Customer Lifetime Value (LTV) Potential value l Competitive value (wallet share) l

CRM Marketing Initiatives l Customer value measurement is data- intensive l Value modeling is only as accurate as the customer data is rich

CRM Marketing Initiatives l Channel Optimization l Means optimizing a company’s “inbound” channels with its “outbound” means of customer interaction l Knowing how to choose the best approach for each l Understanding the channels through which specific customers prefer to interact with the company AND How best to communicate with your customers l

CRM Marketing Initiatives l Personalization Customizing customer communication based on knowledge preferences and behaviors at the time of interaction l Online messages tailored to a particular customer or customer segment l In the B 2 C model, personalizaiton is based on the analysis of a customer’s clickstreams l

CRM Marketing Initiatives l Personalization l Clickstreams l l l A customers navigation path through a company’s Web site A company can see not only what a customer purchased by how the customer reached the site in the first place How he traveled through the site after he got there How much time he spend on each page Which products might have stimulated purchases of other products

CRM Marketing Initiatives l What new tactics can analyzing clickstreams trigger? l Changes to Web images l Custom promotions or discounts l Customized Web pages according to the visitor’s use of the site

CRM Marketing Initiatives l Event-Based Marketing Time-sensitive marketing or sales communication reacting to a customerspecific event. l Also called event-driven marketing l Can apply to a segment of customers or to individual customers l This is what companies adopting CRM are striving for l

CRM Marketing Initiatives l Event-based marketing Combine personalization techniques with process design to ensure that the right action targets the right customer at the right time l Ideal goal is to react to customers in near real-time l

Eddie Bauer l Read l the Case Study P. 45 -49 The CRM Handbook