Up Close & Personal?: Customer Relationship Marketing at Work

Contents......Page 5
Forewords......Page 9
Acknowledgements......Page 11
THE TIMES THEY ARE A CHANGIN’......Page 13
The rise of the savvy consumer or why e-mails makeyou fat......Page 14
The rise of extreme competition......Page 16
The rise of the remote customer......Page 18
CUSTOMER RELATIONSHIP MARKETING IS MOREIMPORTANT THAN EVER BEFORE......Page 19
IS CUSTOMER RELATIONSHIP MARKETINGPROFITABLE?......Page 21
Costs and benefits of customer relationship marketing......Page 22
CUSTOMER-LED OR MARKET ORIENTED?......Page 24
So, what does customer relationship marketing mean?......Page 25
The rise and rise of Britain’s leading retailer......Page 27
Brand management......Page 31
PROBLEMS WITH FUNCTIONAL MARKETING......Page 32
THE EVOLUTION OF CUSTOMERRELATIONSHIP MARKETING......Page 34
THE BASIS OF A CUSTOMER RELATIONSHIPMARKETING AUDIT......Page 37
GAINING A COMPETITIVE EDGE......Page 40
Customer relationship marketing and the product......Page 41
THE NEW CHALLENGE FOR CRM......Page 42
Implications......Page 43
Why are changing population demographics being ignoredby marketing managers?......Page 44
SO, WHY DO MARKETERS NEED BETTER CUSTOMERINSIGHTS?......Page 48
PERSONAL CONTACT......Page 49
The relationship-transaction-contact hierarchy......Page 50
The service encounter or ‘moment of truth’......Page 51
SUMMARY......Page 52
WHO IS A CUSTOMER?......Page 53
Internal customers......Page 54
The supplier as customer......Page 58
LEVELS OF RELATIONSHIP......Page 59
Fixing the relationship threshold......Page 61
THE EIGHT BUILDING BLOCKS OF CUSTOMERRELATIONSHIP MARKETING......Page 62
Branding and customer loyalty......Page 69
Types of buying behaviour......Page 73
BUSINESS-TO-BUSINESS BUYING MODELS......Page 74
Buying situations......Page 76
CUSTOMER RELATIONSHIP MARKETINGAND THE SALES PROCESS......Page 77
SUMMARY......Page 80
BUY-IN TOP TO BOTTOM......Page 81
Strategy as fit......Page 82
Strategy as stretch......Page 84
STRETCHING THE ORGANIZATION......Page 87
Where to begin?......Page 89
Internal and external factors......Page 94
Developing and implementing a CRM business vision......Page 95
Developing the new focus on customer-centric metrics......Page 96
Gaining commitment to relationship marketing......Page 99
The importance of a clear corporate strategy......Page 101
Getting commitment and understanding......Page 102
BOTTOM UP MANAGEMENT......Page 103
Performance indicators......Page 104
Linking strategy with operations......Page 106
Process summary......Page 108
BEGINNING THE TRANSITION......Page 111
SUMMARY......Page 114
CHECKLIST FOR REAP PLANNING......Page 115
MARKETING EFFECTIVENESS......Page 120
KEY PERFORMANCE INDICATOR (KPI) MEASURES......Page 127
THE KPI HIERARCHY......Page 129
Market factors......Page 130
Marketing activity......Page 131
Resources......Page 132
QUANTIFYING RELATIONSHIP MARKETING......Page 133
Stage 1: Target opportunities......Page 136
Stage 2: Revenue development opportunities......Page 137
Stage 3: Revenue protection opportunities......Page 138
Stage 4: Revenue and cost review......Page 139
Contact Strategy......Page 146
SUMMARY......Page 150
TRADITIONAL AND RELATIONSHIPMARKETING PLANNING......Page 152
Traditional marketing planning approach......Page 153
Relationship marketing planning......Page 156
DEVELOPING THE CAPABILITY FORRELATIONSHIP MARKETING......Page 163
CUSTOMER MANAGEMENT DIFFERENTIATION......Page 164
Ten ways to differentiate your customer relationships......Page 165
The importance of segmentation......Page 166
Ten key questions that determine segmentation......Page 168
Making sense of customer data......Page 169
Determining contact strategies......Page 173
A PRACTICAL APPROACH TO SEGMENTEDRELATIONSHIPS......Page 175
Basic rules for segmentation......Page 176
What precisely is ‘top vanilla’?......Page 177
Marketing planning and strategy......Page 178
Customer management......Page 179
Measurement and cost control......Page 180
Organization......Page 181
SUMMARY......Page 182
THE IMPLEMENTATION PROGRAMME......Page 185
EVALUATING CURRENT PRACTICE......Page 187
Understanding the customer base......Page 191
Benefit development......Page 192
Basis of the contract strategy......Page 196
Account management – working through the relationshipcycle......Page 198
PUTTING VALUE SEGMENTATION INTO PRACTICE......Page 202
Analytical segmentation techniques......Page 203
Putting value segmentation into action......Page 209
Using value segmentation for customer acquisition andretention......Page 211
Customer expectations and responses torelationship building......Page 218
CUSTOMER MANAGEMENT KEY PERFORMANCEINDICATORS......Page 219
SUMMARY......Page 221
WHAT IS CUSTOMER LOYALTY?......Page 222
The emotional loyalty pyramid......Page 223
Customer situations and loyalty......Page 225
What kind of loyalty scheme is best?......Page 227
Renewable contracts with fixed terms......Page 229
Scope for a multi-product relationship......Page 230
Combination of facilities and usage......Page 231
WHICH CUSTOMERS DO YOU WANT TO BE LOYAL?......Page 232
The loyalty grid......Page 236
1. Set objectives......Page 238
4. Media......Page 239
6. Sales......Page 241
CUSTOMER RETENTION – SIX STEPS TO SUCCESS......Page 242
2. Analysis......Page 243
5. Testing......Page 244
1. Define objectives......Page 245
2. Adopt a definition of loyalty that makes strategic sense......Page 246
4. Develop and quantify the loyalty approach......Page 247
6. Measure and evaluate......Page 249
ARE LOYALTY SCHEMES WIN-WIN?......Page 250
Transforming customer relationship marketing with aloyalty scheme......Page 251
SUMMARY......Page 255
MANAGING THE CUSTOMER EXPERIENCE......Page 256
Designing the customer experience......Page 260
Aligning the customer experience with the valueproposition......Page 262
DO CUSTOMERS WANT TRANSPARENTRELATIONSHIPS?......Page 265
Controlling the relationship: transparent versus prescriptivemarketing......Page 266
Customer-controlled contact......Page 268
Examples of emergent transparent marketing......Page 272
CUSTOMER VALUE MANAGEMENT AND PROCESSCONTRIBUTION ASSESSMENT......Page 274
Customer value management......Page 275
Process contribution assessment......Page 277
SUMMARY......Page 286
WHY MANAGE KNOWLEDGE?......Page 288
The importance of customer knowledge......Page 289
The value of knowledge......Page 290
Knowledge management in transparent marketing......Page 291
Innovation, knowledge and competitive advantage......Page 292
INNOVATION AND KNOWLEDGE MANAGEMENT......Page 293
Knowledge management infrastructure......Page 295
Knowledge and organizational design......Page 296
The creation of new knowledge......Page 299
How to encourage a group or team to createcustomer knowledge......Page 301
Some organizational problems for practicalknowledge management......Page 303
IMPLEMENTING KNOWLEDGE MANAGEMENT –CRITICAL SUCCESS FACTORS......Page 304
MAKING KNOWLEDGE MANAGEMENT A REALITY –SEVEN STEPS TO SUCCESS......Page 306
CUSTOMER KNOWLEDGE MANAGEMENT ANDORGANIZATIONAL ALIGNMENT......Page 308
The key principles of knowledge management......Page 310
SUMMARY......Page 320
HAS CUSTOMER RELATIONSHIP MARKETINGTECHNOLOGY DELIVERED THE GOODS?......Page 322
Problems in customer relationship marketing systems......Page 326
BASIC APPROACHES TO CUSTOMER DATAMANAGEMENT......Page 327
The need to integrate transaction and customermanagement systems......Page 330
Create an enterprise customer information managementplan......Page 333
Build measures of data quality......Page 334
Collect transaction history data......Page 336
Use customer data to understand customer current andlifetime value, preferences and retention drivers......Page 337
Customer preferences......Page 338
Build a customer infrastructure that supports recognitionand welcoming of customers......Page 339
Understand privacy......Page 340
Manage outsourced processes actively......Page 341
Analysis......Page 343
Collaborative channels......Page 344
SUMMARY......Page 345
IS IT WORTH HAVING A LOYALTY PROGRAMME?......Page 347
An initial attractive sales uplift, and then what?......Page 348
The costs and benefits of implementing a loyalty scheme......Page 349
WHAT IS A GOOD CUSTOMER?......Page 353
WHAT IS A BAD CUSTOMER?......Page 355
Categories at higher risk from bad customers......Page 356
PREDICTING GOODNESS AND BADNESS......Page 357
Using data for predicting customer risks......Page 359
Coping with privacy issues on a global scale......Page 364
Sharing data......Page 368
Managing the risk/value portfolio......Page 371
DEALING WITH COMPLAINTS......Page 372
THE CUSTOMER PERSPECTIVE......Page 374
Data strategy – acquisition, development andmaintenance......Page 379
Acceptable exposure versus missed opportunities......Page 381
SUMMARY......Page 382
DELIVERING CUSTOMER VALUE THROUGHRELATIONSHIP MARKETING......Page 384
CRM is thriving......Page 386
Where CRM improves value......Page 389
Some simple evidence......Page 393
The base method of approach for determining an ROI......Page 396
Examples of revenue calculations......Page 399
How ROI works out in practice......Page 400
Benefits as a percentage of turnover......Page 403
When CRM is approached as a journey, not a project, itworks better......Page 406
Summary of key points......Page 407
The paradox of progress......Page 408
SO WHAT NEXT?......Page 411
Demand-side promiscuity (and control by customers)......Page 413
The skills gap......Page 414
CUSTOMER RELATIONSHIP MARKETING ANDMARKETING REVOLUTION......Page 416
SUMMARY......Page 417
Appendix: A complete relationshipmarketing planning recipe......Page 419
References......Page 427
Index......Page 435