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Topics and Objectives:
Let's take a break from marketing analytics and see how these tools can be applied to the fundamentals of customer relationship management:
customer acquisition, customer development and customer retention.
Customer acquisition focuses on getting the right customers -- without overinvesting!
Customer development focuses on making current customers more profitable by selling them more products (cross-selling) and higher margin products
(up-selling). While cross-selling is as old as the 'Would you like fries with that?" pitch, new approaches combine sophisticated models and customer information to tailor or personalize the offers made to each
customer.
Customer retention is focused on keeping valuable customers - some not-so-valuable customers may be 'abandoned' or even fired.
Finally, it's useful to see how CRM is implemented in various industries. We've already had examples from industries such as financial services, gaming
(gambling) and direct marketers - so below are examples from other industries including retailing, telecom and airlines.
Required Readings :
Customer Acquisition, Chapter 10 from Building Data Mining Applications for CRM.
Power in Cross-Selling - A Proven Approach, Booz Allen
Booz-Allen extolls the returns from cross-selling on inbound calls from customers and reports some incredible response rates.
Fighting the Fickle, Wall Street Journal
A Wall Street Journal report on how firms are using technology to reduce churn in telecommunications.
Combating Churn: CRM in Subscription-Based Businesses, Unisys World, 2001.
More on churn in the telecommunications business - if you are thinking churn is a big problem, you are right!
Smart Data, Smart Decisions, Smart Profits: The Retailers' Advantage, McKinsey on Retail
CRM in the air, McKinsey Quarterly
- Another report from McKinsey outlining how CRM can help airlines hang onto customers and capture more of their value.
If a Telecom's customers really were its assets, Mercer Management.
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