Module-1
Introduction and significance of CRM
BY: DR: [Link]
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IDIC model
The IDIC model was developed by the Peppers and Rogers Group. IDIC stands for the four
stages of CRM implementation: Identify, Differentiate, Interact, and Customize.
Identify
The first step of the IDIC model of CRM is to identify your customers by collecting
information like the customer’s name, address, and purchase history at each point of
contact across the company. The goal is to collect as much information or data as you can
on each customer to understand their needs, wants, and purchase behaviors better
Differentiate
This step of the IDIC model is to differentiate or segment your customers based on their
current and projected lifetime value. By differentiating your customers based on their value
to the company, you can prioritize your customer relationship efforts on the most valuable
clients and tailor your interactions to best fit each segment for optimal profitability.
Interact
The third stage is where you get to apply your CRM plans for
interacting with your customers. Once your customers are analyzed
and categorized, you can develop customized interactions—for
example, for valued customers, you might offer loyalty benefits or
rewards to encourage retention and continued spending.
Customize
After you have documented your customer interactions, you can then
analyze them to develop more customized one-to-one service. The
goal is to ensure that your customers’ needs and expectations are
met and that you have pinpointed them individually (or very
narrowly).
Quality Competitive index model
The QCI model starts with the customer’s external
environment at the top—their pain points, business goals,
and other factors will affect whether they are ready to buy
or interact with your sales team, which in turn impacts the
customer experience. The customer experience then
affects customer proposition (what you offer the
customer) and customer management activities. As
you can see from the magnified version of the inner circle,
many activities are involved to acquire and retain
customers.
CRM value chain
A value chain is a high-level model developed by Michael Porter that
identifies the processes a business uses to develop an end product or
service for the customer. The goal of the value chain model is to
identify and prioritize the most valuable activities to the
company and improve processes to gain a competitive
advantage.
The CRM value chain model applies this principle to customer
relationships. This CRM model observes all the stages and activities
required to build a relationship with a customer.
These activities are divided into two stages: primary and
support.
Primary stage:
Customer portfolio analysis: The first step of the value chain model is to
analyze your customers(the customers who create the most value for the
company). This analysis stage helps companies understand their customers
so they can better address their needs and expectations and develop
strategies to maximize their lifetime value.
Customer intimacy: The next step is to engage with the customer and
build on the original database of information.
Network development: A business’s network includes all people and
entities involved in the value chain, including partners, suppliers, customer
service, investors, etc. The goal is to use your customer data to inform the
processes at each level of your network so that the entire system works
together to optimize your customer’s experience.
Value proposition development: The idea is to shift the focus from the
product to your service and to reduce process costs to create more value
for the customer.
Manage the customer life cycle: This process involves evaluating your
Support stage
There are five supporting conditions necessary in order to effectively
implement the strategic processes of the primary stage:
•Leadership and culture
•Procurement processes
•HR management processes
•IT/data management processes
•Organization design
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Payne’s Five Process model
The Five Process CRM model was developed by Adrian Payne and
Pennie Frow. This model of CRM emphasizes a cross-functional
approach for effective CRM processes.
There are two main components to the model: cross-functional
CRM processes and key elements of CRM implementation.
Payne’s model outlines five processes:
[Link] development
[Link] creation
[Link] integration
[Link] management
[Link] assessment
There are four key elements necessary for a successful CRM implementation:
•CRM readiness
•CRM change management
•CRM project management
•Employee management.
When implementing a CRM strategy, companies should conduct a CRM readiness
assessment to determine how prepared they are to implement a new CRM process.
Additionally, because CRM involves a fundamental cultural and operational shift,
companies should invest in CRM change management and project management as
the new strategies are introduced and the complexities of the CRM initiatives grow.
Finally, employee buy-in is crucial for successful CRM. Make sure your employees
understand the strategies and processes and engage with the new customer-
centric culture.
Without these underlying conditions and elements, the CRM processes cannot succeed.
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Thank you….