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52 Cards in this Set
- Front
- Back
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segmenting customers |
Grouping customers to create specialized communications about products
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target marketing efforts |
e-mail or directmail saves labor & postage, reduces chances of being a nuisance |
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relationship marketing or permission marketing |
customers select the type & time of communication. Requires software & customer participation |
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cross-selling |
Additional products are sold as the result of an initial purchase (e.g., e-mails from Amazon.com describing other books boughtby people) |
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predicting customer behaviors |
firms forecast likelihood of customers’ purchases |
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customer defection analysis |
finding methods to retain customers |
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Churn reduction |
reducing customer defections |
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customer value determination |
verifies the customer lifetime value for individuals or segments |
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personalizing customer communications |
Understanding customer behaviors & preferences, firms customize communications |
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Clickstream |
how a customer navigates a Web site |
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event-based marketing |
offer the right products & services to customers at the right time |
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sales force automation (SFA) |
Used for documenting field activities,communications with the home office, & retrieving sales history |
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pre-transaction elements |
Precede the sale (e.g., customer servicepolicies, the mission statement, org. structure, & system flexibility).–Sales policy, Return Policy |
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transaction elements |
Occur during the sale & include the order lead time, the order processing capabilities & the distribution system accuracy. – Order lead Time |
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post transaction elements |
Occur after the sale & include warranty repair capabilities, complaint resolution, product returns, & operating information. –Warranty, Return |
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Steps to Designing & Implementing A Successful CRM Program |
Step1. Creating the CRM Plan Step2- Involve CRM users from Outset Step3- Select the Right Application & Provider Step4- Integrate Existing CRM Applications Step5- Establish Performance Measures Step6- Providing CRM Training for All Users |
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Trends in CRM: |
New Privacy Regulations- Rules & laws regarding invasion of privacy are springing up. Solution: develop a privacy policy & post it on their Web site. Application Service Providers (ASPs)- Fifty percent of all CRM programs are now designed & maintained for clients by ASPs. Adapting CRM for global uses is increasing New Markets out side of traditional industrialized countries require adaptation to local needs, language, & culture |
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· Customer Relationship Management must include: |
Talking to customers Understanding their behavior and their requirements Building a system to satisfy those requirements |
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Customer Relationship Management |
· The infrastructure that enables the delineation of and increase in customer value, and the correct means by which to motivate valuable customers to remain loyal—indeed to buy again Building& maintaining profitable long-term customer relationships**** |
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pure services |
offering few or no tangible products to customers |
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State utility |
they do something to things owned by the customer (e.g., store supplies & repair machines). |
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Differences between goods & services |
– Services cannot be inventoried. – Services are often unique (e.g., Insurance policies & legal services. – Services have high customer-service interaction – Services are decentralized due to inability to inventory & transport service products |
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Improving serviceproductivity is challenging due to: |
– High labor content – Individual customized services – Difficulty of automating services Problem of assessing service quality |
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Global Services Issues Global services are increasing all over the world. Managing global services involves a number of issues: – |
– Labor, facilities, &infrastructure support – Legal & political issues: Laws may restrict foreign competitors. – Domestic competitors & the economic climate: Managers must be aware of local competition and their environment. – Identifying global customers. |
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Service Strategy Development |
1. Cost Leadership Strategy- Requires large capital investment in state-of-the art equipment & significant efforts to control & reduce costs. 2. Differentiation Strategy- Unique service is created as companies listen to customers. 3. Focus Strategy- serve a narrow niche better than other firms |
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Services performed require a larger labor component than manufactured products Services also require use of facilitating products (e.g., computers, furniture, office supplies) that are not part of the services sold Customers have no idea how things actually get to the destination. But they sure notice when the shipment is late! |
Memorize |
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Service Response Logistics (SRL) |
The management and coordination of the organization’s service activities. |
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The four primary activities of SRL: |
Service capacity Waiting times Distribution channels, and Service quality |
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Service capacity: |
the # of customers per day the firm’s service system is designed to serve. -Disney |
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level demand strategy |
Capacity remains constant regardless of demand. When demand exceeds capacity, queue management tactics deal with excess customers. |
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chase demand strategy |
Capacity varies with demand |
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Poisson Distribution is often used to model customer arrivals*** |
Memorize |
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Queue Characteristics. |
– Queuing models assume infinite length of a queue – Queuing configuration can contain single or multiple lines. – Queue discipline: Describes the order in which customers are served. |
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Service Characteristics· |
· Provided either by single server or by multiple servers who act inseries or in parallel. · Multiple servers, acting in parallel, referred to as a multiple-channel queuing system. · Multiple servers acting in series is referred to as a multiple-phase queuing system.· The single-channel, single-phase configuration is the most basic.· Another characteristic of the service is the time required to complete each of the services provided. |
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Waiting time managementtechniques: |
• Keep Customers Occupied • Start the Service Quickly • Relieve Customer Anxiety • Keep Customers Informed • Group Customers Together • Design a Fair Waiting System |
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Distribution channels involve traditional methods & new channelsthat incorporate new Internet technologies |
· Eatertainment - Combination of restaurant & entertainment elements. · Entertailing - Retail locations with entertainment elements. · Edutainment (infotainment)- Combines learning with entertainment to appeal to customers looking for substance along with play. |
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Internet Distribution Strategies |
– Internet retailing is growing faster than traditional retailing. – Primary advantages of the Internet - ability to offer convenient sourcesof real-time information, integration, feedback, & comparison shopping. – Many retailers today sell products exclusivelyover the Internet (a pure strategy), while others use it as a supplemental distribution channel (a mixed strategy). |
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Managing Service Quality- |
– Customer satisfaction with the service depends not only on the ability of the firm to deliver what customers want, but on the customers’ perceptions of the quality of the service received. – Service quality depends on the firm’s employees to satisfy customers varying expectations. |
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The Dimensions of Service Quality |
– Reliability: consistently performing the service correctly & dependably. – Responsiveness: promptly & timely service. – Assurance: using employees who convey trust & confidence to customers. – Empathy: providing caring attention to customers. – Tangibles: the physical characteristics of the service including (Ex. facilities, servers, equip.,& other customers |
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· Facility location must be part of the firm’s supply chain strategy. · Companies can locate anywhere in the world due to increased globalization, technology, transportation, & open markets.· Location still matters-industry clusters show that innovation & competition are geographicallyconcentrated***.· Global location decisions involve location of the facility, defining its strategic role, & identifying the markets it serves |
introduction |
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Regional Trade Agreements & the WTO |
World Trade Organization (WTO) successor to the General Agreement on Tariffs/Trade(GATT). Functions include: – Administering agreements, – Forum for trade negotiations, – Trade disputes, – Monitor trade policies, – Aid for Developing countries – International organizations. |
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European Union (EU): |
1950 Set up after the WWII, the EU consists of 27 members |
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North American FreeTrade Agreement (NAFTA): |
[1994] among the U.S., Canada, & Mexico |
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Competitiveness of Nations |
Degree to which a country produces goods & services which meet the needs of international markets, while maintaining or expanding personal real income overtime. Made up of 323 criteria, grouped into 4 factors: 1. Economic performance (79 criteria) 2. Government efficiency (72 criteria) 3. Business efficiency (71 criteria) 4. Infrastructure (101 criteria) |
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Access & Proximity to Markets |
– “The trend in manufacturing is to be within delivery proximity of your customers. Logistics timelines & costs are the concerns, so that reinforces a clustering effect of suppliers & producers to places that offer lower cost labor & real estate.”- Daniel Malachuk – lower: cost, labor, and real estate---microsoft example |
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Environmental Issues |
– Global warming, air pollution, & acid rain are debated as the priceof industrialization. – Trade liberalization creates need for environmental cooperation. |
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labor issues |
– Labor availability, productivity, & skill. – Unemployment & underemployment rates. – Wage rates; turnover rates; labor force competitors. |
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right-to-work laws |
The right of employees to decide whether or not to join or support a union. |
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quality-of-life issues |
– Education– Economy– Natural Environment– Social Environment– Culture/recreation– Healthcare– Government/politics– Mobility– Public Safety |
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Land Availability & Costs |
– As land & construction costs in big cities continue to escalate, thetrend is to locate in the suburbs & rural areas. |
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business clusters |
• Geographic concentrations of interconnected companies & institutions • Research parks & special economic/industrial zones serve as magnets for business clusters • Reasons for success – close cooperation, coordination, & trust among clustered companies – fierce competition among rival companies– companies recruit from local skilled workers |
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finding a new customer costs five times as much as keeping an old customer |
fact |
