1. Analytical CRM: The Fusion of
Data and Intelligence
Mihir Pandit [PC-09]
Vipul Patil [PA-20]
2. ANALYTICAL CRM
• The Fusion of Data and Intelligence
• The system associated with this customer
discovery
• Revolutionary Change
• Product Focused Enterprise Customer Centric
Enterprise
3. REQUIREMENTS FOR ANALYTICAL CRM
Learning relationship with customers
Notice: What its customer are doing
Remember: What it and its customer have done over time
Learn: From what it has remembered
Act: on what it has learned to make customer more profitable
7. Continue……
Data Mining
1. Give customers more of what they want
2. Value their time
3. Over delivery
4. Contact frequently (SMS/ Email)
5. Generate a trustworthy mailing list
6. Follow up
9. WHAT IS DATA MINING??
Data mining is the exploration and analysis of
large quantities of data in order to discover
meaningful patterns and rule.
Data warehouse provides the enterprise with a memory
Data mining provides the enterprise with an intelligence
Central idea: data from the past will be useful in future
Goal: to allow enterprise to improve its marketing, sales and
customer support operation through better understanding of
customer
10. WHAT TASKS CAN BE PERFORMED WITH DATA
MINING?
Directed and undirected data mining
Classification
Estimation
Prediction
Affinity grouping
Clustering
11. CLASSIFICATION
In order to understand customer and communicate about
world, we are constantly classifying, categorizing and
grading.
NMIMS
SBM SPP SPTM
M.Pharm+ MBA B.Pharm+ MBA
Pharmaceutics Pharma analysisQuality assurance
12. ESTIMATION
Deals with continuously valued outcomes
It comes up with a value for some unknown continuous
variable such as income, height or credit card balance.
E.g.: Regression analysis
Estimating numbers of children in family
Estimating the lifetime value of customer
13. PREDICTION
Prediction is same as classification or estimation except
that the records are classify according to some predicted
future behavior.
E.G. Predicting which customer will leave within six months?
14. AFFINITY GROUPING
To determine which things go together
e.g.: What things go together in a super market?
Market-Basket analysis
16. CLUSTERING
Task of segmenting a heterogeneous population into a
number of more homogenous subgroups or clusters.
Records are grouped together on the basis of self similarity.
Helpful in ‘Market Segmentation’
19. Who is our “SOCIAL” CUSTOMER?
Consumes information and learns about
breaking news through sites like
Twitter, Facebook , Linkedin etc.
Learns about new products through social
channels.
Is wise to unsolicited promotions and trusts
only relevant information.
Desires to converse with the brand rather
than 1-way ad messages.
Expects brand to be active in same social
media where he/she hangs out in.
Wants brand to listen engage and respond
quickly.
20. WHAT IS SOCIAL CRM?
It is companies strategy
to overseeing clients
and sales prospect.
• More as philosophy with
bussiness strategy
• Engages customer with
mutually beneficial
relationship
• Supported by social
technology, bussiness rules
and processes.
21. It is based on around information
that companies could collect on
their customers and then input
into crm system that allows them
to target various customer.
OLD GUARD:
TRADITIONAL CRM
NEW GUARD:
SOCIAL CRM
PR department: bigger role by taking charge
of brands social presence while handling
customer engagement online.
Advocacy and experience:
No active message but active engaging.
23. According to Wikipedia - Web 2.0 is a term describing changing trends in the use of
World Wide Web technology and web design that aims to enhance creativity, secure
information sharing, collaboration and functionality of the web.
Web 2.0 is enabling:
• Collaboration
• Community creation
• Conversation
• Creativity
Image source:
http://web2.socialcomputingmagazine.com/all_we_got_was_web_10_when_tim_bernerslee_actually_gave_us_w.htm
It all started with the web 2.0 revolution and its 4C’s
24. Web 2.0 stimulated
fundamental changes in
consumer behavior
Interactions between
customer and brands starting
earlier and never ending
New behavior patterns
demand a new
strategy, better
segmentation, new channels
and targeted messages and
review of current customer
facing business processes
Being connected, customers realized that they could
ask more from companies and share opinions about
products and services
The new
Social
Customer
Uses new
online
channels and
new
communication
tools
Trusts in
advices made
by online
acquaintances
and strangers
Tends to buy
more online
than offline
Wants to
provide
feedback
about the
product and
customer
service
Expects better
customer
experience
Reads and
creates
product
reviews, produ
ct rankings
and blog posts
Seeks support
to connect
with like-
minded peers
25. New CR means more than just mere on demand
attention or mass customized products and services
Web 2.0 provoked an
expansion of the “R” in the
CRM acronym
Company / Customer
Company / Partner
Company / Competitor
Company / Company
Customer / Partner
Customer / Competitor
Customer / Customer
Partner / Competitor
26. Technology
Lets take a look at the fundamental changes that Social CRM is
introducing to the current, traditional CRM in terms of…
Landscape Channels Processes
Mindset
Your company
Competitor Supplier / Partner
Customer Customer
CustomerCustomer
Customer Customer
Customer
Customer Customer
Customer Customer
Customer Customer
• Phone
• Fax
• Email
• Service
• Letters
• Personal contact
• Company’s website
• SMS
• Instant Messenger
• Chat
• Media
• Phone
• Fax
• Email
• Service
• Letters
• Personal contact
• Company’s website
• SMS
• Instant Messenger
• Chat
• Media
• B
l
o
g
s
+
• Social Bookmarking
• Mi
cro
blo
gs
• RSS
• Wikis
• Social Networks
• Widgets
• Podcast
• Video sharing
• Forums
• Wish lists
• Pricecomparison website
• Reviews and ratings in retail sites
• Photo sharing
• Slides sharing
• Auction website
27. Evolution of the CRM landscape
•Focus on individual relationship (company to
customer, company to partner, etc.)
•Limited view of the customer and his
community preferences, habits, etc.
•Targeted messages generate value
Your company
Competitor Supplier / Partner
Customer Customer
CustomerCustomer
Customer Customer
Customer
Your company
Competitor Supplier / Partner
Customer Customer
CustomerCustomer
Customer Customer
Customer
Customer Customer
Customer Customer
Customer Customer
•Focus on collaborative relationship (engaging a
more complex relationship network)
•Multiple connections allow better understanding
of the customer and his community
•Conversation generates value
CRM 1.0 CRM 2.0
28. Evolution of Customer Touch Points
•Single view of the customer based on the
interactions history, customer profile data
residing in the company’s base and data
integration with internal systems
•Company owns the data but it is limited to
previous interactions
• Phone
• Fax
• Email
• Service
• Letters
• Personal contact
• Company’s website
• SMS
• Instant Messenger
• Chat
• Media
• Phone
• Fax
• Email
• Service
• Letters
• Personal contact
• Company’s website
• SMS
• Instant Messenger
• Chat
• Media
• Blogs
+
•Single view of the customer is far more complex to
achieve. Besides internal information, the
company must rely on external information such
as customer profiles in social networks and his
behavior when participating in a community.
•Customer and other web 2.0 sites own part of the
precious data
• Social Bookmarking
• Microblogs
• RSS
• Wikis
• Social Networks
• Widgets
• Podcast
• Video sharing
• Forums
• Wish lists
• Price comparison website
• Reviews and ratings in retail sites
• Photo sharing
• Slides sharing
• Auction website
CRM 2.0CRM 1.0
29. Evolution of Business Processes Modeling
•Customer processes developed from the
company standpoint (customer life cycle for
the company).
•Process centric – adapt and optimize
processes to support better customer
interaction
•Focused on CRM processes
•Company processes developed from the customer
standpoint (company life cycle for the customer.
•Conversation centric –to establish brand
community, enable idea capturing and better
segmentation
•Focused on the evolution of CRM processes and
resulting impacts in the value chain
Establishing
need
Experience
Sharing
impressions
Decision
Marketing Sales
Customer
Service
Support processes
Operation processes
Value
Expansion
Targeting
Retention
Acquisition
Expansion
Targeting
Retention
Acquisition
CRM 2.0CRM 1.0
30. Evolution of Organizational Mindset
•Innovation comes from one specialized source
within the company (innovation group)
•Frontline employees communicate targeted
messages for transactional operations
•Innovation is gathered from all employees as
they are closely connected to the final customer
and to each other via internal web 2.0 tools.
Customers are in the center of the innovation
cycle.
•Frontline and non frontline employees engage
conversations including new customers in the
context and rerouting conversations. New
set of employee skills needed.
!
!
!
!
Interaction
Conversation
Contribution
Transaction
Feedback
Employee Customer Employees Customers
CRM 2.0CRM 1.0
31. Evolution of Technology
•CRM Solutions focused in automating and
supporting internal business processes
•CRM Solutions focused in community creation
internal and externally
Process Support
Account Management
Contact Management
Activity Management
Lead / Opp Management
Campaign Management
Sales Management
Service Management…
Conversation tools
Process Support
Account Management
Contact Management
Activity Management
Lead / Opp Management
Campaign Management
Sales Management
Service Management…
Monitoring /
Interconnecting tools
RSS
Blogs
Wikis
Social Networks
Widgets
Forums
Podcast
Brand monitoring
services
Data
mining
APIs
Open Id
Customer
Owned
Data
Cloud
Computing
CRM 2.0CRM 1.0
32. Bottom line
• Social CRM does not replace traditional CRM. It extends current CRM 1.0
capabilities to engage conversations with customers and the market,
• Social CRM humanize the company so the customer can see it as a trusted peer
(customers trust people like themselves),
• Social CRM puts the customer in the core of the company’s strategy. It affects
thoroughly operations, its value chain and organizational structure and culture,
• Social CRM introduces new value drivers into the
company’s strategy thanks to customers engaged
with the brand,
• Social CRM needs a new organizational mindset
supported by web 2.0 empowered employees.
33. Putting Social CRM to work: Understand Social
Influence in CRM Building Blocks and transform
it...
Strategy
Operations
Organization
Social
Influence
The Social Influence changes the traditional CRM building blocks and requires
companies to work towards a Social CRM concept composed by Social
Strategy, Social Operations and Social Organization
34. To support this transformation, go deeper in the
‘Company life cycle’ from the customer point of
view…Establishing need
Consumption needs
Need by influence
Buying
Paying
Experience
Searching
SelectingDecision
Comparing
Sharing
Sharing impressions
Deciding
Receiving
Using
CompanyLifeCycle
Customer
behavior
35. ...and apply findings into your current CRM
foundations following a consistent roadmap.
Social
Strategy
Social Operations
Social Organization
Implementation
Strategy
Redesign
Building Blocks
Design and
Develop tools
Monitor and
Adapt
• Understand your public
and current customer
behavior
• Decide how you will
engage with the market
(monitor buzz, react to
comments, supply social
platform, etc.)
• Find out which tools will
be deployed
• Build a business case
• Review current CRM building
blocks (as is)
• Realign Social CRM Strategy
with current CRM Strategy
(touch points, segmentation,
customer value, etc.)
• Review Processes to operate
Social CRM
• Establish Social CRM
mindset throughout the
company
• Design and develop tools
which will support the
company in engaging with
Social Customers
• Train employees and close
the recognition and
reward loop
• Measure results and
adapt current Social CRM
to meet changes in
customer needs and/or
market dynamics
36. Some foreseen benefits of Social CRM
Raise Marketing ROI better targeting, better product solution, customer experience and word-
of-mouth.
Gain insights to explore new market segments and improve marketing effectiveness
Identify new business opportunities and improve cross/up-sell abilities through increasing
contact with existing and potential customers
Cut sales commissions costs by building community around the brand
Increase R&D capabilities and innovation through tapping into the collective intelligence of
your target audience
Increase customer loyalty by promoting transparent dialogue and improving
employee/customer interaction efficiency
Decrease customer service costs through self-helping communities
39. Advantages
There are a couple of things that these accounts have in common that make
them great examples:
• Fast response times
• Follow-up support (you can’t fix everything via Twitter, so sometimes it’s
necessary to move the conversation elsewhere)
• If a quick solution is possible, it’s given immediately (see Best Buy’s San
Antonio example)
• Fast access to company information (these aren’t CEOs or CCOs, but they’re
definitely experts)
• They respond to both compliments and complaints
40. Application in data mining
Super market becomes a info broker:
Point of sale scanner
Record every item purchased.
Aggregate pattern is known.(what sells well together wat should be shelved together).
Eg. Safeaway,Walmart
Cross Selling:
Detailed record of customer & uses data mining to predict were are they in their life cycle &what product they
likely need.
Eg.ICICI,Fidelity investment
Wallet share and Customer share
Holding to a good customer:
New Customer> Old customer to retain.
Incentive is expensive hence data mining.
Weeding out bad Customer:
Some customer cost more than they are worth.
Consumes more resources without buying much.
Revolutionizing an industry :Eg.Wachnova
41. References
• Data mining techniques,2nd Edition for Sales
Marketing,Customer relationship management.
• Gartner Report.
• Harvard bussiness review.
• DATAQUEST, A Cyber Media Publication
Notes de l'éditeur
Analytical CRM comprises the analysis and systematic evaluation of customer data using business intelligence functions.
It is started from the first interaction of customer with enterprise.So let us take example from our class only that Ms. Pavitra has fondness of books and She is frequent buyer of books. Now earlier she was buying books from crossward but then she came to know about “Flipkart.com”Which provides books at very reasonable price , through cash on delivery and many more services…So she registered with enterprise (When she registered the first transaction processed between customer and Enterprise)A detail record is generated at the flipkart.com about pavitra.These transaction system are the customer touch points where information about customer behaviour first enters the enterprise
Every records of interaction with customer , each point of transaction, order , each visit recorded.Hundred of gigabytes and terabytes of data is gathered Data warehouse allows enterprise to remember what it has noticed about its customers.
Give customers more of what they want Analytical CRM can help an organization go beyond the typical “Dear Mr. Smith” salutation. An organization can use its analytical CRM information to make its communications more personable. For example, if it knows a customer’s shoe size and preferred brand it can notify the customer that there is a pair of size 12 shoes set aside to try on the next time the customer visits the store.2. Find new customers more of what they wantsimilar to the best customers Analytical CRM might determine that an organization does a lot of business with women 35 to 45 years old who drive SUVs and live within 30 miles of a certain location. The company can then find a mailing list that highlights this type of customer for potential new sales.3. Find out what the organization does best Analytical CRM can determine what an organization does better than its competitors. For example, if a restaurant caters more breakfasts to midsized companies than its competition does, it can purchase a specialized mailing list of midsized companies in the area and send them a mailing that features the breakfast catering specials.4. Beat competitors to the punch Analytical CRM can determine sales trends allowing an organization to offer the best customers deals before the competition has a chance to. For example, a clothing store might determine its best customers for outdoor apparel and send them an offer to attend a private sale right before the competition runs its outdoor apparel sale.5. Reactivate inactive customers Analytical CRM can highlight customers who have not done any business with the organization in a while. The organization can then send them a personalized letter along with a discount coupon. It will remind them of the company and may help spark a renewed relationship.6. Let customers know they matter Analytical CRM can determine what customers want and need, so an organization can contact them with this information. Anything from a private sale to a reminder that the car is due for a tuneup is excellent customer service.
Well, they mined the database that stored all the customer transactions and, to their big surprise, it turned out that beer was the product most often sold with diapers. On top of that, these purchases were made mainly on Friday afternoons by men between the ages of 25 and 35. After some serious thinking, the supermarket figured out the rationale was that because diapers are voluminous, the wife, who in most cases made the household purchases, left the diaper purchase to her husband who had the car. The husband and father, most often between 25 and 35 years old, usually bought the diapers at the end of the working week. With the weekend, beer often becomes a priority; and so, beer became the product most often associated with the sale of diapers.
CRM is strategically designed to improve interactions between different parties
JetBlue has Social CRM down, period. Especially considering that this is the airline industry, where companies deal with hundreds of thousands of customers every day, JetBlue’s community management team rocks. They are on top of their game and they always respond. Maybe that’s why they’ve reached 1.7 Million followers? Probably. This is Social CRM at its best: