- What is your understanding of CRM?
Customer relationship management (CRM) – involves managing all aspects of a customer’s relationship with an organization/management to increase customer loyalty and retention and an organization’s profitability. CRM helps companies make the their interactions with customers seem friendlier through individualization as well as increased profits by better service.
- Compare operational and analytical customer relationship management.
Operational CRM: supports traditional transactional processing for day-to-day front-office operations or systems that deal directly with the customers. Focuses on organising and simplifying the management of customer information. It uses a database to provide consistent information about a company’s interaction with a customer.
Analytical CRM: supports back-office operations and strategic analysis and includes all systems that do not deal directly with the customers. Analytical CRM uses data mining to provide strategic data about customers to gain business. Data mining uses various modelling and analysis techniques to find patterns and relationships to make accurate predictions.
Predictions might include;
— Which customers to market to
— Up selling / Cross selling
— Retaining good customers
- Describe and differentiate the CRM technologies used by marketing departments and sales departments
Three marketing operational CRM technologies:
- List generator – compiles customer information from a variety of sources and segment the information for different marketing campaigns
- Campaign management system – guides users through marketing campaigns
- Cross-selling and up-selling
÷ Cross-selling – selling additional products or services
÷ Up-selling – increasing the value of the sale
- How could a sales department use operational CRM technologies?
The sales department could use operational CRM technologies for sales management (selling the product), contacting management and opportunity management .
- Describe business intelligence and its value to businesses
Business intelligence (BI) – applications and technologies used to gather, provide access to, and analyses data and information to support decision-making efforts. BI includes simple MS Excel Pivot tables to highly sophisticated software that fetches data from the different front-and back-office systems.
Many Businesses are finding that they must identify and meet the fast-changing needs and wants of different customer segments in order to stay competitive in today’s consumer-centric market. BI can tell companies things like;
— Determine who are the best and worst customers thereby gaining insight into where it needs to concentrate more for its future sales
— Identify exceptional sales people
— Determine whether or not campaigns have been successful
— Determine in which activity they are making or losing money.
- Explain the problem associated with business intelligence. Describe the solution to this business problem
Companies can have a lot of data; however they are not able to benefit from levering this information and turning it into useful data for analytical and strategic decision making.
The issue most organisations are facing today is that it is next to impossible to understand their own strengths and weaknesses, let alone their enemies, because the enormous amount of organisational data is inaccessible to all but the IT department. The problem: data rich, information poor .
7. What are two possible outcomes a company could get from using data mining?
Two possible outcomes companies could get from using data mining are patterns and relationships among the data. This help determine what is business is and should be doing for future practices.
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