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&Ogilvy&MatherOgilvy Interactive TeamCustomer Relationship Management(CRM)Vladimir M JordanovDecember 2nd,2000Oglivy Interactive Beijing Boot-camp1&Ogilvy&MatherCustomers?Who are these guys?2&Ogilvy&MatherWhat is CRM?qqIn-depth analysis of customer In-depth analysis of customer behavior and attributes.behavior and attributes.qqApplying of the achieved Applying of the achieved knowledge in the formulation of knowledge in the formulation of marketing campaigns,strategies marketing campaigns,strategies and treatment plans.and treatment plans.qqMore than just a set of technologies More than just a set of technologies it is a process.it is a process.3&Ogilvy&MatherWhy CRM?qqCompany existence quest for Company existence quest for profit.profit.qqThree ways to increase the Three ways to increase the profitability of the customer baseprofitability of the customer baseqqAcquire more customersAcquire more customersqqOptimize the value of the existing Optimize the value of the existing customerscustomersqqRetain the right customers longerRetain the right customers longerqqAcquiring new customer cost 5-10 Acquiring new customer cost 5-10 times more that retaining the times more that retaining the existing oneexisting oneqqLoyal customers will will buy Loyal customers will will buy more and are willing to pay more and are willing to pay premium pricespremium pricesqq20/80 rule 20%of the customers 20/80 rule 20%of the customers generate 80%of the revenuegenerate 80%of the revenue4&Ogilvy&MatherWhy CRM?(continued)qqService leaders enjoy the following advantage over their low-Service leaders enjoy the following advantage over their low-service competitors:service competitors:qq They grow twice as fast.They grow twice as fast.qqThey experience a 6%annual growth vs.a 1%share loss(they take They experience a 6%annual growth vs.a 1%share loss(they take customers away from their competitors).customers away from their competitors).qqThey can charge 10%more from their products and still take They can charge 10%more from their products and still take customers away.customers away.qqThey enjoy 12%vs.1%average return on sales.They enjoy 12%vs.1%average return on sales.qqIndustry statistics show that 68%of customers walk away because Industry statistics show that 68%of customers walk away because of poor customer service.of poor customer service.5&Ogilvy&MatherEvolution of CRMqqMass MarketingMass MarketingqqTarget MarketingTarget MarketingqqCRMCRM6&Ogilvy&MatherMass MarketingqqReplaced the intimacy of direct salesReplaced the intimacy of direct salesqqOne way communicationOne way communicationqqWide geographic distributionWide geographic distributionqqLost is the personal touch with the customerLost is the personal touch with the customerqqMass marketing was enabled trough the technological Mass marketing was enabled trough the technological improvements in TV,radio,printed pressimprovements in TV,radio,printed press7&Ogilvy&MatherTarget MarketingqqDirect mail,telemarketingDirect mail,telemarketingqqReceiving customer responseReceiving customer responseqqLack of specific data,average response rateLack of specific data,average response rateqqIslands of informationIslands of information8&Ogilvy&MatherCRMqqNext evolutionary step,back to intimacyNext evolutionary step,back to intimacyqqCustomer loyalty build on:Customer loyalty build on:qqUnderstanding of customers wants,needs and valuesUnderstanding of customers wants,needs and valuesqqInteractivity with the customer in the way customer preferInteractivity with the customer in the way customer prefer9&Ogilvy&MatherCRM CycleqqAssessAssessl lWho are the customers demographics and lifestyle?Who are the customers demographics and lifestyle?l lWhere do they live?Where do they live?l lWhat are they worth?What is their lifetime value What are they worth?What is their lifetime value potential?potential?l lWhat and how do they buy?What and how do they buy?l lHow can they be reached?How have they responded to How can they be reached?How have they responded to promotions in the past and trough which channels they promotions in the past and trough which channels they prefer to be reached?prefer to be reached?qqPlanPlanqqExecuteExecutel lExecution and management of the marketing campaigns Execution and management of the marketing campaigns and customer treatment plans.and customer treatment plans.l lData gathering.Data gathering.10&Ogilvy&MatherCRM Critical Success FactorsqqArchitectureArchitectureqqData warehouseData warehouseqqData structure and architecture 80%of Data structure and architecture 80%of the service costthe service costqqAnalysis,ProfilingAnalysis,ProfilingqqCustomer InteractionCustomer InteractionqqSales force automation system.Sales force automation system.qqCall centerCall centerqqThe InternetThe Internet11&Ogilvy&MatherCRM ComponentsqqTwo basic set of toolsTwo basic set of toolsqqData collection toolsData collection toolsqqAnalytical and data delivery toolsAnalytical and data delivery toolsqqData warehouseData warehouseqqData archeologyData archeologyqqDepth and breadth of dataDepth and breadth of dataqqContact informationContact informationqqHousehold informationHousehold informationqqGroup informationGroup informationqqCustomer historyCustomer historyqqPromotion historyPromotion historyqqProduct purchase/usage historyProduct purchase/usage historyqqTransaction rollupTransaction rollupqqCustomer service historyCustomer service historyqqSurvey and customer response dataSurvey and customer response dataqqDemographic,psychographics,Demographic,psychographics,firmographicfirmographic and/or credit data and/or credit dataqqCustomer interaction informationCustomer interaction information12&Ogilvy&MatherCRM Components(continued)qqData extraction and cleansing Data extraction and cleansing qqData management and storageData management and storageqqScalability and open technologiesScalability and open technologies13&Ogilvy&MatherCRM EnvironmentqqApplications,PlatformsApplications,PlatformsqqVignette,Vignette,WebsphereWebsphere,BroadvisionBroadvision etc etc qqCommunication channelsCommunication channelsqqTraditional direct marketing,Traditional direct marketing,Electronic direct marketing,Electronic direct marketing,call centercall centerqqData mining,customer pro Data mining,customer pro qqData warehousingData warehousingqqOracle,SQL,DB2,Sybase Oracle,SQL,DB2,Sybase etc etc qqData analysis and profilingData analysis and profilingqqeSpectiveeSpective,WebtrendsWebtrends etc etc14&Ogilvy&MatherCRM Building Blocks15&Ogilvy&MatherOgilvy and CRMqqFocused on CRM Focused on CRM qqElectronic Data Marketing(EDM)Electronic Data Marketing(EDM)qqM OglivyM Oglivy16&Ogilvy&MatherOgilvy Interactive China and CRMqDoes Ogilvy Interactive manage the relations Does Ogilvy Interactive manage the relations with its clients?with its clients?qHow?How?qHow can we improve?How can we improve?qHow our competition manage the relationship How our competition manage the relationship with its customers?with its customers?17&Ogilvy&MatherThe Technology road ahead 2001qqTechnology strategy objectivesTechnology strategy objectivesqqTechnology Strategic key focusTechnology Strategic key focusqqKey technologies and skillsKey technologies and skillsqqTraining PlanTraining PlanqqTechnology Laboratory Technology Laboratory qqWork with other companies and organizationsWork with other companies and organizationsqqServices provided by the Technology groupServices provided by the Technology group18&Ogilvy&MatherObjectivesqqTo To be be a a technology technology center center of of excellence excellence among among the the Interactive groups in the region and worldwide.Interactive groups in the region and worldwide.qqTo To excel excel best best practices practices and and technologies technologies in in the the region region and worldwide.and worldwide.qqTo be on the leading edge of the new technologies.To be on the leading edge of the new technologies.qqTo be innovative.To be innovative.qqImprove,improve,improve Improve,improve,improve 19&Ogilvy&MatherTechnology Strategic key focusqqCurrently used technologiesCurrently used technologiesqqContent Management SystemContent Management SystemqqActive Server Pages and Web Applications Development Active Server Pages and Web Applications Development qqLight and Medium Backend Database Development Light and Medium Backend Database Development qqFuture technologiesFuture technologiesqqMobileMobileqqCRMCRMqqASP ModelASP ModelqqConsulting technologiesConsulting technologiesqqHeavy backend database development.Heavy backend database development.qqFull scale transaction based e-commerce solutions.Full scale transaction based e-commerce solutions.qqERP and on-line supply chain managementERP and on-line supply chain management 20&Ogilvy&MatherKey Technologies and skillsqqOperating Operating Systems Systems Linux,Linux,Sun Sun Solaris,Windows NT etc Solaris,Windows NT etc qqPlatforms Platforms and and Web Web Application Application Servers Servers ZopeZope,Domino,Domino,Netscape,Netscape,Apache Apache qqDatabase Database MS MS SQL,SQL,My My SQL,SQL,Oracle,DB2Oracle,DB2qqProgramming Programming Perl,Perl,Python,Python,C,C,Java,Java,Java Java Script,Script,HTML,HTML,DHTML,DHTML,VBSVBSqqTools Tools&Utilities Utilities WebTrendsWebTrends,WebBenchWebBenchqqTechnologies Technologies CMS,CMS,CRM,CRM,E-E-Commerce,One-To-OneCommerce,One-To-One21&Ogilvy&MatherTraining Plan The training plan for 2001 will be developed in accordance of The training plan for 2001 will be developed in accordance of the Technology Strategic Key Focusthe Technology Strategic Key Focus 22&Ogilvy&MatherTechnology LaboratoryqqNew technologiesNew technologiesqqSkills improvementSkills improvementqqPet projectsPet projects23&Ogilvy&MatherPartnership with third partiesqqHeavy back-end database developmentHeavy back-end database developmentqqCRM,ERP,E commerce CRM,ERP,E commerce qqInternship with leading Beijing Universities Internship with leading Beijing Universities qqPartnership Partnership with with leading leading technology technology companies companies(such(such as as Motorola,Nokia,IBM etc.)Motorola,Nokia,IBM etc.)qqPartnership Partnership with with leading leading software software companies companies(Vignette,(Vignette,BroadVisionBroadVision,Oracle etc.),Oracle etc.)qqASP modelASP model24&Ogilvy&MatherServices Provided by Tech.GroupqqContent management solutions design and implementationContent management solutions design and implementationqqFront-end programmingFront-end programmingqqBack-end programmingBack-end programmingqqSite architecture and integrationSite architecture and integrationqqSite hosting and administrationSite hosting and administrationqqInternet technology and strategy consulting Internet technology and strategy consulting 25&Ogilvy&Mather26
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