Transcript Linking Strategies and the Sales Role in the Era of

Linking Strategies and the Sales
Role in the Era of Customer
Relationship Management
Sales and Distribution
Management
Marketing 3345
CRM is…
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a comprehensive business model for
increasing revenues and profits by
focusing on customers.
both an overarching business
philosophy and a process tool to
facilitate a truly customer-driven
enterprise.
CRM is…
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“…a journey of strategic, process,
organizational and technical change
whereby a company seeks to better
manage its enterprise around customer
behaviors. This entails acquiring
knowledge about customers and deploying
this information at each touchpoint to
attain increased revenue and operational
efficiencies.”
PriceWaterhouse Coopers
Customer-Centric Cultures
Include…
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Adopting a partnership business model
with mutually shared risks and rewards
Defining selling as “customer business
consultation”
Formalizing customer analysis processes
and agreements
Being proactive in educating customers
about value chain and cost reduction
opportunities
Focusing on continuous improvement
principles stressing customer satisfaction
The Marketing Evolution
Objectives of CRM
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Customer Retention - retain loyal and
profitable customers and channels
Customer Acquisition - acquire customer
based on known characteristics which
drive growth and increase margins
Customer Profitability - increase individual
customer margins by offering the right
product at the right time
Advantages of CRM
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Reduces advertising costs
Increases awareness of customer needs
Tracks the effectiveness of promotional
campaigns
Allows competition for customers based on
service, not prices
Prevents overspending on low-value
clients and under spending on high-value
ones
Speeds the time it takes to develop and
market a product
Improves use of the customer channel
The CRM Process Cycle
10 Critical Questions in CRM
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Customers
• Who are our customers?
• What do our customers want and expect?
• What is the value potential of our customers?
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The Relationship
• What kind of relationship do we want to build?
• How do we foster exchange?
• How do we work together and share control?
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Managerial Decision Making
• Who are we?
• How do we organize to move value closer to our
customers?
• How do we measure and manage our performance?
• How do we increase our capacity for change?
The Importance of Market
Orientation
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Successful salespeople think beyond
“selling”
Market-driven companies do better
market sensing
Market-driven companies develop stronger
relationships with customers and channels
Internal partnering is a critical component
of market orientation
Classifying Capabilities
Process of Strategy
Development
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The mission statement answers the most
basic questions about an organization’s
reason for being.
Firms should define their mission in terms
of broad human needs to be satisfied.
This approach makes it easier to identify
attractive market opportunities.
Process of Strategy
Development
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Goals – flow from the firm’s mission
statement and represent specific
targets the firm intends to hit.
Objectives – more specific than goals
and should always be:
• Specific and in writing
• Measurable
• Realistically attainable
SBU Strategy
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Business-level strategy involves how the
business will compete in its industry to
achieve a “sustainable competitive
advantage (SCA)”
An SCA focuses on distinctive
competencies
Porter’s Three Generic Strategies:
Low Cost
Differentiation
Niche
Process of Strategy
Development
Personal Selling’s Role in
Marketing Strategy
Stages in Relationship
Development
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Stage I – Exploration
Determine value, build trust, set
expectations, monitor
Stage II – Expansion
Generate repeat sales, full-line
selling, cross-selling
Stage III – Commitment
Build loyalty, become a preferred
supplier, engage in
Role of Personal Selling in IMC
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An Integrated Marketing Communications
(IMC) strategy effectively integrates personal
selling, advertising and other communications
options
Advantages of Selling in IMC
• Face-to-face contact
• More persuasive
• More demonstrative
• Customization opportunities
Disadvantages of Selling in IMC
• Limited ability to duplicate
• More costly
Sales Force Costs
Advertising vs. Personal Selling
Customer Loyalty ROI
Customer Satisfaction and
Feedback
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Maintaining customer loyalty is one outcome of
customer orientation.
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Loyal customers. . .
• Tend to concentrate their purchases.
• Provide positive word-of-mouth and customer
referrals.
• May be willing to pay premium prices for the value
they receive.
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Satisfaction measures need to be supplemented
with examinations of customer behavior, such as
annual retention rate, frequency of purchases
and percentage of the customer’s total
purchases captured by the firm.