Customer Relationship Management (Chapter 5)

Customer relationship management (CRM)
A systematic tracking of consumer’s preferences and behaviors over time in order to tailor the value proposition as closely as possible to each individual’s unique wants and needs. Allows firms to customize marketing efforts to customers.
One-to-one marketing
Facilitated by CRM, one-to-one marketing allows for customization of some aspect of the goods or services that are offered to each customer.
Steps of one-to-one marketing
1) identify customers and get to know them in as much detail as possible.
2) Differentiate among these customers in terms of both their needs, and their value to the company.
3) interact with customers and find ways to improve cost efficiency and the effectiveness of the interaction.
4) customize some aspect of the goods or services that you offer to each customer means treating each customer differently based on what the organization has learned about him or her through prior interactions.
Any point of direct interface between customers and a company (online, by the phone, or in person)
Share of customer
The percentage of an individual customer’s purchase of a product that is a single brand. IT IS MUCH MORE PROFITABLE TO MAINTAIN CUSTOMERS THAN OBTAIN NEW ONES.
Customer equity
The financial value of a customer throughout the lifetime of the relationship. Not all customers are equal – i.e. runners buy shoes more often than non-runners.
Big data
A popular term to describe the exponential growth of data – both structured and unstructured – in massive amounts that are hard or impossible to process using traditional database techniques.
Where big data provides advantages
1) Identifying new opportunities through analytics that yield greater returns on investment (ROI) on marketing efforts.
2) Turning insights they gain into products and services that are better aligned with the desires of consumers.
3) Delivering communications on products and services to the marketplace more efficiently and effectively
Internet of Things
Describes a system in which everyday objects are connected to the internet and in turn are able to communicate information throughout an interconnected system. i.e. smart fridges
Direct path of data creation
You shop for a car online and see a model you like and submit a request with personal info that goes into a database.
Indirect path
you buy a lot of environmentally friendly things – this goes into a database – ads for environmentally friendly cars show up on your facebook.
Web scraping
The process of using computer software to extract large amounts of data from websites.
Sentiment analysis
The process of identifying a follower’s attitude toward a brand by assessing the context or emotion of her comments.
Scanner data
Data derived from items that are scanned at the cash register when you check out with your loyalty card. Sell this info to companies so they can know what different demographics buy.
Information overload
A state in which the marketer is buried in so much data that it becomes nearly impossible to decide which of the data provide useful information and which do not.
Data mining
Sophisticated analysis techniques to take advantage of the massive amounts of transaction information now available. Identify unique patterns of behavior among different customer groups.
Data warehouse
A system to store and process the data that result from data mining. Can cost up to 10 million dollars.
Reality mining
The collection and analysis of machine-sensed environmental data pertaining to human social behavior with the goal of identifying predictable patterns of behavior. i.e. go through calls on cell phones to predict what people will buy.
Data brokers
Companies that collect and sell personal information about customers.
Structured data
Data that 1, are typically numeric or categorical. 2, can be organized and formatted in a way that is easy for computers to read, organize and understand; and 3, can be inserted into a database in a seamless fashion. i.e. date, time, census data, facebook likes
Unstructured data
Unstructured data – contain non-numeric information that is typically formatted in a way that is meant for human eyes and not easily understood by computers. Technology is getting better at sorting through this data. i.e. body of emails, tweets, facebook status, video transcripts.
Data scientist
An individual who searches through multiple disparate data sources in order to discover hidden insights that will provide a competitive advantage.
Applications of data mining
1) acquiring customers
2) customer retention and loyalty 3) customer abandonment – firing bad customers that don’t make money
4) Market basket analysis – focus promotional strategies on which customers buy certain products.
Marketing analytics
A group of technologies and processes that enable marketers to collect, measure, analyze and assess the effectiveness of marketing efforts.
An online ad purchase in which the cost of the advertisement is charged only each time an individual clicks on the advertisement and is directed to the web page that the marketer placed within the advertisement. Google does this.
An online ad purchase in which the cost of the advertisement is charged each time the advertisement shows up on a page the user views.
Search engine optimization (SEO)
A systematic process of ensuring that your firm comes up at or near the top of lists of typical search phrases related to your buisness. i.e. beats pop up when you google high quality headphones
Predictive analytics
Uses large quantities of data within variables that have identified relationships to more accurately predict specific future outcomes. i.e. amazon packs and ships things to where they think people will buy them before they buy them.
Marketing metrics
Specific measures that help marketers watch the performance of their marketing campaigns, initiatives, and channels and, when appropriate, serve as a control mechanism.
Marketing control
The ability to identify deviations in expected performance both positive and negative as soon as they occur. Allows for marketers to adjust their actions before greater losses or inefficiencies are realized.
A metric that indicates the percentage of website users who have decided to click on an ad in order to visit the website or webpage associated with it.
Metric that signifies an even that occurs on a Web page that indicates the meeting of a predefined goal associated with the customer’s interaction with that page.
Metric in which the cost of gaining an order in terms of the marketing investment made to turn a website visitor into a customer who has chosen to make the transaction
Tagged In :

Get help with your homework

Haven't found the Essay You Want? Get your custom essay sample For Only $13.90/page

Sarah from studyhippoHi there, would you like to get such a paper? How about receiving a customized one?

Check it out