One of the most powerful features of interactions and transactions over the Internet is that everything is tracked and recorded (see the Data Analytics and Conversion Optimisation). This provides a wealth of data that can be analysed to make business decisions.
For CRM, this means that the customer acquisition source can be recorded and analysed against sales data. This leads to a very accurate return on investment (ROI) calculation and indicates where CRM and marketing efforts should be focused.
ROI stands for return on investment – and it’s key to understanding whether marketing efforts have been successful. Here’s a simple example: Company A sells accounting software and makes R10 000 on each product it sells. It sends an email to its customer base – people who have bought a previous version of the software and might be interested in upgrading. The campaign has an overall cost
of R100 000. Of the 5 000 people who receive the email, 10% decide to buy. That means it cost R200 to acquire each of the 500 customers. The company has made R5 million – an ROI of 50:1.
The key to effective use of technology in CRM is integration. Ensure that all channels can be tracked, and that information is usable to all parties within an organisation. Knowing where your customers come from, but not what they purchase, is pointless: these two metrics need to be compared in order to produce actionable insights.
Analysing CRM data can aid marketing initiatives in a variety of ways:
• Campaign analysis – find out which marketing campaigns are leading to the best returns so you can refine them and increase ROI
• Personalisation – customise your communications to each customer
• Event monitoring – tie offline events, like shows or sales, to your online interactions and sales
• Predictive modelling – predict a customer’s future behaviour and meet this need at the right time
• Improved customer segmentation, including:
o Customer lifetime value (CLV) analysis – predicting each customer’s lifetime value and managing each segment appropriately (for example, offering special deals and discounts)
o Advanced customer profiles that identify certain behaviours, such as big spenders or those who look for bargains by attending sales. This information can be used to tailor marketing communications accordingly
o Customer prioritisation – target small groups of customers with customised products and service offerings that are aligned to meet customer needs, rather than simply generic current offerings. You should craft specialised retention strategies for customers with the highest CLV
o Identifying brand influencers and advocates. Consider the realm of social media, where influencers are central to the spread of content. Brands are increasingly prioritising relationship building with social media influencers to build brand advocates who will help market the business for them. By identifying which customers are providing the most value and positively influencing others to become customers, you can focus efforts towards them and increase their loyalty, creating true
brand advocates
For CRM, this means that the customer acquisition source can be recorded and analysed against sales data. This leads to a very accurate return on investment (ROI) calculation and indicates where CRM and marketing efforts should be focused.
ROI stands for return on investment – and it’s key to understanding whether marketing efforts have been successful. Here’s a simple example: Company A sells accounting software and makes R10 000 on each product it sells. It sends an email to its customer base – people who have bought a previous version of the software and might be interested in upgrading. The campaign has an overall cost
of R100 000. Of the 5 000 people who receive the email, 10% decide to buy. That means it cost R200 to acquire each of the 500 customers. The company has made R5 million – an ROI of 50:1.
The key to effective use of technology in CRM is integration. Ensure that all channels can be tracked, and that information is usable to all parties within an organisation. Knowing where your customers come from, but not what they purchase, is pointless: these two metrics need to be compared in order to produce actionable insights.
Analysing CRM data can aid marketing initiatives in a variety of ways:
• Campaign analysis – find out which marketing campaigns are leading to the best returns so you can refine them and increase ROI
• Personalisation – customise your communications to each customer
• Event monitoring – tie offline events, like shows or sales, to your online interactions and sales
• Predictive modelling – predict a customer’s future behaviour and meet this need at the right time
• Improved customer segmentation, including:
o Customer lifetime value (CLV) analysis – predicting each customer’s lifetime value and managing each segment appropriately (for example, offering special deals and discounts)
o Advanced customer profiles that identify certain behaviours, such as big spenders or those who look for bargains by attending sales. This information can be used to tailor marketing communications accordingly
o Customer prioritisation – target small groups of customers with customised products and service offerings that are aligned to meet customer needs, rather than simply generic current offerings. You should craft specialised retention strategies for customers with the highest CLV
o Identifying brand influencers and advocates. Consider the realm of social media, where influencers are central to the spread of content. Brands are increasingly prioritising relationship building with social media influencers to build brand advocates who will help market the business for them. By identifying which customers are providing the most value and positively influencing others to become customers, you can focus efforts towards them and increase their loyalty, creating true
brand advocates
