Sapphire_online_2009_SAP CRM7 Balance Customer Loyalty

7/26/2019 Sapphire_online_2009_SAP CRM7 Balance Customer Loyalty

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SAPPHIRE 2009

& ASUG Annual ConferenceHow SAP CRM 7.0 helps companies

balance customer loyalty and cost

Munish Gupta

Advisory Services



PricewaterhouseCoopers

May 2009

What we will cover

• The delicate balance between customer sustainability and cost

•The four pillars of customer sustainability

• How to achieve customer sustainability and manage cost

• Wrap up

Slide 2




May 2009

The delicate balance

Slide 3

“ Some Great Companies in the passion to

drive down costs, have mangled theirrelationships with Customers”

- Business Week,2006


http://slidepdf.com/reader/full/sapphireonline2009sap-crm7-balance-customer-loyalty 4/23PricewaterhouseCoopers

May 2009

Understand your customers to manage the balance

Slide 4

Companies must take positive actions with focus on revenue

and cost drivers

• Spend where it counts

• Stay relevant

• Continue to preserve trust

• Keep sight of growth

• Define a balanced

scorecard to manage

customer sustainabilitySource: PwC research



May 2009

What is customer sustainability?

Customer sustainability is all aboutmanaging and nourishing relationships

with the customers through“personalized customer experience”

or “differentiated offerings”

Slide 5



May 2009

Many forces are driving the increased focus on customer

sustainability

Slide 6

Current economic

situation

“ Me-too” products &offerings strategy

Absence of effective

infrastructure

support

Lack of intelligent

customer

interactions

Inconsistent

experience across

multi-channels

CustomerSustainability

Forestalling

revenue andmargin erosion




May 2009

SAP CRM allows companies to manage the balance between

customer sustainability and cost

Slide 7

When business and IT executives jointly take an end-to-end look at business

processes, the resulting investments can have up to ten times the impact of traditional

IT cost reduction effortsSource: McKinsey & Company, 2008




May 2009

The value proposition of improving customer loyalty and

delivering differentiated customer serviceCompanies must do more than tracking satisfaction and defection to measure customer

loyalty. The key now is understanding buying pattern and attitude to sustain customers.

Slide 8

Business Issues Business Benefits

The lack of understanding of customer needs drivescustomer defection

Customer loyalty rates are low due to perceptions of

poor service quality

Customer frustrations with channel inconsistency

High customer support costs

Disconnect between brand objective and actual

customer experience No reliable measurements of customer satisfaction

As a result of an improved customer loyalty and service: Customers stay with the company longer and lock-in

Customers recommend the company's products or

services to others

Customers spend more frequently with the company, and

in higher volumes

Customers demonstrate less price sensitivity

Customers require less frequent service and care

Key Metrics

Loyalty Program

Participation

Average Order Size

Customer Satisfaction

First Call Resolution

Customer Churn Rate

Customer Support

Costs

Customer Acquisition

Costs

Net Promoter Score

Conversion to PayingCustomer Sales Traffic/Volume

Statistics

It costs incrementally more to attract a new customer than

to keep an existing one

Companies can boost profits significantly by retainingmerely a small amount more of existing customers

Only a fraction of dissatisfied customers will express

dissatisfaction directly to the company

Happy customers tell others of their positive experience.

Dissatisfied customers tell even more how bad it was

Many customers do not feel valued by those serving them




May 2009

Predictable

Experience

• Consistent

• Intentional

• Not differentiated

• Not valuable

Random

Experience

• Inconsistent

• Unintentional

Designed

Experience

Loyalty

• Customer centric• Intentional

• Consistent

• Differentiated

• Valuable

Time

& e

Loyalty

Reven

u

Customer Experience Management is the

application of deep customer knowledge to

deliver products, services and interactionsthat are consistent across channels,

differentiated by segment and valuable to

customers.

Co

sttoServe

&

Tim

etoDecision

Designed customer experience management assists in

improving customer loyalty

Slide 9




May 2009

There is a lot of evidence to support the loyalty profiling to drive

customer spending and cost containment

Slide 10

Emotive interactions matter!




May 2009

Unified

customer

experience

Finding Solutions• Know the customer and what

customer owns• Show the customer solutions relevant

to customer’s business / industryvertical

• Propose “End to End” solutions• Help customer sell the software within

the company

Buying Solution

• Simplified quoting process• Bundle products for a solution and offerstandard bundles

• Know customer’s discount scheduleand default values into the forms

• Recommend purchasing on-linetraining with the products

• Optimize customers tax liability• Provide flexibility of selecting channel

of choice

Implementing• Seamlessly tie into customers Asset

Management system• Provide various choices on the

delivery media

Learning• Provide training on products and

customer’s business processes• Provide customer an enterprise

visibility of customer’s training

investments• Provide metrics on people who have

completed training

Using

• Support should be accessible via theweb and contact center • Provide a global view of all support

requests and resolutions• Help customer track software usage

across the enterprise

Upgrading• Provide an easy and manageable

process for renewals• Usage, Upgrade Plans and Support

should be coterminous• Tie into customers software asset

management system

A case for how SAP CRM enables customer experience

management during a closed software customer lifecycle

Slide 11




May 2009

A major “service centric” business evolution is in progress to

increase revenue and decrease cost

Slide 12

• Our research and industry

experience indicates that service

organizations must broaden theirservice portfolios and offerings to

sustain customers and drive

profitability.

• The key to success is to move

from “product support” to “service

centric” organization

• Service centric business mustincrease their value and

influence to their customers to

differentiate

Product Support• OEM product support

Customer Support• Additional service beyond

product sales

• Compatible and competitive

product support

Service Centric

• Service as a profit center • Service marketing

organization

• All inclusive support

V a l u e

a n d P

r o f i t a b i l i t y

Maturity




May 2009

Getting the pricing right is key to staying relevant to customers

Slide 13

Companies need to manage the profitability of individual customers and

transactions with greater precision, better customer insights and price

sensitivities.




May 2009

A thoughtful closed-loop revenue management process paves

the way to profitability and manage cost• Revenue management analysis

- Identify revenue leakage areas.

- Quantify and prioritize opportunity areas.

- Profitability improvement through price strategy

and settings.

• Revenue management improvement- Establish pricing policies and link to pricing

decision processes.- Setup auditable tracking of policy maintenance &

enforcement.

- An integrated technology platform decreases the

number of manual touches, reduce cost and

provide better information to the organization.

• Revenue management insights- Drive pricing decisions based on product, market

and customer insights.

- Understand the true profitability of the customer

for better business decisions.

Slide 14

Price to

Profitability




May 2009

A comprehensive customer insights approach is fundamental to

the success of customer sustainability

• Improve the knowledge of

customer behaviors in order to

improve their buying relationshipexperience

• Enabling organizations to tailor

their interactions with the customerover multiple channels based on

what they now know

• Improve processes within the

enterprise driving better customerservice and retention

+

Transactional

Data

Master

Data

+

Intelligence/

Warehouse

Slide 15




May 2009

Insight Driven Marketing analyst study

Key Findings

• Analytics drivenmarketing efforts yield

higher success rates

• Inbound customer

initiated interactions aregreat opportunity to

market

• Increase customer

satisfaction rates withintelligent offers

Source: SAP Executive Insight – Best Practices of the Best-Run Sales Organizations

Slide 16

“Intrusive”

3% Success

CampaignEnterprise Initiated,

Marketing Driven

“Intrusive”

3% Success

“Convenient”

20% Success

Event DrivenCustomer

Triggered,Product as Service

“Convenient”

20% Success

Real TimeCustomer Initiated,

Relationship Driven

“ Appropriate”

40% Success




May 2009

Closing thoughts

We are in an unprecedented economic times, but do not take

your eye off of what is most important to your business

CUSTOMERS

Slide 17




May 2009

What this means for your CRM initiative

Maximize CRM effectiveness during lean times by identifying

quick wins and get ready for when the economy turns around• Increase sales effectiveness

• Improve forecast accuracy

• Engender customer loyalty• Drive impactful marketing results

• Increase customer service flexibility while reducing costs

Slide 18




May 2009

Slide 19

Questions?




May 2009

Slide 20

To learn more…

• Visit PwC at Booth #736

• For more information on this topic (and other related topics),

visit our website at: www.pwc.com/us/SAP




May 2009

Slide 21

How to contact today’s speaker

Munish Gupta

Advisory Services

PricewaterhouseCoopers LLP

[email protected]

(214) 405 6490

Change creates opportunity



© 2009 PricewaterhouseCoopers LLP. All rights reserved. "PricewaterhouseCoopers" refersto PricewaterhouseCoopers LLP or, as the context requires, the PricewaterhouseCoopers

global network or other member firms of the network, each of which is a separate and

independent legal entity. This document is for general information purposes only, and should

not be used as a substitute for consultation with professional advisors.

Change creates opportunity.



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Sapphire_online_2009_SAP CRM7 Balance Customer Loyalty