CUSTOMER RELATIONSHIP STRATEGIES BPOL 541 YA Arun Ayyagari - Glen Biely - Theo Cragg

Agenda Customer services issues facing businesses today Critique of 2 successful customer service oriented companies Lands End Cisco Summary

TODAY’S BUSINESS ENVIRONMENT: Innovation is accelerating Information and networks are more pervasive Customers face numerous choices (with little effort) Businesses still focused on products and services

THE RESULTING PROBLEM: Increased competition Products and services are commodities with ever decreasing margins Businesses misusing and under utilizing scarce resources Telecommunications and banking industries experience high customer defection rates and a saddled with numerous unprofitable customers

TODAY’S COMPANIES ARE LOOKING FOR: Loyal customers (easier said than achieved) More than market share, they want “share of wallet” Build RELATIONSHIPS with their customers EFFECTIVE CUSTOMER MANAGEMENT

EFFECTIVE CUSTOMER MANAGEMENT IS: Treating your best customers best Learning from your customers Anticipate customer needs its more profitable to retain customers than it is to acquire new customers

HOW DO COMPANIES ACHIEVE ECM Remold company culture Modify the organization structure Invest in technology Customer management software Provide organization with access to customer account history

WHAT WILL COMPANIES GAIN: More effective cross sell and up-sell Higher customer retention and loyalty Higher customer profitability Dramatically more productive sales efforts Higher response to marketing campaigns Extraordinary service and support More effective investment of scarce resources

LANDS’ END B2C; strong focus on customer satisfaction “Take care of the customer, the business will take care of itself” 80% business comes from repeat customers On-line business is booming 1999 online sales totaled $61M (4% total sales) 2000 on-line sales to date are over $150M Why Land’s End’s CRS is working . . . established one-to-one relationship.

LANDS’ END COMPETITORS J Crew.com “On-line catalog only” Well-designed site, good clearance items Poor sizing guide, no company information, random affiliate programs, e-mail contact only LL Bean.com “Outdoors Online” Park search, resort partners, outdoor programs, extensive company history, 5 languages, 1st time visitor walk-through, corporate sales Basic site, poor clearance items, e-mail contact only, difficult to find sizing information

LANDS’ END COMPETITORS Nordstrom.com “Style Not Substance” Shop by category, trends, your style, brands, special sizes, best sellers. Good company history. Beauty hotline newsletter, bridal boutique. Men’s mix & match, and . . . Power Browse. Limited sale items (Nordstrom Rack), all focused toward women. Contact by e-mail only. “Help” not easily found.

LANDS’ END Cont. Believe the longer customers stay on-line the greater chance a sale will occur Interactive Aids: Land’s End Live, Your Personal Model, Art Of Business Casual, Shop With A Friend, Oxford Express, Extensive company history, corporate sales, catalog quick order, Garrison Keillor audio, electronic greeting cards, Lost Mitten Club Clearly designed on-line business to develop customer relationship strategy

CISCO B2B that prides itself on it’s customer focus Has used numerous techniques such as TQM to improve all aspects of their business Sites customer relationships as “top priority” Consistently improved “customer satisfaction levels” since 1990

CISCO Cont. Utilizes special advisory board comprised of customers and channel partners Developed a central depository for information and knowledge that is shared throughout the corporation Eliminates “information silos” Must also leverage customer interaction information to create a competitive advantage

CISCO Cont. Technical Assistance Center Service & Support Solutions Products, Technologies, Tools, Documents, and Software Center Service & Support Solutions Success Stories Review customer experiences to ensure successful network General Service Programs Program overviews, Cisco Connection Online, Cisco Systems Capital, etc.

CISCO Cont. Service & Support Solutions (Cont.) Enterprise Service Programs, Service Provider Programs, and Small/Medium Business Details on ordering, installation, maintenance, account management, and consulting Partner Service Program Support programs for partners and resellers

SUMMARY Companies need to expand focus beyond product and services Implement network and database applications to capture customer information Make this information available company wide Develop relationships with customers

WE’RE DONE………………………...