Mobile comms ripe for next generation CRM
In terms of CRM (customer relationship management) and customer profitability analysis, many mobile communications operators could do more to live up to their hi-tech image, according to Rick Volz, director of business development for Teradata (a division of NCR).
According to Volz, the companies currently reaping the rewards of CRM and customer profitability measurement technologies are those in industries such as financial services, having been first in with strategies resulting from their investments in those technologies.
At the Mobile Americas 2003 Summit in Miami, Florida, Volz shared his thoughts on the next generation of CRM and profitability metrics, describing how mobile/wireless companies could set about getting a true picture of each customer's contribution to their bottom line: By analysing detailed customer behaviours including a complete view of revenue contributions and actual costs.
"The communications industry is maturing. Wireless companies can move beyond the market entry stage of acquiring customers at any cost, and focus on customer retention, and expanding those high-value relationships that contribute to business performance," said Volz.
He stressed that it is no longer sufficient to rely upon averages, such as the often-quoted average revenue per user (ARPU), or the average margin per user (AMPU). Understanding the actual margin per individual user is essential for the effective allocation of resources and the development of profitable marketing, pricing, distribution, and servicing strategies.
"Many communications companies have already made an investment in data warehouses in order to integrate information from throughout the organisation and provide the foundation for customer profitability analytics," said David Hawley of the Yankee Group. "One great way to take advantage of this asset is to develop customer management strategies based on customer behaviours, propensities for purchase, and customer profitability."
Good examples Citing the financial services industry as a good example of the application of CRM, Volz explained that, for example, Teradata's own Profitability Analytics have helped a number of financial services providers attract, retain, and maintain profitable relationships.
Other benefits of the technology include the ability to target marketing campaigns and customers specifically, and also to understand channel value, usage and optimisation.
Pricing can be determined by segment, and products can be positioned against competitive offerings. Additionally, the technology can aid the implementation of risk and fraud management strategies.
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