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Resolv, Inc. September 2008 Newsletter | |
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Resolv, Inc. 821 E. First Ave Appleton, WI 54911
Phone: (920)730-1300
E-mail:
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Focus on Keeping your Profitable Customers In his book, The Marketing Imagination, Harvard business professor Theodore Levitt wrote that the purpose of a business is to get and keep a customer. While customer retention is an important aspect of profitability, in truth, not all customers are worth keeping.
Anyone who has ever invested in financial markets knows the value of analyzing the holdings in your portfolio to measure their return and determine their future potential. The goal for most people is to hang onto investments that are doing well and get rid of those that are underperforming.
Companies should learn to think of their customers as investments. The challenge is how to objectively assess their overall value to your organization. Many companies focus on measuring revenues and profits at the product or service level. Unfortunately, this approach does not provide insights into which customers are generating those profits.
Another approach is to measure profitability at the customer level. However, past customer revenue is backward looking and does not paint a picture of future profitability. Instead, companies need to focus on assessing customer lifetime value, that is, the net present value of all future streams of profit a customer generates over the life of his relationship with the business.
Two key drivers of customer lifetime value are acquisition costs and retention rates. How much it costs to acquire a customer can vary dramatically across industries. For example, acquisition costs range between $50 to $75 for credit card companies to $100 for long distance phone service providers and between $100 to $250 for mortgage lenders. For some companies, high acquisition costs can be justified against the length of term a customer stays with the firm. In the case of banks, once clients sign up for a mortgage, high switching costs means they are likely to remain customers for many years, bringing in far more revenue than the original cost of attracting them.
On the other hand, video rental companies operate in an environment where there are no real barriers to switching. When customers can easily move from one company to another, marketing programs with high acquisition costs tend to generate customers who are poor investments. So it's important to understand how much you spend to attract new customers - the cost factors as well as the impact of the acquisitions.
Wooing new customers with price promotions may result in more business. But be careful to consider the big picture. You may run a cost-effective promotion but attract primarily people who are price sensitive. Retention rates may be low as these same customers flit to the next good deal offered by a competitor, creating high churn and negligible profits. Studies indicate the average retention rate for U.S. companies is 80 per cent. That might sound pretty good until you look at the flip side. If you lose 20 per cent of your customers every year, your entire customer base turns over every five years. Factor in high customer acquisition costs and the picture becomes grim.
In the life insurance industry companies actually lose money in the first few years after a new policy is written due to high acquisition costs. As a result, there is a huge focus on retention. In the past, the bulk of commissions were paid to agents in the first year of the policy. However, with a multi-year return on investment, some life insurance companies changed their compensation approach to equalize commissions paid out over a longer period of time. While it was important to acquire new business, it was even more important to keep customers for the long term.
Customer turnover in the mobile telecommunications industry tends to be high. According to one customer relationship management study, Bell Canada has done a good job of identifying customers at risk of defection and enticing them to stay. Its monthly churn is only 1.5%, the best in the industry. If the entire U.S. wireless industry could achieve the same results, it would add between $1.5-2 billion in annual operating profit. Although your organization may not have quite so much at stake, determining customer acquisition costs and retention rates is beneficial. Customer lifetime value analysis gives you insights into which customers to keep and helps you to better manage them as investments. Complimentary Breakfast Seminar
Why Should A CEO/CFO Care About Customer Relationship Management?
Tuesday, September 30, 2008 7:30 – 10:00 am
Join us as we discuss: · A working definition of Customer Relationship Management. You may be surprised that it is not all about software. · Informed decision making. Imagine how access to real-time data will help you to adjust to marked conditions more rapidly. · Empowering sales people. What would happen to your sales force if you allow them to focus on customers rather than processes? · Company growth. Can it happen without customers? What are you doing differently this year to promote growth, or is last year’s growth rate acceptable? · Harnessing the Wild Wild West. Can you implement solid, time-proven best practices, or is it ok that your sales force is made up of renegades that do it their own way? · What you should expect from Customer Relationship Management software. This will include a working demo of an industry-standard Customer Relationship Management software package.
Location: Bridgewood Resort Hotel & Conference Center, Neenah, WI
To register: (920) 730-1300 or go to www.resolvcrm.com
Cost: No charge. A complete hot breakfast is included.
Who Should Attend: If you are not a SalesLogix user: Please come and talk to other SalesLogix users and see how SalesLogix can assist you with your business needs.
What is a User’s Group? The SalesLogix user group is a great place for SalesLogix users to exchange ideas and ask questions of each other and an experienced SalesLogix consultant. Meetings consist of a presentation on a featured topic, followed by “what’s new” with SalesLogix, and a question and answer period.
Location: Fond du Lac, WI
When: Wednesday, October 29, 2008 from 10:00am – 4:00pm
Agenda: 1) SalesLogix 7.5: What’s new, and should you upgrade? 2) Using SalesLogix on Mobile Phones 3) Outlook2CRM product review 4) SwiftPage new changes review 5) Soft deletion of accounts, contacts and opportunities 6) User discovered issue on merging duplicates, and a work- around 7) Resolv Support: Introducing online ticketing viewing and creation 8) Q & A Session
Register for the User Group: e-mail info@resolvcrm.com
Cost: No Charge – Lunch is included Resolv Holiday Hours
Thursday, November, 27, Thanksgiving Day – Closed Friday, November 28, Day after Thanksgiving – Closed
Wednesday, December 24, Christmas Eve, Close at Noon Thursday, December 25, Christmas Day – Closed Friday, December 26, Day after Christmas – Closed
Wednesday, December 31, New Years Eve – Close at Noon Thursday, January 1, New Years Day - Closed
Which CRM Solution? By Mike Lettier
Often, when a company reaches 25 employees, or sales revenues of several million dollars, it reaches critical mass. This prompts the company to investigate Customer Relationship Management software as a way to maintain or increase its competitiveness in today’s ever changing business environment. With all the different CRM solutions available to pick from; making the right decision can be difficult, frustrating and expensive if the wrong choice is made. So, how do you decide?
Most CRM systems share the same features, and perform pretty much the same way. While many companies simply try and fit their needs into one of these CRM systems, often it’s like putting a square peg into a round hole. Companies who approach CRM as a business strategy first, then incorporate software, find that a successful CRM solution is the result of a business partner’s clear understanding of how their business works. Development of flexible CRM tools addressing specific and unique business needs creates round pegs for round holes for these companies.
Let Resolv demonstrate how understanding and learning your business can ensure a successful CRM implementation for you. Resolv can help define your CRM strategy, and develop the road map to getting there. Let Resolv help you make the right CRM decision, so you don’t become a square peg.
SalesLogix Tips & Tricks Saving Formatted EmailThe Send SLX and Record to History buttons make it easy to insert email into SalesLogix. SalesLogix attempts to find the contact, account and even the ticket which allows us then to later peruse the communication when preparing another new proposal. This is especially helpful when a new sales rep is assigned to an account. As you know, SalesLogix stores email as plain text without any formatting. Any images contained in an email are added as attachments, after first prompting whether you wish to save them or not. If you wish that SalesLogix stored email in all it’s beauty, completely formatted with all graphics in context, you are not alone. The reasons for this approach are beyond the scope of this month’s tip, and even understanding them doesn’t change the fact that at times we do want an email stored as it was written and formatted. For example, we occasionally get an email saying (roughly): “First this screen popped up <screen shot 1> and then this error showed up <screen shot 2>. After pressing Okay the screen looked like this for 30 second <screen shot 3>. Drinking strong coffee didn’t help. Eventually this screen came <screen shot 4>.” When we read the email, it all makes sense because the screen shots are in context. Later, in SalesLogix, vital context needed to understand it has been split apart. For those times when you really want to keep the email as formatted, it can be dragged directly from Outlook to a SalesLogix attachments tab. You’ll be prompted for a description, press the okay button and your email will be saved. Double clicking the attachment in SalesLogix opens the email, complete formatted. **Provided by the Resolv Help Desk KnowledgeSync Tips & Tricks
Question:
This may be a tough one. I'm using KnowledgeSync to send out shipment confirmations, but I want to send out a confirmation only if at least one order detail line has been shipped. How do I tell KnowledgeSync to include all line items if any one line item meets the query's criteria?
Answer:
That is a good one! By default, if a record - such as a line item - does not meet a query's criteria, that record will not be included in the alert. But there is a way to handle this:
1) Create a Crystal Report whose output is the shipment confirmation. The report should have a single "parameter" (selection criteria) and that would be on the order number.
2) Create a KnowledgeSync query; the only table you're going to need is the order line item table (unless you need to filter on values from other tables).
3) Your query will have 2 columns; the first column will be the "unique" field from the order line table and the second column will be the order number. For the unique field, change the Column Type to "Count".
4) Go to the Filters tab and put in all the filters you need.
5) Go to the Sub Filters tab and add the "count" field as the sub filter. Choose an operator of "greater than or equal to" and a compare value of '1' (without quotes).
This query will "count" the number of line items on any given order that meet your shipping criteria. If an order contains at least one item that meets the criteria, a single record is added to the result set -- and that record shows the order number.
6) Go into your event and go to the Reports tab. Add the report that you created in step #1. At the bottom of the Reports tab, the report parameter (e.g., "enter order number") appears. In the "Answer" field, choose the query field that contains the order number.
Here's how the event works:
The query runs and generates a list of all orders that have at least one detail line that meets your criteria. (E.g., 3 orders) The event takes over. The first order number is passed into your Crystal Report, the shipment confirmation is generated, and is delivered to the client. KnowledgeSync then repeats that process for matching orders 2 and 3.
**Provided by VineyardSoft Corporation (www.vineyardsoft.com)
Here is how to contact our tech support department: Normal tech support hours are Monday through Friday 8:30 am – 4:30 pm Central Standard Time. Help may be available during non-business hours for an incidence fee. If it is an emergency or after hours, please call, since we cannot guarantee that email will be responded to prior to the next business day. During business hours, phone calls have priority over email.
Phone: (920) 268-4877
E-mail: support@resolvcrm.com
Remote live support: http://www.resolvcrm.com/assist
Web ticket: http://www.resolvcrm.com/supportquestions.html
"Confidence is going after Moby Dick in a rowboat and taking the tartar sauce with you."
~ Zig Ziglar Our Referral Program Resolv, Inc. is always looking for referrals, but what bonuses do you receive if you give us a referral?
To Read More on our Referral Program, Click Here
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