Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Marketing Analytics > 4: Analytics for Customer Management > Flashcards

4: Analytics for Customer Management Flashcards

1
Q

What is Database Marketing?

–>driving force of Customer Management

A

is the use of customer databases to enhance marketing productivity

by more effective acquisition, retention and development of customers

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

What is Customer management?

A

View and strategy where customers are clustered into portfolios –>maximize customer value

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

When is CRM relevant?

A

Especially relevaant if:
- Frequent customerr interactions
- High expertise for purchasing is required
- Multiple products are purchased

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

What is CRM?

A

= analysing marketing databses and leveraging communication technologies to apply methods to maximize individual CLV

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Customer centricity and segmenting

A
  • Focus on Custoemr centricity
    1. segmenting customers based on acquired information regarding CLV
    2. Heterogenous segments, different to each other
    3 inside homogenous Same characteristics
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

How to apply CRM?

A
  1. usage of CRM software to track activity
    2 select profitable customers and develop relationships
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

What is customer equity?

A

total discounted lifetime values of all customers of the firm

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

CLV quantifies

A

quantifies long-term value of a customer to the firm

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Why is expected CLV important?
also in context of customer centricity

A
  • reaching customers that have a high potential value
  • avoid wasting money by spending too much on customers with low potential

–>Customer centricity: looking at each individal customer in the marketplace in terms of potential value

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

What are the basic components needed to calculate CLV?

A
  • Business must be contractual or must be able to tie purchases to individual customers
  • need CRM that: stores customers, revenues, expenditure
  • obtain useful discoount rate
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Advantages of CLV?

A
  • Management of customer relationship as an asset
  • Measurement of customer loyalty
  • Focus on long-term value of customers
  • Monitoring of impact of managmenet and marketing invest. on the value of customer assets
  • determination of optimal level of investments in marketing and sales
  • Basis fo customer selection and customer-specific communication strategies
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

What signals the CLV to Customer Acqusition ratio?

A

it is a signal of customer profitability, and of sales and marketing efficiency

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

CLV|CAC ratio interpretation ranges?

A
  • ratio < 2 –>bad ratio: Business is bleeding money
  • 2 < ratio < 3 –>good ratio
  • = 3 –>benchmark (very good ratio)
    >3     –>Harvesting cash because business cannot grow anymore
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

What is the Initial goal of customer acquisition? (Customer selection)

A

The initial goal is to select the right prospect for the acquisition campaign

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Process in Customer selection
RFM method

A
  1. Use RFM model that summarizes past consumer behavior
  2. Assumption: right cusotmer in the futue similar to right customer in the past
  3. Build groups of customers based on RFM characteristics
  4. Assign probabilities to each group in accordance with its differential response behavior –>and prioritize
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

What is an alternative model to RFM for customer selection?

A

Alternative: probability models in which prob that a cusotmer will react to an invitiation is related to his behavirpporal characteristics

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

What is the main challenge of probability models in customer acquisition?

Proability models?

A

main challlenge: is that the transaction history is not available for prospects

—>Consider clickstream data which entails information about customer environment in an online shopping environment

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

What is done after the decision on which customer to focus on?

A
  1. Decision which customer to focus on

–>adequate resource allocation
2. leverage customer acqusition

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

What are the acquisition channels?

A
  • Personal selling
  • Mass media
  • Direct marketing channels
  • Internet
  • Retail outlets

–>Use of different messages to attract different customers

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

What is customer retention?

A

customer retention focuses on preventing customer attrition or churn
- loalty/reward programs
- Churn prediction models

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

Churn prediction models:
What is churn meaning on the customer and firm level=

A

customer level refers to the probability customer leaving the firm

Firm level: is the percentage of the firm´s customer base that leaves in a given time period

22
Q

Do loyalty programs have an effect?

A

Consuemer participation in loyalty programs continous to increase

But: no agreement on whether loyalty programs have a positive impact on cusotmer retention

23
Q

What are the two types of Churn prediction models?

A
  1. non-contractual setting
  2. contractual setting
24
Q

What is the challenge of Non-contractual setting in Churn prediction models?

A

Challenge: to infer wheter a cusomter is still active or not

–>probability models to asses whether a customer is still alive

25
Q

What is the contractual setting in Churn prediction models?

What is the churn problem

A

custiomer churn: termination of the contract between firm and customer

Churn problem is traditionally stated a binary issue
–>it aims to predict whether a customer is likely to defect during a pre-given period

26
Q

What does the two-stage least square model developedl by Reinartz el al(2005) balance?

(What are the 3 models it consists of?

A

balance acquisition and retention resoueces in order to maximize customer profitability

  1. Acquistion model
  2. Relationship duration (retention model)
  3. Customer profitabilty model
27
Q

How does the Retention model work?
2 of the 3 models from *probit two-stage least square model
(what is the length of the relationship with company?=

A

the duration of the relationship with the firm is influenced by the amount of money that is spent on retention, the contact channels, ( frequency of transaction, degree of cross buying)

28
Q

What do the 3 equations of the 3 model of the retention and profitability model? by reinart et al (2005) (Two-stage least square model) form?

A

–> the 3 equations together form a recursive simultaneous system

–>The equations are conditional regressions detemrmined partly by the acquisition liklihood of a customer

29
Q

Why is it important for coompanies to find the right balance between acquisition and retention?

A

acquisition is significantly more expesive —> retention is important to any business

–>balance acquisition of new customer and retention of old customers

30
Q

What are the main finding os the two-stage model of reinart et al 2005)?

A

Many of the communication channells have the same effect on duration as on acquistion

–>the duration of a relationship is correlated with the liklihood of acquiring a customer which means that a customer who is more likely to be acquired is also expected to engage in a longer relationship with the firm

31
Q

What are the defintion of the 3 steps in the Customer Journey process? (Stages, Channels, Touchpoints)

A

Stages: pre-purchase, purchase, post-purchase
Channels: customer contact point, or a medium through with cust and firm interact (offliine, online, mobile)
Touchpoints. episodes of direct or indirect contact with a brand or firm

32
Q

What was the traditional Customer Journey?

A

Prospect engaged and moved through the funnel in predictable, linear stages

  • People started at the same period (i.e. similar level of knowledge
  • and were methodically guided through the process

–>company controlled the brand, message, conversation and buying process

33
Q

The components of the traditional funnel? (5)

A
  1. Awareness
  2. Familiarity
  3. Consideration
  4. Purchase
  5. Loyalty
34
Q

What is the big challenge for companeis in digital customer live journey?

A

Big challenge:
–>Numerous digital and non-digital channels used by customer to obtain information and impression about product or service

–>variety of channels makrs it difficult for companies to track the customers journey

35
Q

What is the Role of channels in the Customer Journey?

A

Channels differ in benefits and costs –>However, these differences are shrinking due to technological developments and diffusion of new channels

Specific multichannel segments can be identified that differ in terms of consumer characteristics

36
Q

why are channel choices in the purchase funnel affected by each other?

A

channel choices in the purchase funnel are affected by one antoher because of
- lock-in effects
- channel inertia and
- cross-channel synergies

37
Q

What the 2 types of customer journey ?

A

customer journey depends on both product category and the individual

38
Q

FOr what is customer journey analctics used?

A

used to understand customer purchasing behavior

39
Q

Customer Journey: What is idea behind product category?

A
  • spillover effect from TV advertising to online chatter is stronger for hedonic than utilitarian products
  • Products wwith experiential value and cheap prices compared to shipping costs, are preferably bough in physical stores
  • Mobile devies used to purchase habitual products
40
Q

Customer Journey: What is the idea behind individual category?

A
  • Scholars account for customer heterogeneity in their models
  • not all customer more through all custoomer journey stages
  • Multiple multichannel customer segment identified by research
41
Q

Why is CLV no longer suffient?

A

CLV is no longer sufficient for business success

  • People place high value on relationships and conversations
  • Customers should be in the center of company
42
Q

What is the total customer engagement value?

A

Total customer engagement value = Lifetime + Refferral + Network + Knowledge value

43
Q

What are the 3 parts of Customer Management in Enterprise today?

A
  • Voice of the customer
  • Customer experience transformation
  • Customer contact strategy
44
Q

What is the method Voice of the customer?

A

= method by which expressed and unexpressed customer wishes are identified and transformed into quantified,structued and evaluated customer requirements

Collect throug:
- Questionaire
- Publlic comments in social media
- Customer interview

45
Q

Key fact about Voice of Customer

A

Voice of customer…

  • combines qualitative with quantitative analysis
  • sets clear priorities
  • analyzes journeys and touchpoints
  • involves employees in closing the loopp
46
Q

What is Customer contact strategy?

A

defines *how, when, why and what you will communicate to your customers at each stage of the customer journey

–>develop process and purpose for customer contact through the organization

47
Q

What is the goal of Customer contact strategy`?

A

Goal: optimize the customer experience for different customer segments through out the whole customer journes

48
Q

What are the design strategies for each type of customer contact?

A

Simplify: Irritable to customer, valueable to you, make these tasks easier to do
Encourage: Valueable to customer, valueable to you, spend more time on these conversations
Eliminate: Irritable to customers, irritablle to you; fix the cause of these conversations
Automate: Valueable to customers, irritable to you; prodive low touch self-service

49
Q

What are the building blocks of customer experience transformation? (A-C)

A

A. Build aspriation and purpose: set aspiration and purpose including clear definition of value at stake

B. Transform the business: Redesign/innovate and implement product/servie experience along proven discover-design-deliver approach

C. Establish critical enablers: to drive transformational change via mindsets, behaviors and capabilites

A and B are potential starting points

50
Q

Customer Experiene Transformation: Customer Journey Analytics
3 Steps

A

Touchpoint optimization: operational excellence
Process optimization: Service excellence
Customer Jobs & Outcome optimization: value excellence

51
Q

Traditional Customer journey:
How did messaging and distribution of product work

A

Messaging occurred through traditional one way channels ( Tv, print)

Distribution of product through brick and mortar channels

Marketing Analytics (9 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions