Types of Customer Relationship Programmes:

There are four types of Customer Relationship Programmes that enables the company to Win back customers who have defected or planning to create loyalty among existing customers. They are

1. Win Back or Save:

This is the process of convincing a customer to stay with the organization while they are discontinuing service or convincing them to rejoin once they have left. Of the four categories of campaigns, win back campaigns is four times more likely to succeed, if contact is made within the first week following a defection that if it is made in the fourth week.

Selectivity is another aspect of a successful win back campaign. Leading organizations often filter prospects for contacting to exclude customers who have frequently switched , who have bad credit ratings or whose usage is low.

To preserve the revenue stream and prevent the customer from becoming a “traditional” win back candidate, a few organizations are now including partial disconnects and reduced usage customers in their win-back campaign.

2. Prospecting:

Prospecting is the effort to win new, first time customers. Apart from the offer itself, the three most critical elements of prospecting campaign are segmenting, selectivity and sources. It is essential to develop an effective-need based segmentation model that allows the organization to effectively target the offer. Without this focused approach, the organization fails to achieve an adequate acceptance on the offer or spends too much on promotions, advertising and concessionary pricing.

Selectivity is important to prospecting as it is to win back. Need-based segmentation defines what the customer wants from the organization and profit-based segmentation defines how valuable the customer is and helps the organization decide how much it is willing to spend to get the customer. Pre-scoring a consumer credit rating is one of the techniques that organization can use to determine the latter.

3. Loyalty:

Loyalty is the third category in which it is most difficult to gain accurate measures. The organizations trying to prevent customers from leaving, uses three essential elements: Value based and Need based segmentation and predictive churn models. Value-based segmentation allows the organization to determine how much it is willing to invest.

Once the customer is determined to belong to the value based segmentation screening, the organization can use need-base segmentation to offer customized loyalty program. Affinity programs such as airline miles and hotel points are some of the most popular methods. However, the organization focus more on needs of individual customers, they find that they are able to achieve the same loyalty with less investment.

4. Cross Sell / Up-sell :

The Cross –sell/ Up sell is also known as increasing the wallet share or the amount the customer spends. The purpose is to identify complementary offerings that a customer would like. For instance, a basic long-distance customer could be a candidate to buy internet access. Up selling is similar but, instead of offering a complementary product, the organization offers an enhanced one. For example, If the customer has used his credit card a few times in apparel shop. CRM tool will enable the credit card company to send his customized mailers on apparel offers including special incentive schemes.

Cross- Sell and Up-sell campaigns are important because the customers targeted already have relationship with the organization. In financial terms, when a customer accepts a cross –sell or up-sell offer, that organization begins to reap more profits.