Part 1
Theoretical Analysis
1.What is CRM?
Ans. Customer relationship management (CRM) is a strategy that companies use to
manage interactions with customers and potential customers. CRM helps organizations
streamline processes, build customer relationships, increase sales, improve customer
service, and increase profitability.
A CRM system is a software application that helps companies manage their customer
data and interactions. CRM systems typically include features for contact management,
lead tracking, sales forecasting, and customer support.
The full function of CRM includes:

Tracking customer interactions: CRM systems track all customer interactions, including
phone calls, emails, web visits, and social media posts. This information can be used to
improve customer service, identify opportunities for upselling and cross-selling, and
build stronger relationships with customers.

Managing customer data: CRM systems store all customer data in a central location.
This data can be used to create detailed profiles of customers, which can be used to
personalize marketing campaigns and improve customer service.

Automating sales and marketing processes: CRM systems can automate many sales
and marketing processes, such as lead generation, lead scoring, and customer followup. This can free up sales and marketing teams to focus on more strategic tasks.

Improving customer service: CRM systems can help improve customer service by
providing agents with access to customer data and by tracking customer interactions.
This information can be used to resolve customer issues more quickly and efficiently.
CRM is a valuable tool for businesses of all sizes. By implementing a CRM system,
businesses can improve their customer relationships, increase sales, and improve
customer service.
2. Significance of customer life cycle - customer acquisition, customer retention,
customer development
Ans.
The customer lifecycle is the journey that a customer takes from the moment they first
become aware of a product or service to the moment they become a loyal advocate. It
is divided into three main stages: acquisition, retention, and development.
Customer acquisition is the process of attracting new customers to your business. This
can be done through a variety of channels, such as advertising, marketing, and public
relations. The goal of customer acquisition is to generate leads and convert them into
paying customers.
Customer retention is the process of keeping existing customers coming back for more.
This can be done by providing excellent customer service, offering loyalty programs,
and launching new products and services that meet the needs of your customers. The
goal of customer retention is to reduce churn and increase customer lifetime value.
Customer development is the process of deepening the relationship with your existing
customers. This can be done by providing additional value, such as training, support, or
consulting. The goal of customer development is to turn customers into promoters who
will refer your business to others.
The significance of the customer lifecycle is that it provides a framework for
understanding the different stages that customers go through as they interact with your
business. By understanding the customer lifecycle, you can develop strategies to attract
new customers, retain existing customers, and develop deep relationships with your
customers.
Here are some of the benefits of understanding the customer lifecycle:

Increased customer satisfaction: When you understand the customer lifecycle, you can
identify the different touchpoints that customers have with your business and make sure
that they are positive experiences. This can lead to increased customer satisfaction,
which can lead to repeat business and referrals.

Improved sales performance: When you understand the customer lifecycle, you can
identify the different stages that customers are in and target your marketing and sales
efforts accordingly. This can lead to improved sales performance.

Reduced costs: When you understand the customer lifecycle, you can identify the
different costs associated with each stage and find ways to reduce those costs. This
can lead to reduced costs and increased profits.

Improved decision-making: When you understand the customer lifecycle, you can make
better decisions about product development, marketing campaigns, and customer
service. This can lead to improved customer satisfaction and increased profits.
3. What is Customer Life Time Value and what is it's general trend in the customer life
cycle?
Ans. Customer lifetime value (CLV) is a measure of the total revenue or profit a
company expects to generate from a customer over the course of their relationship with
the company. It is calculated by taking the average revenue or profit per customer and
multiplying it by the average length of the customer relationship.
The general trend of CLV in the customer lifecycle is that it increases over time. This is
because, as customers become more familiar with a company's products or services,
they are more likely to continue doing business with the company and to spend more
money.
However, there are some factors that can affect the trend of CLV in the customer
lifecycle. For example, if a company introduces new products or services that are more
expensive, CLV may decrease in the short term. However, if the new products or
services are successful, CLV may increase in the long term.
Here are some of the factors that can affect CLV:

Customer acquisition cost: The cost of acquiring a new customer can have a significant
impact on CLV. If the cost of acquisition is high, then CLV will need to be higher in order
to make a profit.

Customer retention rate: The customer retention rate is the percentage of customers
who continue doing business with a company after their first purchase. A high customer
retention rate will lead to higher CLV.

Average purchase amount: The average purchase amount is the amount of money that
a customer spends on a single purchase. A higher average purchase amount will lead
to higher CLV.

Customer lifetime: The customer lifetime is the average length of time that a customer
does business with a company. A longer customer lifetime will lead to higher CLV.
4. What is Net Promoter Score?
Ans. Net Promoter Score (NPS) is a customer loyalty metric that measures how likely a
customer is to recommend a company's product or service to others. It is calculated by
asking customers a single question: "How likely are you to recommend our company to
a friend or colleague?" Customers are then asked to rate their likelihood on a scale of 0
to 10, with 0 being "Not at all likely" and 10 being "Extremely likely."
NPS scores are then divided into three categories:

Promoters: Customers who give a rating of 9 or 10 are considered promoters.
Promoters are the most loyal customers and are likely to continue doing business with
the company and to refer others to the company.

Passives: Customers who give a rating of 7 or 8 are considered passives. Passives are
satisfied with the company's products or services, but they are not necessarily loyal.

Detractors: Customers who give a rating of 6 or lower are considered detractors.
Detractors are unhappy with the company's products or services and are likely to switch
to a competitor.
The NPS score is calculated by subtracting the percentage of detractors from the
percentage of promoters. For example, if a company has a 50% promoter score and a
10% detractor score, then their NPS score would be 40.
5. What research questions can be asked to find NPS?
Ans. Some of research questions that can be asked to find NPS:

What are the most important factors that influence your decision to recommend our
company to others?

What could we do to improve our product or service so that you would be more likely to
recommend us?

What are your biggest pain points with our product or service?

What are your biggest areas of satisfaction with our product or service?

What would you tell a friend or colleague about our company?
6. Who are promoters, detractors and passives?
Ans. Promoters, passives, and detractors are three categories of customers used in Net
Promoter Score (NPS) surveys. They are classified based on their answers to the NPS
question: "How likely are you to recommend our company to a friend or colleague?"

Promoters: Customers who give a rating of 9 or 10 are considered promoters. They are
the most loyal customers and are likely to continue doing business with the company
and to refer others to the company.

Passives: Customers who give a rating of 7 or 8 are considered passives. They are
satisfied with the company's products or services, but they are not necessarily loyal.

Detractors: Customers who give a rating of 6 or lower are considered detractors. They
are unhappy with the company's products or services and are likely to switch to a
competitor.