Segmenation and customer profiling and wallet share - Essay Example

Segmenation and profiling and wallet share September 25, Segmenation and profiling and wallet share As a part of the relation management (CRM), it is important that data should be arranged in segments that best describe customer’s attributes. Accordingly, segmentation is done by attributes such as customer income, buying habits, customer spend, wallet share, demographics and so on (Abramowicz, 2010). Such segmentation helps in customer acquisition and retention and developing marketing plans directed towards high spending customer groups.

Many segmentation applications are available as off the shelf products and the most commonly used are tapestry segmentation, Prizm and Mosaic (Mello, 2002). Customer profiling and analytics is an advanced database management system with works with customer segmentation and data mining applications. With customer profiling tools, customer information such as who are they, places where they reside and work, distance travelled to purchase products, their differences by products and regions and so on (Bhalla, 2009).

With this information, it is possible to identify areas where customers are in higher intensity, understand viability of the locations and then develop campaigns that focus on the target customers (Drupal CRM, 2011). Wallet share measures the end result of the CRM implementation. It refers to the percentage or share that the customer spends on purchasing a particular product. It can also refer to the amount of revenue that a firm generates from a specific customer segment. In effect, the wallet share shows if the amount spent on maintaining customer relations and on advertisements are effective enough to make the customer buy the organizations products.

In the case, the CRM system tracks the billing to the customer segment and after hundreds of transactions are tracked, a decision is taken about the share of wallet. Wallet share information can then be used in changing the marketing plan, in targeting the proper customer segment and so on (Croteau, 2009). These systems are used in modern database marketing and in CRM.ReferencesAbramowicz, Witold. “Business Information Systems: 13th International Conference, BIS 2010’. 2010. New York: Springer-Verlag. pp. 101 Bhalla, Subhash.

"Databases in networked information systems: international workshop DNIS 2000". 2009. New York: Springer-Verlag. pp. 3-4Croteau, Alfered. "Critical success factor of CRM technological initiatives". Canadian Journal of Administrative Sciences, 20(1). 2009. pp. 21-34Drupal CRM. "Customer profile system". 2011. Drupal eCommerce. 25 September, 2011. http://www.drupalcommerce.org/administrationMello, Sam. “Customer centric product definition: The key to great product development”. 2002. New York: AMACOM