Customer LifeCycle Management SM Tap into YOUR hidden potential with

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Customer LifeCycle ManagementSM

Tap into YOUR hidden potential with

DPS PerfectCircle Suite of Marketing Capabilities

<Month Day, Year>

<Your name>

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…How can you be sure you are optimizing your marketing investment

whenthere is a lot of options, a lot of confusion, and…

Data Modeling

Profiling

Intelligent offers

Vary the media

Web marketing

Point of Sale merchandising Surveys

Actionable data

Owner RewardsKey tags

Coupon booklets Gift cards

CRM

Gender based marketing

Database marketing

Incentives

Sales Force Automation

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How do you make an informed decision that’s right for you?

…and, a lot of cookie cutter programs.

Data Modeling

Profiling

Intelligent offers

Vary the media

Web marketing

Point of Sale merchandising

Surveys

Actionable data



CRM


Database marketing

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And, with everyone buying essentially the same technology, where is the competitive advantage to be found?

…a lot of cookie cutter programs.

Data Modeling

Profiling

Intelligent offers

Vary the media

Web marketing

Point of Sale merchandising

Actionable data



CRM


Database marketing

Sales Force Automation

Surveys

Incentives

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Data ModelingData Modeling

ProfilingProfiling

Intelligent offersIntelligent offers

Vary the mediaVary the media

Web marketingWeb marketing

Point of Sale merchandisingPoint of Sale merchandising

Actionable dataActionable data

Owner RewardsOwner RewardsKey tagsKey tags

Coupon bookletsCoupon booklets Gift cardsGift cards

CRMCRM

Gender based marketingGender based marketing

Database marketingDatabase marketing

Sales Force AutomationSales Force AutomationSurveysSurveys

IncentivesIncentives


ProfilingProfiling








CRMCRM





What do you do?

Here’s a start…

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First, begin by understanding how consumers behave throughout their life

cycle.

Accenture 2004

Not including non-traditional after-sales products/services…

CONSUMER

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Then, Implement a Customer Life Cycle Management Strategy That…

• …Integrates your marketing communications• …Can be sustained

• …Lowers per unit M&A costs

• …Is designed to leverage consumer behavior

• …Keeps your options open with “flexible customization”

• …Provides measurable performance improvement beyond traditional metrics

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As it relates to Customer Relationship Management (CRM), customer LifeCycle Management (CLM) is used to describe the progression of steps a consumer goes through when: considering, purchasing, using, and maintaining a vehicle.

The goal of lifecycle management is to pro-actively move the consumer through the cycle again and again by defining the way in which an enterprise interacts & communicates with its customers and prospects at each phase of the life cycle.

What is Customer LifeCycle ManagementSM ?

CONSUMER

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Why is LifeCycle management important?

$ 1445 GP per unit

30% of GP is consumed in ad costs

Because current practices are a “going out of business” strategy!

$ 493.00

$ 8.3 Billion is spent each year in conquest advertising.

Customer retention remains around 30%

STOP the Madness!

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• Marketing and Advertising is the second largest business expense

• 88% of the Marketing & Advertising dollars are spent in Mass-Media

• Marketing & Advertising consumes 25% - 30% of the average new vehicle gross profit

• Front end acquisition rates typically yield 50% capture of the total advertising influenced prospect base

• 40% of “New” customers never generate a CP repair order

• 70% of the customers “defect” within the first 3 years of ownership

• Less than 15% of annual sales are to repeat customers YET -

• 20-25% of their customer households will purchase a vehicle annually

For the average franchised New Vehicle Dealer:

Why is LifeCycle Management important?

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• Customer service intervals are more expansive

•Many BMW Service centers are at capacity

•Must maximize each visit / opportunity

•Vehicles are built better and have more complex systems

•Less parts sales

•More computer programming repairs versus additional parts or labor sales

• Co-op funding going untapped – why solicit more if you can’t handle it?

•Need ability to consistently build value in the breadth and quality of BMW products & services

•Accessories, Lifestyle & boutique items, warranties, etc.

For the average BMW Center regarding Aftersales:

Why is LifeCycle Management important?

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Performance improvement:

What are the benefits of CLM?

Capture and convert more opportunities,

Reduce M & A expense and Improve profitability,

Improve customer satisfaction,

Improve overall customer retention and loyalty,

18% to 225% increase in unit sales

4% to 60% improvement in retention

2 to 15 point improvement in CSI

As much as 25% improvement in enterprise profitability

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ProfilingProfiling








CRMCRM






ProfilingProfiling








CRMCRM





So, if you do it… Should you own it, OR outsource it?

Let’s take a look at the facts…

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Own it!Business Development Centers

75% of BDC’s fail within 6 months!

Why?1. Cultural norms

2. Short term mindset (see #1)

3. Not a core competency (see #1)

4. High employee turnover (see #1)

5. Difficult to sustain

6. It looks easy to do

Bottom line:

Business development through database marketing is a sophisticated process requiring a

long-term commitment.

V.S.Cultural

Mindset

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Outsource it!Contracted Marketing Services

Measurable performance improvement, without the high cost of people, technology, and compliance

management.Why?1. Dealer stays focused

2. Dealer can invest in core competence versus start-ups (see #1)

3. This IS a core competency of an outside firm (see #1)

4. Reduces legal risk (see #1)

5. Sophisticated and scalable technology (see #1)

6. If it were easy to do, everyone would do it.

Bottom line:

Outsourcing enables dealers to remain focused on execution, not on non-core functions.

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• Actionable data

• Timely and relevant, customer-centric communications

• Consistent delivery of quality interactive processes and,

• Ability to demonstrate and quantify the value each customer derives from the relationship.

How to Get Started

Four essential elements for Customer LifeCycle Management:

How ready are you?

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CLM Dealer Readiness Assessment

CLMSM Implementation Requirements – Assessment Yes No

Actionable Data Ability to collect consumer data at point of interaction or transaction (fixed ops) ? NCOA (National Change of Address) purification process X CASS Certified (Coding Accuracy Support System) X FTC and State DNC purification X De-duped lists X E-mail address (DPS can assist in collection) ?

Timely/Relevant Customer-Centric Communications Ability to extract, normalize, and segment customer data from DMS X Algorithms used to predict in-market timing X Dynamic, “smart”, customer/model specific incentive capability X Consistent brand imaging and messaging ? Flexibility in communicating in customer’s channel of choice (see Actionable Data) X On-demand flexibility in type of media and creative design X

Quality Interactions That Support Desired Brand Image Consistent delivery of quality interpersonal customer interactions (fixed and sales) X Consistent face-to-face delivery of message X Process for garnering un-biased customer feedback ? Process for quickly acting upon customer feedback (DPS assists) X ? Escalation processes for resolving customer concerns ?

Ability to Quantify and Demonstrate Delivered Value Process for quantifying value of goodwill/policy at POS within the DMS ? Process for capturing quantified value ? Mechanism for demonstrating and communicating the cumulative value delivered

to the customer X

CLMSM Implementation Requirements – Assessment Yes No

Actionable Data Ability to collect consumer data at point of interaction or transaction (fixed ops) ? NCOA (National Change of Address) purification process X CASS Certified (Coding Accuracy Support System) X FTC and State DNC purification X De-duped lists X E-mail address (DPS can assist in collection) ?

Timely/Relevant Customer-Centric Communications Ability to extract, normalize, and segment customer data from DMS X Algorithms used to predict in-market timing X Dynamic, “smart”, customer/model specific incentive capability X Consistent brand imaging and messaging ? Flexibility in communicating in customer’s channel of choice (see Actionable Data) X On-demand flexibility in type of media and creative design X

Quality Interactions That Support Desired Brand Image Consistent delivery of quality interpersonal customer interactions (fixed and sales) X Consistent face-to-face delivery of message X Process for garnering un-biased customer feedback ? Process for quickly acting upon customer feedback (DPS assists) X ? Escalation processes for resolving customer concerns ?

Ability to Quantify and Demonstrate Delivered Value Process for quantifying value of goodwill/policy at POS within the DMS ? Process for capturing quantified value ? Mechanism for demonstrating and communicating the cumulative value delivered

to the customer X

Typical Results

Doing it yourself is

more difficult than it

appears!

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Own it VS. Outsource it?Conclusion

There is too much at stake to Own it.

Stay Focused… Outsource it.

How to select the best provider1. Experienced

2. Flexible

3. Quick to adapt

4. Innovative

5. Creative

6. Proven track record

7. Ensures alignment with YOUR business objectives

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Introducing DPS’ PerfectCircle customer LifeCycle Management

Those who deliver the best possible consumer Shopping, Buying and Ownership experience…

WIN!WIN!

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PerfectCircle CLM Strategy

Traditional “Retention Marketing”Cookie cutter

Sold on price or other traditional metrics

Activity based

Focused on reminders, and traditional call center activity

Service dept focused

Not integrated with total marketing and advertising strategy

In what way is PerfectCircle CLMSM different?

On Line On Line AdminstratorsAdminstrators

Options:

Flexible

Aligned with business objectives

Unique, Flexible, & proactive

Enterprise wide solution

Integrated communications

Permission based

Consumer behavior driven

Quantifies value for consumer

Facilitates shift in budget for no incremental expense

Options:

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Innovative Thinking The ONLY CLM company in the automotive retailing industry (we own the trademark)

The FIRST company to offer bundled communication capabilities oriented around consumer behavior

The FIRST company to offer flexible fee structures

The ONLY company to offer complete customization of the program

The ONLY company to offer integrated marketing communications with a plug-n-play owner rewards program

The ONLY automotive focused DB marketing firm to bundle all of this with personal owner web pages

Why DPS?

Clear Solutions

Measurable Results

Simple to understand suite of capabilities

Marketing strategies developed according to dealer objectives and unique market conditions

Hands-off, turn-key services that can be customized to individual preference

Marketing programs aligned and held accountable to dealer business objectives

The ONLY company to offer pre, and post implementation retention performance benchmarking

The ONLY company to offer performance reporting that is available in hard copy, e-mail , fax, and secure web based access to real-time data-driven reporting

Personalized, monthly service consultations and program adjustment recommendations

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• Federal and State

Compliance filters

• Customer info & address

standardization

• De-duping customer

records

• Customer & vehicle

records and history

• Op-code normalization

• NCOA

• CASS Certification

• Customer profiling

• Customer segmentation

• Predictive data modeling

• 3rd party list management

DB Management DB Management ServicesServices

• DPS client engagement

and business case

development model

• Benchmark measurement

and follow-up

• Monthly performance

reports

Benchmarking Benchmarking ServicesServicesCustomer LifeCycle Management ServicesCustomer LifeCycle Management Services

AcquisitionAcquisition RetentionRetention RenewalRenewal Owner RewardsOwner Rewards

• Voice of the Customer –

Service Follow-up

• E-mail “Smart Surveys”

• New sale thank you and

service introduction

• Maintenance reminders


non-responder

• Major service thank you

• E-mailed communications

• Mycarpoints.com

personal owner webpages

• Owner rewards program

• Key tags

• Service Maintenance

books

• On demand campaigns

• Performance reporting

• Voice of the Prospect –

Shopper Contact

• Acquisition direct mail

marketing

• Dealer Advance lead

management system

• E-mail Direct Marketing

• On demand campaign

management


• Voice of the Customer

Reactivation

• Reactivation mail

• New vehicle sales

campaign



• Promotional kit

• Welcome kit

• Point accrual, tracking,

account and redemption

management

• MyCarPoints.com

personal owner web

pages

The 4 Cornerstones of Customer LifeCycle ManagementThe 4 Cornerstones of Customer LifeCycle Management

• Federal and State

Compliance filters

• Customer info & address

standardization

• De-duping customer

records

• Customer & vehicle

records and history

• Op-code normalization

• NCOA

• CASS Certification

• Customer profiling

• Customer segmentation

• Predictive data modeling

• 3rd party list management

DB Management DB Management ServicesServices

• DPS client engagement

and business case

development model

• Benchmark measurement

and follow-up

• Monthly performance

reports

Benchmarking Benchmarking ServicesServicesCustomer LifeCycle Management ServicesCustomer LifeCycle Management Services

AcquisitionAcquisition RetentionRetention RenewalRenewal Owner RewardsOwner Rewards


Service Follow-up

• E-mail “Smart Surveys”

• New sale thank you and

service introduction

• Maintenance reminders


non-responder

• Major service thank you

• E-mailed communications

• Mycarpoints.com

personal owner webpages

• Owner rewards program

• Key tags

• Service Maintenance

books



• Voice of the Prospect –

Shopper Contact

• Acquisition direct mail

marketing

• Dealer Advance lead

management system

• E-mail Direct Marketing

• On demand campaign

management


• Voice of the Customer

Reactivation

• Reactivation mail

• New vehicle sales

campaign



• Promotional kit

• Welcome kit

• Point accrual, tracking,

account and redemption

management

• MyCarPoints.com

personal owner web

pages

The 4 Cornerstones of Customer LifeCycle ManagementThe 4 Cornerstones of Customer LifeCycle Management

DPS Portfolio Map

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•Integrated communications •Sustainable

•Lowers per unit costs•Aligned with behavior

•Keeps options open: (Flexible Customization)

PerfectCircle CLM Capabilities

Database Management

Acquisition

Retention

Renewal

Owner Rewards

More ProfitableProfitable Customer MarketingMarketing Starts Here

ProfitableProfitable Customer RelationshipsRelationships Continue Here

LoyalLoyal CustomersCustomers Developed Here

LoyalLoyal CustomersCustomers Kept Here

ProfitableProfitable BusinessBusiness Enabled Here

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Database ManagementCreating actionable data and discovering hidden potential

Mitigates legal compliance risk

Keeps data “actionable”

Reduces costs

Daily extraction enables relevant/timely communications

“Mines” hidden potential

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Data Extraction Scope

• F&I – (Vehicle records from the previous 60 months)

• Service – (Repair order records from the previous 18 months)

• Ops – (Service op codes)

• Vehicle History – (Vehicle)

• CUS – (Customer) R&R ERA, and ADP Elite only

Database Management

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Acquisition

Managing the Shopping Experience

SHOPPING SHOPPING EXPERIENCEEXPERIENCE

SALES PROCESSSALES PROCESS

CONSUMER

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Find and Capture Find and Capture More!More!

Acquisition

In partnership with

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Finding and selling to more customers

The “Gap” is the difference between today’s performance and the potential to optimize the revenue opportunities from prospects and customers alike.

SHOPSHOP BUYBUY

Acquisition

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Stronghold and DPS are the industry leaders in closing the Gap. We make it…

SimpleSimple SeamlessSeamless SustainablSustainablee

SHOPPING SHOPPING EXPERIENCEEXPERIENCESHOPSHOP BUYBUY

Acquisition

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AcquisitionMarketing Logic

•“In-Brand” owners are targeted with a special offer designed to introduce them to Service Dept.

•Responders are automatically placed into the Retention Module.

•Non-Responders are placed in the Service Prospecting database for future “On-Demand” (OPTIONAL) events.

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INTERNET TELEPHONE

Actionable data

CLM CUSTOMER DATABASE

CLM CUSTOMER DATABASE

360o view of all customer activity from any device connected to the DealerAdvance™ network.

WALK-INS

But data, by it’s self, is not enough.

EXISTING CUSTOME

R BASE

3rd PARTY LISTS

Acquisition

Data is captured in a PC, or wireless PDA integrated with the system.

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It’s the interactive processes which

determine success.

Take a Look At the Next Level of Dealership Performance: DealerAdvance™ Sales demo.

DealerAdvance™ functionality with its built-in Sales Force Automation enables a consistent and auditable follow-up process across all channels.

Acquisition

Interactive Processes

http://strongholdtech.com/HTML/dealer_advance/demo.html

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Attack ShowroomTraffic-Wireless PDA-Driver’s License Scanning-Reverse Phone Lookup-Follow-up task assignment

Optimizing Prospects & Customers Actionable Data

Leverage Phone Ups-Integration to Who’s Calling and Call Bright-Prospect initiated via PDA-Task assignment

Improve InternetYield-Fast automated response-Task follow-up via CRM

Mine Owner Base-Data Extraction & Cleansing-Automated Import to DA-Task Assignment-Marketing Campaigns

Increase Retentionof Service Customers-Data Extraction & Cleansing-Service Reminders-Follow-up Calls

Leverage LeadSources-Import to DA-Lists from OEM & Purchased

*All Actions are Compliant with National DNC Registry

Acquisition

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Ups Calls

Made

Contacts Appt.

Set

Appt.

Show

Appt.

Close

Appt. as a % of Sold

Total

Sold

Average Performance June

509 1,039 422 150 78 22 22% 131

78% 204% 41% 35% 52% 37%

AcquisitionDealer Advance, Proven Sales Results

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Gain customer and sales process insight:

DPS conducts brief and non-intrusive, internet or live telephone, interview of un-sold opportunities within (3 days) of their visit or inquiry.

Individual feedback is captured, and disseminated, via the DealerAdvance™ System, for review and additional follow-up.

We also collect objective and actionable information on the prospect’s buying status.

Acquisition

VOP – Voice of the Prospect

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BUYER STATUS:

•Active- (Still in market)Additional Follow-up required

•Purchased Elsewhere

•Inactive (No longer in market)

Acquisition


Status is up-dated daily in

your DealerAdvance™

System for additional dealership follow-up. Hot Prospects are identified and an urgent communication is immediately generated.

Status is up-dated daily in

your DealerAdvance™

System for additional dealership follow-up. Hot Prospects are identified and an urgent communication is immediately generated.

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BUYER STATUS:



“In-brand”

Turn lost sales opportunities into service revenue!

Acquisition


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BUYER STATUS:



“In-brand”

Competitive Brand

Turns today’s lost sales into tomorrow’s opportunities !

•Inactive (No longer in market)

Acquisition


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TOTAL UPS 500UNIT SALES 100LOST OPPORTUNITIES 400PURCHASED ELSEWHERE % 90%

PROSPECT YIELD 360"IN-BRAND" ELSEWHERE % 70%

PROSPECT YIELD 252CAPTURE RATE 10%

CUSTOMER YIELD 25

TOTAL UPS 500UNIT SALES 100LOST OPPORTUNITIES 400PURCHASED ELSEWHERE % 90%

PROSPECT YIELD 360"IN-BRAND" ELSEWHERE % 70%

PROSPECT YIELD 252CAPTURE RATE 10%

CUSTOMER YIELD 25

25% Improvement in New Service Customers

RESULTS!

Acquisition

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Generates market demand with compelling offers on an

unlimited selection of creative designs

Acquisition

Acquisition Direct Mail

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Components

•DealerAdvance™ Opportunity Management System

•Voice-of-the-Prospect follow-up Program

•Acquisition Mail generate demand and drive traffic

Each leverages:•Actionable data,•Timely & Relevant communications and;•Quality interactive Processes•Demonstrates the quantified value the customer derives from the relationship

To deliver RESULTS!

Acquisition

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RET

ENTI

ON

RET

ENTI

ON

PRO

CES

S

PRO

CES

SOW

NER

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IP

EXPER

IEN

CECONSUMER

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Retention

Managing the Ownership Experience

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We identify your most valued customers and recognize their loyalty while you reap the rewards!

Retention

Unlock your assets!

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RetentionMarketing Logic

3K, 3.75K• New purchase

customer is contacted via VOC. Service is introduced and 1st appointment is reinforced

• First Reminder 15 days prior to due date

• 2nd reminder sent 15 days prior to next scheduled service

• Non responders are called within 10 days of no-show

• Final reminder sent at next interval: strong language.

• VOC Defector finds out why they aren’t coming back

• VOC: Satisfaction, channel of choice, reinforce mcp.com, et al

• Declined services captures customers that said “no”

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5K, 7.5K• New purchase



• Overdue reminder sent 30 days from previous due date

• No responders are called within 10 days of no-show





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15K• New purchase



• Interim Communication maintains contact during long periods of inactivity

• No responders are called within 10 days of no-show





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How it worksMaintenance reminders are automatically generated utilizing the customer’s “channel-of-choice” when services are due.

Retention

Owner Rewards Integration with Communications

Loyalty program status is displayed on all communications

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Non-Responders are contacted via the telephone by highly trained professionals.

This additional contact increases response rates by as much as 30%!

Retention

VOC – Voice of the Customer

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Utilizing the customer’s Channel-of-Choice responding customers generating a transaction (customer pay and/or warranty) are contacted and a Voice-of-the-Customer survey is conducted within 72 hrs. of their visit. (Retention II or stand alone solution)

Results are up-dated daily and available on line 24 X 7.

Retention

VOC – Voice of the Customer

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RET

ENTI

ON

RET

ENTI

ON

PRO

CES

S

PRO

CES

SOW

NER

SH

IP

EXPER

IEN

CECONSUMER

SHOPSHOP

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Retention

Managing the Ownership Experience

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Introduced during the sales process as a key differentiator.

While they shop…

After they Buy…

When it’s time to repurchase…

Provides the ability to demonstrate the quantified value the customer derives from the relationship.

It provides a unique competitive advantage.

Owner Rewards

How does it provide advantage?

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Activation process

Owner Rewards

• Every qualified buyer receives a Welcome Kit & Member Card, describing the program’s features, advantages & benefits

• The Kit instructs them to activate their benefits on-line

• New buyers are contacted through the VOC process within 3 days of delivery. Reinforcing activation.

• If no contact made – Welcome Letter sent with activation instructions

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Owner RewardsWelcome kit

Welcome Letter Loyalty Card

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Owner RewardsPromo kit

•Benefits brochure

•Addendum sticker

•Member Sticker

•Promo Banner & P.O.P.’s

Promotional Kit

•Next Service Due Static Cling

•Post Card Announcement

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Web Portals

• Relevant actionable information is collected

• Channel of choice identified

• Complete consumer resource

• Rewards balance available

Consumer

Dealer

Owner Rewards

http://graffchevrolet.mycarpoints.com/Logon_GraffChev.aspx

http://www.mycarpoints.com/dealerpoints/pointlogon.aspx

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• Printed/e-Communications – Current customers: Mailed Reminders, e-mail, post cards, and MCP.com

• Voice-of-the-Customer – Active customers: Sales follow-up, Service Satisfaction., Non-responders, & Defector

Each leverages:•Actionable data,•Timely & Relevant communications•Quality interactive Processes and;•The ability to demonstrate the derived value

To deliver RESULTS!

• Owner Rewards – Points, rewards website, integration with communications, welcome kit, and promo kit

Retention & Owner Rewards

Components

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CONSUMER

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Renewal

Managing the Renewal process

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Mine your customer base for

“In-Market” sales opportunities!

Leverage your assets!

•In market timing

•Warranty expiration

•Year of vehicle

•Old age/high mileage vehicles

•Visiting owners in repurchase period

•Much more

Renewal

Managing the Renewal process - Sales

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Increase R.O. values by improving your service mix!

Leverage your assets!

The Customer Reactivation Campaign successfully targets

Inactive, higher mileage vehicle owners with model specific

incentives.

Renewal

Managing the Renewal process

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RenewalMarketing Logic

• Oldest defectors are segmented (oldest 1/12th). VOC calls are made

• Channel of choice, status of vehicle & owner, and reasons for defection are collected

• “We miss you” letters sent remaining defectors over 3 months

• Quarterly mailers sent after that.

• Responders enter the Retention module

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Implement DPS’ PerfectCircle CLM…

…it will help you create a competitive advantage.

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Next StepsNext Steps<list next steps here>

Documents

Customer LifeCycle Management SM Tap into YOUR hidden potential with