Pavia CRM Strategy Paper

Customer Relationship Management Strategy

Pavia Gallery ~Espresso Bar @ Cafe

955 Herring Cove Road, Herring Cove

(902) 407-4008

4 / 1 6 / 2 0 1 3

By:

John McIntosh, Brandon Macneil, Ashley Goss & Andre Sakr

Customer Relationship Management Strategy Pavia Gallery ~ Espresso Bar & CaféApril 16, 2013

Table of ContentsExecutive Summary.....................................................................................................................................2

Situation Analysis........................................................................................................................................3

Vision Statement.........................................................................................................................................4

Definitions...................................................................................................................................................4

Most valuable Customers (MVP).............................................................................................................4

Most growable Customers (MGC)...........................................................................................................4

Below Zero’s (BZ’s)..................................................................................................................................5

Pavia Persona’s (Customer profiles)............................................................................................................5

Most Valuable Customer (MVC) - “Favias”..............................................................................................5

Most Growable Customer (MGC) – “Drippers”........................................................................................5

Below Zero (BZ) - “Loafers”.....................................................................................................................6

Goals............................................................................................................................................................7

Strategies.....................................................................................................................................................8

Most Valuable Customer (MVC) “Favias” Strategy..................................................................................8

Most Growable Customer (MGC) “Dripper” Strategy..............................................................................9

Below Zero (BZ) “Loafers” strategy........................................................................................................10

Management of 1 to 1...............................................................................................................................11

Technology................................................................................................................................................11

Timelines...................................................................................................................................................13

Achievability..............................................................................................................................................14

Appendices................................................................................................................................................15

Public Relations action helps stop Cyber bully in his tracks...................................................................15

Yelp Review...........................................................................................................................................16

Bibliography...............................................................................................................................................17

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Executive Summary

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Situation Analysis

Currently, Pavia does not employ any kind of CRM strategy that involves technology of any kind. Pavia’s

customer groups like Most Valuable Customer’s (MVC’s), Most Growable Customers (MGC’s) and Below

Zero’s (BZ’s) are identified for the most part by the major players within the organization – the founding

partners: Mr. Christopher Webb and Ms. Victoria Foulger.

Pavia’s most profitable customers are now being identified using human facial recognition

recognizance (memory). Pavia staff relies on their own memories as a strategy to provide a 1 to 1

interactions with their customers. Unfortunately, this means that if one staff member usually deals with

a particular MVC, then the same MVC may not receive the same high level of quality service that Pavia

wants to ensure that they get – for every visit. For example, a particular customer usually deals with

Victoria in the mornings when coming in for her Latté, and Victoria knows this customer always

purchases a blueberry muffin. Victoria is currently unavailable, being out in the stockroom at the

moment. Chris doesn’t know what this customer’s wants and needs are, so he doesn’t ring in the

blueberry muffin during the transaction, and the customer doesn’t bother making it an issue and walks

out the door without it. Pavia just lost a sale of a baked good, but more importantly, they lost the

recognition and special treatment that this regular customer usually receives from Victoria.

Pavia staff is made up of several key players that deal with customers on a regular basis. Both

Chris and Victoria (founding partners) are always around but not always dealing with customers. There

are three trained baristas on staff that deal with customers for the most part – one is full time (Gloria),

and the other two are part time (Miguel and Courtney). There is not a high turnover rate of baristas at

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Pavia, but when it happens, Pavia finds itself in a situation where they may be losing customers and or

profit because their customer’s special wants and needs have to be “re-learned”

Vision Statement

Pavia is an art gallery combined with a European espresso bar and café with an Italian theme,

and pleasantly crafted ambience. We strive to both gain and maintain relationships with all of

our customers while learning more details about their wants and needs. While we want to make

all of our customer’s experiences the best they can be at Pavia, we also want to ensure that our

most treasured customers receive the treatment they deserve and more.

Definitions

Most valuable Customers (MVP)

A regular customer (4-6 visits per week) that not only purchases specialty coffee beverages &

dolce, but also indulges in lunch or supper at least once a week or more at Pavia. Pavia MVC’s

also kept a supply of their favorite drip blend of Pavia coffee beans at home and purchases the

beans every couple of weeks. They often bring their date / significant other or friends with

them into the café, effectively introducing them to the brand. Several pieces of art were also

sold to clients that networked through MVC’s.

Most growable Customers (MGC)

A regular customer (4-6 visits per week) that purchases drip coffee only for the most part &

rarely purchases specialty coffee’s or dolce. The customer has not eaten lunch or supper at

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Pavia, or at least it has happened that seldom that Pavia employee’s cannot remember serving

them from the food menu.

Below Zero’s (BZ’s)

A nuisance customer of Pavia’s that ends up costing more to maintain than they profit the

company is known to Pavia as the “Yelper”. This customer rarely visits Pavia, perhaps once per

week if that. They show up just before or during Pavia’s busiest times of the day (lunch or

supper time) and purchase only a coffee, and never any dolce or other food menu items and

then proceed to utilize valuable seating within the café for long periods of time that could be

otherwise be utilized by Pavia MVC’s or MGC’s.

Pavia Persona’s (Customer profiles)

Most Valuable Customer (MVC) - “Favias”

Pavia’s most valuable customer has a face and personality we not only recognize, but we enjoy

interacting with them every day, almost like a true friend. We usually know them by name, and they

also know us (Pavia staff) by our names as well. While we usually remember their wants and needs, we

do sometimes find ourselves asking those questions from time to time to remind ourselves of their

preferences. They are usually a pleasure to deal with – seldom do we ever find ourselves asking if they

would like to purchase some dolce with their order, they usually aren’t shy in letting us know what they

want right away. We refer to these customers as “Favias” because they are our “favourite”, and

subsequently the most valuable of all of our Pavia customers.

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Most Growable Customer (MGC) – “Drippers”

Pavia’s most growable customer has a face we recognize allot, but we don’t usually interact with them

very much so we tend able to remember a whole lot about their wants and needs. Usually we have to

ask these customers (about 60% of the time) what they take in their coffee, every time they purchase it,

even on a daily basis. We generally try to upsell to most customers, but this customer’s standard

reaction to our dolce upsell is usually “No thanks”. We refer to these customers as “drippers” because

that’s pretty much all they purchase from us on any kind of regular basis. These are our most growable

customers because we see potential in building a relationship with them to the point that we can grow

the relationship into something more profitable. This customer’s personality is not as outgoing as our

MVC’s is – They seem to be waiting for us to make the first move on “taking the relationship further”.

Below Zero (BZ) - “Loafers”

Pavia’s worst customers, known as Below Zero’s – are usually a special breed indeed. If Pavia Staff

doesn’t recognize these “loafer” customers from past experiences where profit was lost because of

them, they are sure to recognize a loafer in the future. With their mac book air in hand, they

purchasing only a coffee and seat themselves at the best available table in the café (usually

during, or just before Pavia’s busiest times such as lunch or supper time). Pavia’s BZ will then

continue to sit at this table, the entire time, sipping their one purchased coffee whilst perusing

the internet, via Pavia’s free Wi-Fi connection on their laptop. MVC’s and MGC’s are seen

leaving Pavia with a specialty coffee, but without their usual dolce or lunch purchase because

there isn’t enough seating available for them.

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Goals

Clearly identify and tag our main customer types (MVC, MGC & BZ) into easily

recognizable Pavia “personas” that our staff can readily relate to using the newly

designed CRM database.

Differentiate our customers into sub-categorical groups from each other based on

clearly defining their wants and needs. IE: Diabetic, Gluten & other allergies Etc. in

order to encourage customer growth.

Clearly define a mutually comfortable method of interaction with our customer’s

that not only allows us to discover more about their specific wants and needs, but to

also allow us to build a more trusting relationship with them on a 1 to 1 level.

Recognize and reward our customer’s loyalty through the use of both an electronic

smartphone application and print card loyalty program.

Recognize our customer’s wants and needs to the point that we can begin to offer

them a more customized product that will better suit those wants and needs in the

hopes that a higher profit will be realized.

Pavia’s goals are not only obtainable, they are easily measureable. Post-implementation

strategy surveys will be deployed in both web and print form in order to measure the success of

these goals through customer feedback. Another method of measuring these goals will be by

simply analysing sales from the start of the strategy to six months into its implementation.

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These two methods of measurement will provide us with valuable insight into the effectiveness

of our strategy in the achievement of our goals.

Strategies

Most Valuable Customer (MVC) “Favias” Strategy

Understanding and differentiating the needs of its MVC’s is of the upmost importance for Pavia.

When MVC’s are identified and tagged within the new CRM database, this will provide Pavia

with a means of not only identifying them more easily, but a means to analyse them and to

even create customized products based on those needs. For example, through various

interactions it is learned that an MVC is allergic to Gluten. Other interactions with the same

customer may have also revealed preferences for sweets like chocolate chip cookies. Pavia will

be able to create a customized product (gluten-free cookies) for this particular customer that is

sure to result in increased loyalty and sales from them.

Emphasis will be put on the quality of service that MVC’s receive from Pavia staff. While

Pavia strives to serve everyone with a high service quality level – Pavia will go above and

beyond for its MVC’s. Pavia staff will smile a little more, provide a warm welcoming comment

to these customers, ensure that their preferences are ALWAYS remembered in detail is key.

During this customized higher level of interaction, Pavia staff will be carefully watching and

listening to these MVC’s and recording their findings in the database as soon as they get a

chance afterwards. Pavia staff will be careful to cite any details of the interaction that may be

used to pick up and begin the next interaction, such as a MVC stating that they are thinking of

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purchasing a new Volkswagen – what a great way to start the conversation in the next day or

two with this customer than to ask how they gotten on with their automobile purchase. Pavia

will also be recognizing MVC’s by rewarding them with products that may actually “fit” through

analyzing the database, such as a bag of free coffee beans of their favourite blend.

Most Growable Customer (MGC) “Dripper” Strategy

By further analysing its customer database and through carefully crafted interactions, Pavia

may learn that several of their “Dripper” or “MGC” customers are simply not purchasing any

dolce (sweets) with their beverages because they are either allergic, or unable to consume

them for reasons like they are a diabetic (sugar content). Again, the importance of identifying

customer’s wants and needs is realized through these important actions.

By “tagging” several of these MGC’s into sub-categorical groups, Pavia will be able to

launch new upselling opportunities by targeting these groups with the kinds of customized

products that are sure to appeal to them. Take an example where several customers are

diabetic and after starting to make these customers aware that Pavia has “created” these

customized sugar free products just for them – they now find these items in high demand, even

selling in bulk to these diabetic customers who can sometimes have a hard time finding diabetic

friendly sweets period, let alone at THEIR local coffee shop. These are some ways that Pavia

can appeal to these MGV's, and more than likely be able to nurture and grow them into MVC’s

because of the consideration they took to identify their special needs, and cater to them.

Those MGC’s may very well now become extremely loyal customers to Pavia.

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Below Zero (BZ) “Loafers” strategy

A carefully devised and executed plan needs to be in place for dealing with BZ's. Depending on

the customer, there may be a way to move them into either a MGC or even a MVC however

usually this is not the case. Either way, care has to be taken when dealing with them as to not

create a "DC" (disgruntled customer) who might then decide to cyber-attack the company or

worse. (See Appendices – Public relations move helps stop Cyber bully in his tracks) (CBC News

- Nova Scotia, 2013) The actual “cyber-attack” in question can also be viewed in the appendices

under “Yelp Review”.

Pavia’s strategy to deal with Below Zeros will be two fold. First, Pavia will be introducing

a digital loyalty card in the form of an App. All customers will be provided with incentives like

free dolce or sandwiches, coffee beans etc. The idea being to attempt to convert the BZ’s into

breakeven ones at the very least if not even MGC’s. The second tactic, although sneaky in

nature – is designed to encourage the “loafers” to move on to another café. If and when the

loafer is in the café, the Wi-Fi connection will mysteriously stop working – hopefully giving them

the hint to move on. Another strategy could involve the use of time limiting no-loitering signs

such as those employed by Tim Horton’s – but we would rather not see that have to happen.

At all times, Pavia must realize that anything they say and do could possibly be used

against them in the form of a Cyber bully attack so words and actions need to be chosen

carefully.

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Management of 1 to 1

Technology

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Timelines

Pavia CRM Strategy TimelineTask July August September October November December January

2014

Design & Implement new CRM database & smartphone APP

Install database computer system & smartphone App QR-Code scanners

Train Pavia Staff on "Capsule CRM database" & AppFull use of Database & smartphone App with trained staff Ongoing ->Implementation of print loyalty cards for non techie customers

Evaluate Effectivenes

s

Administer CRM plan effectiveness evaluation survey

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Achievability

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Appendices

Public Relations action helps stop Cyber bully in his tracks

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(CBC News - Nova Scotia, 2013)

Yelp Review

(S., 2012)

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BibliographyCBC News - Nova Scotia. (2013, April 1). Small cafe claims it's the victim of cyberbullying. Retrieved April

1, 2013, from CBC News - Nova Scotia: http://www.cbc.ca/news/canada/nova-scotia/story/2013/04/01/ns-pavia-cyber-bully.html

S., P. (2012, 11 24). Pavia Gallery - Espresso Bar & Cafe. Retrieved 04 1, 2013, from Yelp: http://www.yelp.ca/biz/pavia-gallery-espresso-bar-and-cafe-herring-cove-3#query:Pavia%20Espresso%20Bar%20%26%20Caf%C3%A9

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Pavia CRM Strategy Paper

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