CHAPTER 3

CUSTOMER RELATIONSHIP MANAGEMENT

A STRATEGIC PERSPECTIVE 1

CHAPTER 3

Chapter 3

Building Customer Relationship

KEY STEPS IN RELATIONSHIP BUILDING PROCESS

CHAPTER 3

Differentiate

Customise

Identify

Interact

LADDER OF LOYALTY
CHAPTER 3

BONDING FOR CUSTOMER RELATIONSHIP

CHAPTER 3

Financial Bonds- Volume and Frequency rewards, Bundle and Cross-selling, and Stable pricing, Social Bonds- Personal relationships, continuous relationships and Social Bonds among customers, Customisation Bonds- Customer intimacy, Mass Customisation and Anticipation/ Innovation, Structural Bonds- Integrated information systems, Joint Investments, and Shared Processes and Equipment.
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Customer Defection Curve

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Why Customers Defect?

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Types of defectors
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1. 2. 3. 4. 5. 6.

Price defectors

Product defectors
Service defectors Market defectors Technology defectors Organisational defectors
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Customer Retention Program steps

CHAPTER 3

Measure customer retention Interview former customers

Analyze complaint and service data

Identify switching barriers

CRM FRAMEWORK
CHAPTER 3

In competitive markets even satisfied customers switch or defect to competitive offers. Since loyal customers are more profitable for any organisation, there is a need to identify better predictors of loyalty. Indicators of relationship strength like trust, satisfaction and commitment are better predictors of loyalty and by including these parameters in customer satisfaction surveys, managers can modify service delivery with a focus on customer loyalty. (Mookerjee, A. and Shainesh, G., 2000)

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Psychological Steps Across Relationship Stages

CHAPTER 3

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