Customer Relationship Management

CUSTOMER RELATIONSHIP MANAGEMENT
INTRODUCTION
In the recent years, it has been observed that for any business giant to have maximum market share requires something more than technology, innovation, capital. It has been seen that the company first tries to be market favorite and then heads on to be the market leader. The key which takes the share price of the company at top most level is the customer. Once beautifully quoted by Mahatma Gandhi customer is the most important person for a business. He is not an interruption to our work but the purpose of it. He is not an outsider; he is a part of it. We are not doing him a favour; he is doing us a favour by giving us an opportunity to serve him.
Many organizations have realized that to sustain in the market they have to do more than selling of their product. For this the only mantra is to provide customized and personalized services to customers, which in management is also known as praticising customer relationship management. This concept is tremendously gaining importance in corporate circles and is emerging as the business theme for the 21st century.
To understand this, few key concepts should be taken into consideration. They are stated as under:
Who is a Customer?
A customer refers to individuals or households that purchase goods and services generated within the economy. The word historically derives from "custom," meaning "habit"; a customer was someone who frequented a particular shop, who made it a habit to purchase goods from there and with whom the shopkeeper had to maintain a relationship to keep his or her "custom," meaning expected purchases in the future.
There is a difference between customer and a consumer. A consumer is always a customer but a customer is not necessarily a consumer. A customer can be a medium between a goods manufacturer and/or a service provider and the end user E.g. A person who purchases a chocolate from a retail shop is a consumer who is also a customer but the same retail shop owner when purchases it from the wholesaler or manufacturer is just a customer and not a consumer because he never consumes the chocolate.
Customer who was considered to be the king of market is now regarded as the emperor of market. Since all the organizations have the same technology and more or less the same price offering, it is only the customers loyalty which can take their business sky high.
What is a Relationship?
A relationship is a specific connection between objects, entities or concepts. This bond can exist between an individual and an organization or between two individuals or between two organizations. These relationships are categorized as social relationships, causal relationships and mathematical or theoretical relationships which are between components of a modeled system. Herein, presence of both the parties is a must. Both cannot survive without each other.
What is Management?
Management comprises directing and controlling a group of one or more people or entities for the purpose of coordinating and harmonizing them towards accomplishing a goal. Managing of human resources, financial resources, technological and natural resources are the core activities of a business.
Now, in case of customer relationship management it means managing of the customers of the company. In todays competitive environment, customer is not only the king but the emperor of the market. Two things a service provider has to keep in mind while performing business activities: Customers time is precious. Apart from him, there are several other service providers to serve
his customer.
Because of this, the company cannot afford to loose a single customer, may it be regular or occasional. Retaining the customer is an essential part of business today. That is why a healthy relationship should be established with the customers of the company. In order to serve the customers, the company should understand all their needs and desires, so that the customer buys the companys product over and over again.
The personnel who manages these relationships with the customers is called customer relationship manager and the process carried out by the company is called customer relationship management. Like any other manager, the Customer relationship Manager also has certain set of responsibilities and goals to be achieved for his organization. For him, the duties include right from building relationships with the customers to maintaining and enhancing relationships with the valued customers.
Converting a stranger to a potential buyer and then to a loyal customer who does not change his loyalty even if there are cost benefits, this task is undertaken by the customer relationship manager. Essentially he reshapes business process to meet customer expectations, empower employees to best serve the customer and determine how to most efficiently and effectively deliver on those needs.
APPROACHES TO MARKETING
There are two approaches to marketing for any marketer. They include Traditional marketing Relationship marketing
1.
Traditional Marketing
This is also called as transaction marketing. Herein, the focus is
entirely on making a sale. Only product features are focused. Very little attention is given to customer service. Because of this the commitment of customer is low, there is moderate customer contact. This kind of marketing approach solely aims at customer satisfaction by showing the customer only functional benefits of the product.
2.
Relationship Marketing
This kind of approach is practiced in modern times. Herein, the
focus is much more than selling. It aims at making a customer loyal. This is done by emphasizing on high customer service. Primary concern is quality. It does not emphasize on selling more and making more customers. It stresses on the fact that a customer should b a lifetime client for the company. Customer retention is the sole aim of relationship marketing.
Definition of CUSTOMER RELATIONSHIP MANAGEMENT

There are various definitions of customer relationship management stated by many experts over the years. Berry defined CRM as relationship marketing is attracting, maintaining and enhancing customer relationships. Shani and Chalsani also in 1992 defined relationship marketing (CRM) as an integrated effort to maintain and build up a network with the individual consumers and to continuously strengthen the network for mutual benefits of both the sides, through interactive, individualized and value added contacts over a long period of time. Peppers and Rogers in 1993 gave a recent technology based approach in which they have said, CRM is to focus on an individual or one-to-one relationship with the customers that integrate database knowledge with long term customer retention and the growth strategy. From the above definitions we can arrive at one suitable definition, which is customer relationship management is a comprehensive strategy and the process of acquiring, retaining and partnering with selective customers to create superior value for the company and the customer.
UNDERSTANDING CUSTOMER RELATIONSHIP MANAGEMENT
In marketing literature, the term customer relationship management and relationship marketing are used interchangeably. CRM starts with in dept knowledge of customers, their habits, desires and their needs by analyzing their cognitive, effective behavior and attributes. CRM applies this knowledge to develop and design marketing strategies, to cultivate long lasting mutually beneficial interaction and relationship with the customer. Every organization should remember that you are not in a business to delight customers. You are in a business to be delighted by them. CRM is a business strategy that can help organizations drive new growth, attain operational excellence, and gain competitive agility. The core theme of all CRM and relationship marketing perspectives is its focus on co-operative and collaborative relationships between the firm and its customers. CRM is based on the premise that, by having a better understanding of the customers needs and desires we can keep them longer and sell more to them. CRM isnt new; every company needs to do CRM -one way or another. No matter what the business, every company has to make its product known to the market and find customers who are willing to buy its products in order to stay in business. Every company must discover customer needs, market and sell the products that meet these needs, provide some sort of customer service and make sure the revenue it generates covers the cost of business plus any profit margin it tries to achieve.
Once a business organization selects its target market, it has to collect customer database and develop customer preference. The relationship cannot be a one sided approach. It should involve the other side equally with value sharing proposition. Hence, CRM is development of lasting strategic alliances with customers on a value sharing basis. This implies future orientation and a winwin proposition between the seller and the customer.
Relationship marketing is a philosophy of doing business on strategic orientation that focuses on keeping and improving current interactions with the parties concerned rather than acquiring new parties. The philosophy has an underlying assumption that the customers prefer to have an ongoing relationship with an organization than to switch continually in search for values. It is undoubtedly a slow and a continuous approach of an organization to become market favourite and increase its customer base.
Hence, CRM cycle can be described as follows:
Acquiring customers Keeping customers Growing your customers Gaining customer insight Interacting with your customers across all touch points Building lasting relationships with your customers Delivering value to your customers Achieving a sustainable competitive advantage Growing your business
These parameters are integrated together to achieve one goal for organization i.e.:- to establish and manage long term mutually beneficial relationships with current and prospective customers. Infact successful companies build their business around their customers. They strive to become fully customer driven, delivering superior customer value and consistently providing exceptional customer service. Tom Peters stated listening to customers must become everyones business. With most competitors moving ever faster, the race will go to those who listen and respond intently.
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CUSTOMERS DEFINE YOUR BUSINESS
No business can exist without customers. Without customers there is no reason to make any investment in employees, products, office equipments or technology. Thats why you need to look at your business from the customers perspective. No matter how good a product is or how efficiently an organization operates, without customers there is neither growth nor profitability. Customers make their purchasing decision and they bid the price up or driving it down depending on the value they perceive from a product or service. Its the customer who decides which way and when he or she wants to interact with the company and how he or she wants to buy a product-online, over the phone, in the store, or through any other channel. Its the customers perception of everything a company does that creates an image of its brand and eventually determines its success or failure as a business. Hence, you need to develop strategies that enable your organization to continuously improve the ability to win, know and keep your customers.
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Growth strategies International (GSI) performed a statistical analysis of customer satisfaction data encompassing the findings of over 20,000 customer surveys conducted in 40 countries by Infoquest.
A totally satisfied customer contributes 2.6 times as much revenue to the
company.
A totally satisfied customer contributes 17 times as much revenue as a
somewhat dissatisfied customer.
The average company loses 20% of its customers every year and the
number is increasing every year.
It costs up to 10 times to acquire a new customer as it does to keep an
existing one.
A 5% deduction in customer defections can result 25% to 100% increase in
profits depending on the industry.
A totally dissatisfied customer decreases revenue at a rate equal to 1.8 times
what a totally satisfied customer contributes to a business.
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HISTORY OF CRM
Looking back at the snapshot history of marketing, we can see the following clear developments and progression over the last four decades: 1960 The era of Mass Marketing when Gibbs SR toothpaste began the first
marketing of its kin with its black and white TV campaign. 1970 Saw the beginning of segmentation, direct mail campaigns and early
tele-marketing. at it. 1990 - Relationship Marketing. The explosion of telemarketing and 1980 Where Niche Marketing made millionaires of those who were best
callcentres all set up to develop relationship with customers. The recognition of the true value of retention and the use of lifetime value as a business case. In addition to this, a number of key marketing concepts can also be used to see where CRM has developed from: Satisfaction needs customer orientation. The organization needs to be arranged so that all functions
contribute. Profit must be the consequence of delighting customers.
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EVOLUTION OF CRM
In recent years however, several factors have contributed to the rapid development and evolution of CRM. These include: -
1. The growing de-intermediation process in many industries due to the advent of sophisticated computer and telecommunication technologies that allow producers to directly interact with end-customers. For example, in many industries such as airlines, banks insurance, software or household appliances and even consumables, the de-intermediation process is fast changing the nature of marketing and consequently making relationship marketing more popular. Databases and direct marketing tools give them the means to individualize their marketing efforts.
2. Advances in information technology, networking and manufacturing technology have helped companies to quickly match competition. As a result product quality and cost are no longer significant competitive advantages. 3. The growth in service economy. Since services are typically produced and delivered at the same institution, it minimizes the role of the middlemen.
4. Another force driving the adoption of CRM has been the total quality movement. When companies embraced TQM it became necessary to involve customers and suppliers in implementing the program at all levels of the value chain. This needed close working relationships with the customers. Thus several companies such as Motorola, IBM, General Motors, Xerox, Ford, Toyota, etc formed partnering relations with suppliers and customers to practice TQM.
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5. Customer expectations are changing almost on a daily basis. Newly Empowered customers who choose how to communicate with the companies across various available channels. Also nowadays consumers expect a high degree of personalization.
6. Emerging real time, interactive channels including e-mail, ATMs and call centre that must be synchronized with customers non-electronic activities. The speed of business change, requiring flexibility and rapid adoption to technologies. 7. In the current era of hyper competition, marketers are forced to be more concerned with customer retention and customer loyalty.
8. As several researches have found out retaining customers is less expensive and more sustainable competitive advantage than acquiring new ones.
9. On the supply side it pays more to develop closer relationships with a few suppliers than to develop more vendors.
10. In addition several marketers are concerned with keeping customers for life than making one time sale. There is a greater opportunity for up selling and cross selling. In a recent study in 1999 it was found that relational intensity increased in hospitals facing a high degree of competitive intensity
11. The globalization of world marketplace makes it necessary to have global account management for the customers.
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Following things comes to our mind when we hear of CRM
1. 2. 3. 4. 5.
Technology. Call centre. Complaint resolution. Customer data. Making customer happy.
KEY CRM PRINCIPLES

Differentiate Customers All customers are not equal; recognize and reward best customers disproportionately. Understanding each customer becomes particularly important. And the same customers reaction to a cellular company operator may be quite different as compared to a car dealer. Besides for the same product or the service not all customers can be treated alike and CRM needs to differentiate between a high value customer and a low value customer. What CRM needs to understand while differentiating customers is Sensitivities, Tastes, Preferences and Personalities Lifestyle and age Culture Background and education Physical and psychological characteristics
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Differentiating Offerings Low value customer requiring high value customer offerings Low value customer with potential to become high value in near future High value customer requiring high value service High value customer requiring low value service
Keeping existing customers
Grading customers from very satisfied to very disappoint should help the organization in improving its customer satisfaction levels and scores. As the satisfaction level for each customer improves so shall the customer retention with the organization. Maximizing life time value
Exploit up-selling and cross-selling potential. By identifying life stage and life event trigger points by customer, marketers can maximize share of purchase potential. Thus the single adults shall require a new car stereo and as he grows into a married couple his needs grow into appliances. Increase Loyalty Loyal customers are more profitable. Any company will like its mindshare status to improve from being a suspect to being an advocate. Company has to invest in terms of its product and service offerings to its customers. It has to innovate and meet the very needs of its clients/customers so that they
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remain as advocates on the loyalty curve. Referral sales invariably low cost high margin sales
OBJECTIVES OF CRM
1. CRM aims at integrating all business strategies that places the customer at
the centre of a businesss consciousness.
2.
Aligning of organization towards customers.
3.
Integrating your customer touch points.
4.
Establishing and managing relationships with customers.
5.
Knowing and understanding your customers and potential customers Before framing and implementing CRM it is very important to
know what your customer expectations are. Be it a small organization or a business giant, every organization is bound to have a CRM strategy for itself. The only difference is their level of operation. A satisfied customer always acts as an unpaid salesman for the company. So, better the organization understands its customers expectations, the future results are to be expected positively.
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Following mentioned are some of the expectations of the customer when they carry out transaction with the organization.
1. 2. 3. 4. 5. 6. 7. 8. 9. 10.
Overall quality Handling queries Staff friendliness Treat as a valued customer Complaint handling Competence of staff Speed of service Ease of doing business Helpfulness of staff Kept informed From the above mentioned, it is observed that 7 out of 10
relate to EMOTIONS. So the customers remember:-
(a)
Interactions Specifically how human the company was In mathematical form, a customer remembers only 30%
(b)
about the product and its price and rest 70% is determined by treatment during interactions, which includes sales and marketing is 15%, repair/service takes 30%, installation is 10% and billing accounts for nearly 15%. (Source- bell labs scientists study of 3,00,000 customers)
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DO CUSTOMERS LOOK FOR RELATIONSHIP

The answer is YES. Customers do look for relationship with business people. They also gain some benefits through the relationship with the seller. The following are some of the benefits the customers gain:
RELIABILITY: - Customers want to build relations to find a reliable
source of supply and service.
TIME: - When customers find reliable seller they need not waste time
searching for various other sellers.
SEARCH: - The information search costs and energy cost gets minimized.
EXCHANGE: - A known seller accepts return of defective goods or
executes recovery in the case of service without any difficulty. SUPPORT: - Many a time customers seek sellers support in taking
purchase decisions. The advice of a known seller provides greater support to the customer.
IN ABSENTIA PURCHASE: - A continuous rapport with the seller
enables the customer to communicate his/ her likes, dislikes or preferences. He may manage to get the products at home, without personally going out for the service.
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CREDIT: - Customers make seek liberal credit without security from a
known seller. SOCIAL VALUE: - Consumers are social beings and they look for identity
and recognition in society. When sellers wish them at various social occasions, they feel very happy and delighted.
In the changing competitive scenario many business concerns satisfy the values listed above. The imbalance in value to the business and value to the customers due to relationships still exists. Companies which progress through valuesharing relationships are likely to achieve better results. The spread of information and the educational campaigns of many organizations have increased consumer expectations manifold.
It is not only the market share but the mind share and heart share that need to be captured. For this reason only, organizations should adopt relationship marketing with a strong process to achieve the above mentioned purpose.
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CRM FORMATION PROCESS
In the formation process, three important decision areas relate to defining the purpose (or objectives) of engaging in CRM, selecting parties (or customer partners) for appropriate CRM programs and developing programs (or relational activity schemes) for relationship engagement with the customer.
CRM PURPOSE
The overall purpose of CRM is to improve marketing productivity and enhance value for parties in involved in the relationship. By seeking and achieving operational goals, such as lower distribution costs, streamlining order processing and inventory management, reducing the burden of excessive customer acquisition cost, and through customer retention economics, firms could achieve greater marketing efficiencies. They can enhance marketing effectiveness by carefully selecting, customers for its various programs, individualizing and personalizing their market offerings to anticipate and serve the emerging needs of individual customer, building customer loyalty and commitment, partnering to enter new markets and develop new products, and redefining the competitive playing field for their company.
Thus, stating the objectives and defining the purpose of CRM in a company helps clarify the nature of CRM programs and activities that ought to be performed by the partners. Defining the purpose would also help in identifying suitable relationship partners who have necessary expectations and capabilities to
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fulfill mutual goals. It will further help in evaluating CRM performance by comparing results achieved against objectives. These objectives could be specified as financial goals, marketing goals, strategic goals, operational goals, and general goals. Customers are motivated to engage in relational behavior because of psychological and sociological benefits associated with reduction in choice decisions.
CRM PROGRAMS
A careful review of literature and observation of corporate practices suggest that there are three types of CRM programs: continuity marketing; one-to-one marketing; and, partnering programs. These take different forms depending on whether they are meant for end consumers, distributor consumers or business-to-business consumers.
(A) CONTINUITY MARKETING

Take the shape of membership and loyalty card programs where customers are often rewarded for their member and loyalty relationships with the marketers. The basic premise of continuity marketing programs is to retain customers and increase loyalty through long-term special services that has a potential to increase mutual value through learning about each other.
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(B) ONE-TO-ONE MARKETING

This relates to meeting and satisfying each customers need uniquely and individually. In the mass markets individualized information on customers is now possible at low costs due to the rapid development in the information technology and due to availability of scalable data warehouses and data mining products. By using online information and databases on individual customer interactions, marketers aim to fulfill the unique needs of each massmarket customer.
Information on individual customers is utilized to develop frequency marketing, interactive marketing, and after marketing programs in order to develop relationship with high-yielding customers. In the context of business-tobusiness markets, individual marketing has been in place of quite sometime. Known as Key Account Management Program, here marketers appoint customer teams to husband the company resources according to individual customer needs.
(C) PARTNERING PROGRAMS

The third type of CRM programs is partnering relationships between customer and marketers to serve end user needs. In the mass markets, two types of partnering programs are most common: co-branding and partnering.
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ORGANIZING FOR CRM

How do you know that your business requires CRM? It is very easy for a business to get caught in the latest customer trap when it is being driven by the information technology (IT) market. Every business does require CRM. The question is to what level. Many businesses are pushed by the current trend to change their business strategy, especially around CRM. There are basically three trends that affect a business. They are as follows:
CONSUMER The customer is an ever-changing image; to be really successful
with CRM you must recognize the customer trends that are affecting the business. If a business does not understand a customer profile and the changes that have occurred then it is not possible to provide true customer relationship management.
PRODUCTS It is the business providing the products that meet the
changing customer trends. Products need to be reviewed constantly perhaps enhanced or even removed. Supermarkets are a perfect profile to look at for viewing product trends, they constantly add and remove products and they constantly view customer buying profiles and set out the pattern of the store to meet the strongest buying trend.
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TECHNOLOGY Ensure that the business is ready to install the new
technologies, is the customer data up to it, or is it time to start again? Do you need to review every technology being used or just one area. Will it assist the business, is it going to grow with the business requirements or is the technology just another trend? Relationship management should not be an alternative to existing functions/technology; it could be a logical extension to enhance those in existence, though it could radically change some of the operational process. Does CRM really matter? Is your business and customer ready for it?
Whatever the business activity is, all companies have to ask themselves is CRM the real factor for their company to succeed. Some customers do not need longterm relationship with their suppliers; therefore only minimal information is required from that customer. That however is still a form of CRM. Other companies have high quality and high value customers that they need to know information about, they need to provide exceptional service, the pedigree of CRM.
Whatever the business is, if it has customer it has to ask, does customer relationship management matter? What does it mean to them in business terms? At what cost? What is the overall loss if not adhered to? CRM: Yes it does really matter the strategy needs to last, be constantly reviewed and can evolve over time.
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CRM GOVERNANCE PROCES

Greater the scope of CRM program and associated tasks, and the
more complex is the composition of the relationship management team; the more critical is the role specification decision for the partnering firms.
It is essential to establish intra-company communication particularly
among all concerned individuals and corporate functions that directly play a role in managing the relationship with a specific customer or customer group.
With mass-market customers frequent face-to-face interactions will
be uneconomical. Thus marketers should create common bonds through symbolic relationships, endorsements, affinity groups and the membership benefits or by creating online communities.
Involving customers in the planning process would ensure their
support in plan implementation and achievement of planned goals. All customers are not willing to participate in the planning process nor is it possible to involve all of them for relationship marketing programs for the mass markets.
Human resources decisions are also important in creating the right
organization climate for managing relationship marketing. Training employees to interact with customers, to work in teams, and manage
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relationship expectations are important. So is the issue of creating the right motivation through incentives and rewards.
CRM IMPEMENTATION ISSUES

One of the most interesting aspects of CRM development is the multitude of customer interfaces that a company has to manage in todays context. Until recently, a companys direct interface with the customers, if any was primarily through sales people or service agents. In todays environment most companies interface with their customers through a variety of channels including sales people, service personnel, call centers, Internet websites, marketing departments, fulfillment houses, market and business development agents, etc. For large customers it also includes cross-functional teams that may include personnel from various functional departments. While each of these units could operate independently, they still need to share information about individual customers and their interactions with the company on a real time basis.
For example, a customer who just placed an order on the Internet and subsequently calls the call centre for order verification expects the call centre staff to know the details of his or her order history. Similarly a customer approached by a sales person unaware that she has recently complained about dissatisfactory customer service, is not likely to be treated kindly by the customer. Therefore effective CRM requires a front-line information system that shares relevant customer information across all interface units. Relational databases, data warehousing and data mining tools are thus valuable for CRM systems and solution.
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The challenge is to develop and integrated CRM platform that collects relevant data input at each customer interface and simultaneously provides knowledge output about the strategy and tactics suitable to win customer loyalty and support. If a call centre personnel cannot identify or differentiate a high value customer and does not know what to up-sell or cross sell to him then it would be a tremendous loss of opportunity for the company. Although most CRM software solutions based on relational databases are helping share customer information, they still do not provide knowledge output to the front line personnel. CRM solutions platform needs to be based on interactive technology and processes. It should assist the company in developing and enhancing customer interactions and one-to-one marketing through the help of suitable intelligent agents that help develop front-line relationship with customers.
Such a system would identify appropriate data inputs at each customer interaction site and use analytical platforms to generate appropriate knowledge output for front-line staff during customer interactions. In addition, implementation tools to support interactive solutions for customer profitability analysis, customer segmentation, demand generation, account planning, opportunity management, contact management, integrated marketing communication, customer care strategies, customer problem solving, virtual team management of large global accounts, and measuring CRM performance would be the next level of solution sought by most enterprises.
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CUSTOMER SELECTIVITY
An important facet of CRM is customer selectivity. As several research studies have shown not all customers are equally profitable (Infact in some cases 80% of the sales come through 20% of the customers). The company must therefore be selective and tailor its program and marketing efforts by segmenting and selecting appropriate customers for individual marketing programs. In some cases, it could even lead to outsourcing of some customers so that a company better utilize its resources on those customers it can serve better and create mutual value.
However, the objective of a company is not to really prune its customer base but to identify appropriate customer programs and methods that would be profitable and create value for the firm and the customer
CUSTOMER LIFE CYCLE

Customer life cycle is a term used to describe the progression of steps a customer goes through when considering, purchasing, using, and maintaining loyalty to a product or service. Marketing analysts Jim Sterne and Matt Cutler have developed a matrix that breaks the customer life cycle into five distinct steps: reach, acquisition, conversion, retention, and loyalty.
In layman's terms, this means getting a potential customer's attention, teaching them what you have to offer, turning them into a paying
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customer, and then keeping them as a loyal customer whose satisfaction with the product or service urges other customers to join the cycle.
The customer life cycle is often depicted by an ellipse, representing the fact that customer retention truly is a cycle and the goal of effective CRM is to get the customer to move through the cycle again and again.
Following is the example of a particular customer who does business with the bank and remains loyal irrespective of the existing competition. Here, the customer life cycle does not break because the bank (organization) provides the customer with customized services and creates a win-win proposition for both the parties.
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CUSTOMER VALUE PROPOSITION.

In the field of marketing, a customer value proposition consists of the sum total of benefits a customer is promised to receive in return for the customer's associated payment (or other value transfer). In simple words: value proposition = what the customer gets for what the customer pays.
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5 STAGE CUSTOMER DEVELOPMENT CYCLE

1st step Awareness 2nd step Comparison 3rd step Transaction 4th step Reinforcement 5th step Advocacy
Now lets see these in detail. Awareness- This is the first stage. Here the customer gets information about the product from various sources. These includes from media, websites, medical representatives, references, magazines, newspapers etc.
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Comparison In this stage, the customer compares the new product with the product of competitor. By giving what the customer expects, benefits over competitors and credibility are the key to success at the comparison stage. Essentially, the more information you provide, the higher the likelihood you will make the sale. Transaction This stage is the beginning of the relationship. Price becomes a critical aspect for the customer. Unless you are giving products away for little or no profit, the transaction stage will only take place if you have played your cards right during the awareness and comparison stages. The transaction stage should be viewed as the beginning, not the end, of the relationship.
Reinforcement -The reinforcement stage is where you add value to your customers' purchases by showing them how to maximize the value and pleasure their purchases can provide. The reinforcement stage presents you with an opportunity to position yourself apart from your competition by thanking your customers for their purchase and paving the way for future purchases. It's where you begin the process of creating word-of-mouth ambassadors for your firm out of satisfied customers. Advocacy This is the final stage of customer development cycle. This is the stage where the customer becomes the companys promoter and gives recommendations to the aspirers of the product. It is considered to be the most effective form of advertising ever devised.
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SUCCESSFUL APPROACHES TO CRM

1. CUSTOMERS AS FRIENDS
In the service business, personal relationships and warmth are critical to success. A small automotive repair business in Mexico has blazed a new trail in service leadership by treating customers as friends. At servicious automatrices echegary (SAE), proprietor Alfredo Gomez impresses upon his employees, through personal example that customers must be treated as friends.
The following are the guiding principles for this stated concept:
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Do not make abnormal and unfair profits out of friends. SAE basis its
repair pricing on labour costs plus a 40% margin. As most of its customers are themselves automotive experts, there is no point in even trying to hoodwink them.
Do not make a margin on a friends cause. The discounts offered by
suppliers should be passed on to friends.
Do whatever is possible to help a friend. It may mean working
overnight or even on weekends. Remember, a friend in need is a friend indeed. Try to share your friends concerns. Learn more about his vehicle,
what is causing him trouble and keep him cautioned on what could cause a problem in the future. Take a ride with him in his vehicle to understand his concern fully.
Drive with him when he comes to collect the car, and ensure that he is
fully satisfied with the repair. Do not compromise on this.
Friends need to be in touch. Maintain a database and call your
friends when it is time for routine maintenance.
Friends should spend time together. So make a party of your job.
Allow your friends to participate in what you are doing and how you are doing it. Share with them whatever you do and plan to do. Encourage them to help you fix their cars and maintain them.
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Friends will give you a chance for they know that no one is perfect.
Even if you make a mistake they may be willing to overlook it. Just let them know that you are doing your best. Track your performance and keep improving so as to help your friends better. Get back to school! (To learn new advances and update on technology).
2.
CUSTOMERS AS GUESTS
Bruce Laval, a former senior vice president at Disney,
coined a term guestology to focus everyones attention on the importance of guest behaviors and expectations. Guestology turns traditional management thinking upside down. Instead of focusing on organizational design, managerial hierarchy and production system to maximize organizational efficiency, it forces the firm to look systematically at the customer experience from the guest point of view. Guestology involves systematically searching for the key factors that determine quality and value in the eye of guest, analyzing them, measuring their impact on the customer experience, testing various strategies that might improve the quality of experience and then providing a combination of factors or elements that attracts loyal customers. Only after developing this total guest orientation, can the rest of the organizational issues be addressed. The goal is to create and sustain
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an expertise that can respond to the customers needs and expectations and still make a profit. From their study of customer preferences, Disneys guestologists learnt that an important reason for customer satisfaction with its theme parks is its cleanliness. Disney therefore stresses on keeping the parks clean, and this has become one of its greatest assets. Keeping a theme park clean is a big job. So the Disney organization encourages its customers to help out by disposing of their own trash. In studying customer behaviour Disney learnt two things about trash disposal.
First, if caste member (Disney term for park employees) constantly pick up even the smallest bins of trash, park visitors would emulate, rather than litter. Caste members practice and respect cleanliness, and so they are role models for the customers. Second, if trash cans are convenient, easily seen and not very far apart, most people will throw their own trash into them. Disney locates its trash cans 25 to 27 paces apart. Understanding how customers respond to environmental cues and using that knowledge to help maintain a high standard of cleanliness is guestology in practicality.
ROLE OF CRM IN SCM
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In the context of SCM, where alliances and partnerships are keys to success, CRM plays an important role in building long-term relationships. Apart from the end-users, it involves internal employees, channel members and other external entities such as advertising agencies and consulting organizations. The success of relationships depends upon sharing of savings from the supply chain, which may be reinvested to further enhance its efficiency, and sustain the competitive advantage. The supply chain of tomorrow will look like a virtual organization, seamlessly integrated through sharing data and savings as well. The bonding between partners will be closely held by CRM practices.
CUSTOMER SATISFACTION
Customer satisfaction, a business term, is a measure of how products and services supplied by a company meet or surpass customer expectation. It is seen as a key performance indicator within business. In a competitive marketplace where businesses compete for customers, customer satisfaction is seen as a key differentiator and increasingly has become a key element of business strategy.
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Measuring Customer Satisfaction Organizations are increasingly interested in retaining existing customers while targeting non-customers; measuring customer
satisfaction provides an indication of how successful the organization is at providing products and/or services to the marketplace.
Customer satisfaction is an ambiguous and abstract concept and the actual manifestation of the state of satisfaction will vary from person to person and product/service to product/service. The state of satisfaction depends on
40
a number of both psychological and physical variables which correlate with satisfaction behaviors such as return and recommend rate. The level of satisfaction can also vary depending on other options the customer may have and other products against which the customer can compare the organization's products.
Because satisfaction is basically a psychological state, care should be taken in the effort of quantitative measurement, although a large quantity of research in this area has recently been developed. If expressed as a calculation, customer satisfaction might look something like this:
Your Performance Customer Satisfaction = Customer Expectations
Of course, customer satisfaction is influenced by a complex interplay of factors; it's hardly as simple as plugging numbers into a formula and calculating the result. Nevertheless, this calculation serves as a reminder that your customers' level of satisfaction can be affected by changes in either their expectations or your performance. That means you have to pay attention to both.
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And that's where things can get tricky, because how you perceive your performance may differ from how your customers perceive it. In fact, discrepancies between your perceptions and theirs would not be at all unusual; I routinely encounter such discrepancies when I interview a company's service staff as well as its customers. So, even if you're working yourself to the proverbial bone, if customers view you as unresponsive, then you are unresponsive in their eyes.
CUSTOMER RETENTION
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The trend in marketing towards building relationships with customers continues to grow and marketers have become increasingly interested in retaining customers over the long run. Marketing analysts have identified satisfaction as a key determinant in a consumers decision making, relating to keeping or dropping a given product or service relationship. According to Oliver, satisfaction is the consumers fulfillment response. It is a judgement that a product or service feature, or the product or service itself, provided a pleasurable level of consumption related fulfillment, including level of under or over fulfillment.
Companies do spend a lot of money through different media to attract new customers to the business. Attracting new customers requires substantial skills and effort. However, these skillful efforts will be of little use if the company suffers from high customer churn. Unless organizations pursue customer retention strategies, the problem cannot be solved. Every company needs to define and measure its retention rate. Each company must also distinguish the reasons for loosing customers and identify those causes that can be managed better. It is important to know how much loss the company makes when it looses customers.
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The key to customer retention is to offer continuous satisfaction to customers.
According to Philip Kotler, a highly satisfied customer
Stays loyal and longer. Buys more as the company introduces new products and upgrades
existing products. Talks favourably about the company and its products. Pays less attention to competing brands and advertising and is less
sensitive to price. Offers product or service ideas to the company. Costs less to serve than making new customers because transactions
take place in a routine manner.
It is necessary, therefore, to measure customer satisfaction regularly by surveying the customers to know whether they are highly satisfied, indifferent, dissatisfied or highly dissatisfied. Customer complaints are one of the important sources to track the level of customer satisfaction. Speedy recovery of complaints results in a stronger customer base. In the words of Albrecht and Zemke, between 54% and 70% of the customers who register a complaint will do business again with the organization if their complaint is resolved.
The figure goes up to a staggering 95% if the customer feels that the complaint was resolved quickly. Customers who had complained to an
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organization and have had their complaints satisfactorily resolved, usually tell an average of 5 people about the good treatment they receive.
The key to customer retention is relationship marketing. The service company should develop overtime the means of monitoring and evaluating the quality of relationship. There are 2 basic approaches that can be pursued to monitor the relationship: relationship survey and customer database.
Current customers should be surveyed in order to understand their value perception of the services, the quality and satisfaction. Customer database in relation to names addresses, phone numbers, demography, lifestyle, usage pattern, interest, opinions and so on forms the basic foundation for designing customer retention strategies.
Berry and Parshuraman have developed a framework which suggests that retention marketing can occur at three different levels. Each
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successive level of strategy results in ties that bind the customer a little closer to the firm. Following are the three levels of retention strategy:o Level one: Financial Bonds.
o Level two: Financial and Social Bonds. o Level three: Financial, Social and structural bonds.
1.
Financial bonds:At this level, customers are offered financial incentives either for
greater volume purchases or for continuation of relationship for a long time.
2.
Financial and social bonds:At this level, the firm intends to develop long-term relationships
with customers through social as well as financial bonds. The customers are identified by name and services are customized to fit individual needs. Marketers are looking for new ways to keep in touch with their customers by providing a personal touch and building informal relationships.
3.
Financial, social and structural bonds:-
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The strategy is to develop structural bonds along with financial and social bonds. Structural bonds are created by providing highly customized service to the clients. Specific customer needs are brought into organizational system to design new ways and to improve the offerings to the clients. In service business, sometimes there is a possibility of things going wrong. Under such circumstances, a recovery strategy needs to be designed for retaining customers. Effective recovery is essential to save and even build relationships. Therefore, service firms should track and anticipate recovery opportunities.
ECRM
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In simplest terms e-CRM provides companies with means to conduct interactive, personalized and relevant communications with customer across both electronic and traditional channels. It utilizes a complete view of the customer to make decisions about messaging, offers and channel delivery. It synchronizes communication across otherwise disjoint-customer facing systems. It adheres to permission based practices, respecting individuals preferences regarding how and whether they wish to communicate with you and it focuses on understanding how the economics of customer relationship affect the business.
While the definition is simple, achieving e-CRM itself is hard. For business organizations evolving to e-CRM requires process and organizational changes, a suite of integrated applications and a non- trivial technical architecture to support both the e-CRM process and the enterprise applications that automate the process.
WHY EMPLOYEE E-CRM

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Companies need to take firm initiatives on the E-CRM frontier to:
Optimize the value of interactive relationships. Enable the business to extend its personalized reach. Leverage customer information for more effective E-marketing and Focus the businesses on improving customer relationships and
E-business.
earning a large market share through consistent measurement and assessment.
THE SIX ES OF E-CRM The e in e-CRM not only stands for electronic but also stands for many other connotations viz:
1.
ELECTRONIC CHANNELS: New electronic channels such as the web and personalized e-
messaging have become the medium for fast, interactive and economic communication, challenging companies to keep pace with this increased velocity.
2.
ENTEPRISE:
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Through e-CRM a company gains the means to touch and shape a customers experience through sales, services and corner offices whose occupants need to understand and assess customer behaviour.
3.
EMPOWERMENT: E-CRM strategies must be structured to accommodate
consumers who now have the power to decide when and how to communicate with the company.
4.
ECONOMICS: An e-CRM strategy ideally should concentrate on customer
economics, which drives smart asset allocation decisions, directing efforts at individuals likely to provide the greatest return on customer communication initiatives.
5. EVALUATION: Understanding customer economics relies on the companies ability to attribute customer behaviour to market programs, evaluate customer interactions etc.
6.
EXTERNAL INFORMATION: The e-CRM should be able to gain and leverage information fro such sources as third party information networks and web page profile application.
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KEY E-CRM FEATURES

An e-CRM solution must possess certain key characteristics. It must be:
It must be driven by a data warehouse. Focused on consistent metrics to assess computer actions across channels. Built to accommodate new market dynamics that places the customer in
control. The loopholes in traditional CRM can be outlined. The CRM offering remains channel centric. Customer centric matrix is non consistent. Contemporary customer facing systems rarely interact with each other.
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10 WAYS TO AVOID CRM PITTFALLS

Despite the hype surrounding CRM, a number of reports suggest that the companys are dissatisfied with their CRM implementations. So is this the beginning of CRM or the end of CRM. Not so fast.
Decision makers must identify a clear corporate strategy before investing millions of dollars in the CRM project. The following list determines the top ten strategies for avoiding the common pitfalls in CRM. CRM software should mould to your companys best practices rather
1.
than forcing you to use the best practices of the CRM vendor.
2.
One should understand their own business processes before buying
CRM software. The CRM vendor should be able to help, identify and align these business processes with CRM technology.
3.
No CRM vendor excels in all areas. If your main goal is to build a
customer contact centre, do not pick a vendor that specializes in sales force automation or marketing automation.
4.
Given that any CRM vendor only provides 20% of the total CRM
solution, examine how easy or difficult it will be to integrate the vendors product into your companys legacy and new systems.
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5.
CRM needs are inheritantly fluid and will change as organizations
evolve. CRM solutions should be able to support these changes without massive professional service charges.
6.
Any CRM project that takes more than 90 days to implement runs
the risk of failure.
7.
Total cost of ownership over 5 years must include the whole CRM
strategy not just an individual peace of software. If you dont factor in these costs you will be unable to measure true ROI.
8.
One has to make sure that the CRM vendor is financially stable and
can weather an economic downturn.
9.
Beware of jumping on the latest technology bandwagon.
10. CRM technology is useless if the employees are unwilling or untrained to use the CRM project. Gain internal support by communicating the benefits of CRM technology to all parties and provide through product training.
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From the above diagram we can come to know weather the CRM strategy of the organization is a success or a failure. A fact which should be taken into consideration is that only 10% of the CRM is executed properly.
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CASE 1: MARUTI UDYOG LTD

I visited Maruti Udyog ltd. On 22nd September, 2007 at Delhi. I got an appointment of Mr.Shirish Mathur, a team leader in CRM department. Within one hour of conversation, I got the following answers to the questions asked:
1.
What is your understanding of CRM?
Ans: CRM, according to maruti consists of two approaches: (a) (b) Building customer loyalty Making profitable relationships For building customer loyalty the company arranges various field events like treasure hunts, customer meets and corporate events Treasure hunts: Treasure hunt is not a race against time i.e. it has nothing to do with the speed of the vehicle. It, rather judges the performance of the vehicle.
Six check points are given in terms of a riddle and the participant has to solve it and locate the check point at a particular city and get a stamp at the check point and then move to the next. The race is about who travels the shortest distance and in the speed limit of the city. An ideal speed is fixed by the company and the shortest distance is noted. Whoever comes nearest to these readings, wins.
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By this, we keep a check whether vehicles are performing up to the mark or not. Here the customers are also given the feedback form and are asked to fill it. At the end of the event the flaws are detected by analyzing these feedbacks and later remove. After removal of the flaws in the product and the service related to it, the customers are informed about the same. Hence, this process ensures customer loyalty.
Customer meets: Every Sunday in each dealership of maruti, customer meets are
held. The customers are asked to talk about the problems they are facing in the vehicles, during the sales process and in the after sales service. These flaws are deleted and the customers are informed about it. This again ensures customer loyalty is achieved.
Corporate events: Under corporate events, the people from the company and/or
dealership gets together and they arrange a sales promotion camp or a free check up camp in any particular company. By this maruti ensures that the employees of that particular company are benefited. In this way, they build customer loyalty.
(b) Making profitable relationships: This means making relationships with the customers to improve the quality of the product and the quality of service by involving the customers in decision making through discussions, holding customer meets and discussing their problems.
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Maruti builds the relationships with the following tools
Call center Magazine called gateway Loyalty card system Special schemes
2.
What are the tools and processes for practicing CRM?
Ans: The tools and the processes are customer meets, treasure hunts, corporate events. Call centers and others which are mentioned above.
3.
In what way is CRM practiced differently from other car manufacturers? Finance and insurance schemes: Herein, these schemes are more customer friendly than
Ans: There are two ways that are unique at maruti (a)
offered by other car manufacturers. Database marketing: Maruti has highest product range in case of cars. So they use database marketing. This means that they trace a person who already has purchased maruti car and the car is 3-4 years old. Then the company calls the customer and asks to upgrade the model. The company offers him the best deal so that he purchases maruti again.
(b)
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4.
As cars are no more a lifetime investment and companies give cars as perks
and opportunity to change it in 3-4 years. How do you ensure that they consider Maruti, in respect to CRM?
Ans:
Maruti calls its customers after 3-4 years of their purchase. We give them an
offer to upgrade the model of their car. They also come up with special schemes like if you deal with maruti then they sell the car on behalf of customer. They also provide special loyalty schemes and special bonus schemes under which they provide discount on bulk purchases.
5. Ans:
In what way are other departments contributing to CRM? Sales department helps to target right customer. Production
department helps in making the product according to the needs of the customer. HR department helps in organizing various training and development programs for the executives. Moreover, they also provide some incentives to them for handling the customers in proper manner. The Finance department comes up with the various financial schemes, special bonus schemes, etc for the benefit of the customer. Due to this, customer loyalty is ensured.
Marketing department has come up with a special loyalty card scheme, special corporate scheme, etc. all these efforts by different departments stated above help in managing relationships with the customer.
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6.
Your cars are exported to various countries. How do you manage
relationships with the customers there? Is there any difference in the tools, processes and tactics used? Ans: There is a separate team which handles all the matters related to
exports. The financial schemes, the bonus schemes are specially designed for the respective countries. Usually the tools and processes are the same. But some tools need to be changed as per the countries. For instance the tool of 24-hour call center is used in India but it cannot be used in rest of the countries. So, it has been changed.
7. Ans:
Does technology help in practicing CRM? The base of practicing CRM is the technology itself. All workshops are
connected with the main server and any complaint or problem given by the customers is registered in the server. So that it gets solved immediately. Call center mostly helps in tracking customers.
The problems of the customers are solved immediately with the help of call center. Moreover, if the car of the customer breaks down in the middle of the road then they can call the toll free number and get the help. Because of this, the customers stick with the company and customer loyalty is ensured.
8. now? Ans:
Are their any differences in the tools and processes of CRM earlier and Post 1999, when Maruti launched its toll free number, the speed of
operations was increased. Earlier the managers and executives used to target the customer and now the server itself identifies which customer to target for the upper model. Precisely, customer selectivity is done by the server itself.
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9. Are all employees trained towards CRM? Ans: Yes, definitely. All our employees are trained towards CRM as
managing relationships with the customers is an integral part of maruti. Also, with the increasing threat of competition, training to the employees for CRM has become inevitable.
Production department employees are specially trained to develop automobiles according to customers needs. Similarly, Sales department is trained to build one-to-one relationships with the customer.
Customer relationship managers in every dealership are trained to conduct customer needs every Sunday so that the problems faced by the customer in the product and related service can be identified and solved immediately.
10. Ans:
How is CRM helping you in retaining and increasing the market share? Continuous market analysis is done in order to take care of customers.
Maruti has excellent after sales service. This ensures that the customers come back to maruti again. All complaints and queries of customers are solved immediately. The sales executives are specially trained to build relationships with customers. This helps in building one-to-one relationship with the customer. Monthly training programs are conducted to train executives specifically for teaching how to build personalized relationships and give customized services.
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CASE 2 ICICI BANK LTD.

The second company I visited was ICICI Bank Ltd. On 7th September, 2007. Here, I visited Ms.Anjali Tolani who is deputy customer relationship manager at the call center of ICICI Bank at Andheri, Mumbai. Within an hour of interaction, I got the following answers to the questions asked:
1.
ANS: CRM, according to ICICI consists of following approaches: (a) (b) (c) (d) Getting personalized information on customers. What is the value of the relationship? Customized offerings to the customers Converting a prospective customer into a true customer.
Now, we shall see each approach in detail
(a)
Getting personalized information on customers. First, the bank collects all the information about the
customers for processing. ICICI bank has mainly 4 service offerings viz: loan account, saving account, current account and fixed deposits. Moreover, the bank has many customers in each category. So, they collect the data on one server and thus the company gets the personalized information on each customer by asking them to fill the information in customer application form.
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(b)
What is the value of the relationship? After the collection of the personalized information on
every customer, the department checks out the value of the relationship with each and every customer. Later, they decide how to approach the customer for knowing what his needs and wants are? After this is done, the company offers him the customized product.
(c)
Customized offerings to the customer.
The step which comes after deciding the value of the customer is that the company offers the person the customized product. Moreover, they also practice a concept called cross-selling over here. Cross-selling refers to offering another product from the service offering of the bank to the customer which he has not gone for. Example: If a customer has a saving account with the bank then they offer him a loan account.
(c)
Converting a prospective customer into a true customer. The last approach of CRM according to ICICI bank Ltd is
that they try to convert the prospective customer into a true customer. Right from the moment the inquiry comes, they follow-up the customer and then make him to come to the bank occasionally and then regularly.
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2.
What are the tools and the processes for delivering CRM?
ANS: The tools and the processes are as follows(a) (b) (c) (d) (e) Customer application form Centralized software where the whole data is collected Wide range of offering Cross-selling and Feedback forms
(a)
Customer application forms:Bank collects all the data from customer application form and gets
the personalized information to know which product to offer to which customer. This process helps in collecting the data and knowing what the customer wants.
(b)
Centralized software where the whole data is collected:The data collected through customer application forms is available at
one server and can be accessed anytime, anywhere. So, this helps in the further process of customized offerings and cross-selling.
(c)
Wide range of offering:63
After collecting the data from the customer, team decides what product to offer to which customer. Incase the bank recognizes you as a valuable customer then it offers a more customized service.
(d)
Cross-selling:It refers to offering another product from the service offering of the
bank to the customer which he has not gone for. Example: if a customer has savings account with the bank then they offer him a loan account. This is called cross-selling. This depends on the value of the customer to the bank. Cross-selling is not offered to every customer. It depends on how loyal the customer is to the bank. The more business he gives us, the more are his chances of being special services offered.
(e)
Feedback forms:The bank distributes feedback forms at all its branches. The customer
feedbacks on the service, technology used, employee behavior and promptness in solving customers problems, are taken and they are analyzed.
3. In what way is CRM of ICICI different from other banks?

64
ANS:
Most banks have their own databases but because of the huge
technological investments done by ICICI the databases in all the branches are integrated, which means they can be accessed from anywhere and at anytime. ICICI Bank has tied up with Terradata Company for making their software and is the only bank doing this.
The difference can be known through matching tool parameter. This refers to, on the server of ICICI sum standards are set in terms of value of the customer and whenever the customer reaches the set standard, the server automatically informs the department to offer him another product.
4.
How is CRM helping you in retaining and increasing the market share?
ANS:
CRM helps to know the needs and wants of the customer. So, on the
basis of this company can decide which product to offer to which customer.
Moreover, under CRM, we have identified that cross-selling is the best weapon. It enhances the relationship value with the customer. This satisfies the customer and that is the reason why the customer keeps on coming again and again to the company. This helps in retaining the market share.
Now, the satisfied customers help in the word-of-mouth promotion of the bank, which eventually increases our market share.
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5.
Does technology helps in practicing CRM?
ANS:
Yes definitely. The whole base for practicing CRM is technology. It
helps in collecting the data, processing the data and then according to the available information offering different products to the customer through emails, call centre, pop ups during the transaction in the ATM.
EMPOWERMENT AND CRM

In serving the customer with full dedication, it is very important for employees to be in right frame of mind. And this will be possible only when the employees are given freedom at work to do things as there way keeping in mind the organizational goals. For any customer, it is the front line personnel who embody the organization. So, employees are the walking billboards of the organization. Hence while delivering services to the customers and ensuring them that their perceived expectations and given services are equal, empowering them is very essential. This helps in delivery of efficient CRM.
Employee Empowerment and CRM

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The Case of Hewlett-Packard India

Relationship between Employee Satisfaction, Customer Satisfaction & Market Share Initiatives for Employee satisfaction A demotivated, unenthusiastic and unhappy employee will never care for the customers. Also organizations willing to spend money when they are doing well should spend on employees more rather than less when things get bad. An employee satisfaction survey should be carried out on a regular basis.
Hewlett Packard (HP) Case
HP sells its products through its channels. Whenever the customer purchases a product, and there is an issue to be resolved, the point of contact is the front line team. It handles the usage-related, the application related and the real product related issues. The backend team handles the upgradation issues. The partners provide the hardware support. The sales and services are provided by DPSPs and the ASPs only. Typically in a month, the total number of customer calls logged in at HP is 21,000 out of which 4600 are through web support, 1270 e-mails and 15,000 telephone calls. They use automated call distribution software, which also enables to track the particular history of the customer. The service providers are assessed continuously. It is a challenge to motivate engineers who are the employees of the service providers and are not HP employees. The engineers/service providers performance is monitored on: Turnaround Time
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Number of parts requested per call (Multiple Part consumption) Closing the call Customer satisfaction Repair rate Effective handling of customer escalations
HP has allocated points for each of these parameters for partner performance measurement. In case the partner performance falls below the desired level of points, then there would be deduction in the reimbursements of that reseller. However if he exceeds the given point scale then he qualifies for additional reimbursements which are offered as rewards.
HP contacts all customers, who are not happy with the service, and through the partners it is attempted that certain steps are taken so that the customer is happy. The training program for the partner is also regularly revived. There is also a Reward 1000 plus program where there are points awarded. There are points for various aspects such as training, quiz bulletin, customer feedback, customer service, re-repair rate. The top contributors among the resellers are identified and are sent for training or entertainment apart from monetary incentives. So at HP, there is synchronization of the employee satisfaction and customer satisfaction process to ensure a higher market share.
CONCLUSION
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CRM is emerging as the central theme of corporate strategy. It is no more an option to accept customer oriented philosophy for business. Essentially, customer relationship assumes greater significance since customer participation is vital in the production process and customer is the evaluator of service quality. It is also evident that handling customer relationship is not only the responsibility of marketing department or sales department, rather it is the responsibility of all the people working right from lower level to management level.
Approach towards customer relationship management should be an integrated one and continuous. This helps a business to gain customer loyalty at faster pace and have an edge over other competitors. Philosophies like friend approach and guest approach are of immense help for proper implementation of CRM.
Customer Relationship Management is not a mere tool for improving the relationships whenever a dip in the reputation of a company is noticed. Rather, it is a method of securing long-term commitments with the customers by providing the right product with the right quality. Essentially, CRM plans relationship on the basis of win-win proposition between the seller and the buyer. The scope of CRM is, therefore very vast and its reach is mind-boggling. What remains to be seen is that, will CRM take a different shape and come face- to-face with us or is CRM the final stage in the evolution of relationships.s
QUESTIONNAIRE
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1. Ans:-
__________________________________________________________________ __________________________________________________________________ __________________________________________________________________
2. Ans:-
What are the tools and processes for implementing CRM?
__________________________________________________________________ __________________________________________________________________
3. Ans:-
In what way is CRM of your organization different from others?
_______________________________________________________________ _______________________________________________________________ ______________________________________
4.
How is CRM helping you in retaining your customers and maintaining market share?
Ans:_______________________________________________________________ _______________________________________________________________ _______________________________________________________________
5.
Does technology helps in practicing CRM?
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Ans:_______________________________________________________________ _______________________________________________________________
6. Ans:-
Are all employees trained towards CRM?
_______________________________________________________________ _______________________________________________________________
7. Ans:-
How are other employees contributing towards CRM?
_______________________________________________________________ _______________________________________________________________
8. Ans:-
How is relation with over seas customers handled by your organization?
_______________________________________________________________ _______________________________________________________________ _______________________________________________________________
BIBLIOGRAPHY
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www.crmassist.com www.crmguru.com www.crmfoundation.com www.crmindia.org www.crmsearch.com www.crmcommunity.com www.CRM-forum.com
http://www.marketingsource.com/articles/view/3553
http://www.internetretailer.com/internet/marketing-conference/35899-growingimportance-crm.html
http://www.pr-inside.com/amc-integration-study-can-help-customersr348913.html http://www.nkarten.com/mce.html http://www.destinationcrm.com/articles/default.asp?ArticleID=3544
http://en.wikipedia.org/wiki/Customer
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http://www.businesslink.gov.uk/bdotg/action/detail? type=RESOURCES&itemId=1075422939
http://www.williecrawford.com/loyalty.html
http://searchcrm.techtarget.com/sDefinition/0,,sid11_gci757452,00.html
Philip KOTLER - Marketing Management Services Marketing - Parshuraman and Zeithmal
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CUSTOMER RELATIONSHIP MANAGEMENT

CUSTOMER RELATIONSHIP MANAGEMENT

CUSTOMER RELATIONSHIP MANAGEMENT

CUSTOMER RELATIONSHIP MANAGEMENT

CUSTOMER RELATIONSHIP MANAGEMENT

Definition of CUSTOMER RELATIONSHIP MANAGEMENT

CUSTOMER RELATIONSHIP MANAGEMENT

UNDERSTANDING CUSTOMER RELATIONSHIP MANAGEMENT

CUSTOMER RELATIONSHIP MANAGEMENT

CUSTOMER RELATIONSHIP MANAGEMENT

Hence, CRM cycle can be described as follows:

CUSTOMER RELATIONSHIP MANAGEMENT

CUSTOMER RELATIONSHIP MANAGEMENT

CUSTOMERS DEFINE YOUR BUSINESS

CUSTOMER RELATIONSHIP MANAGEMENT

A totally satisfied customer contributes 2.6 times as much revenue to the

A totally satisfied customer contributes 17 times as much revenue as a

somewhat dissatisfied customer.

number is increasing every year.

It costs up to 10 times to acquire a new customer as it does to keep an

A 5% deduction in customer defections can result 25% to 100% increase in

profits depending on the industry.

A totally dissatisfied customer decreases revenue at a rate equal to 1.8 times

what a totally satisfied customer contributes to a business.

CUSTOMER RELATIONSHIP MANAGEMENT

contribute. Profit must be the consequence of delighting customers.

CUSTOMER RELATIONSHIP MANAGEMENT

CUSTOMER RELATIONSHIP MANAGEMENT

CUSTOMER RELATIONSHIP MANAGEMENT

Following things comes to our mind when we hear of CRM

KEY CRM PRINCIPLES

CUSTOMER RELATIONSHIP MANAGEMENT

Keeping existing customers

CUSTOMER RELATIONSHIP MANAGEMENT

the centre of a businesss consciousness.

Aligning of organization towards customers.

Integrating your customer touch points.

Establishing and managing relationships with customers.

CUSTOMER RELATIONSHIP MANAGEMENT

relate to EMOTIONS. So the customers remember:-

CUSTOMER RELATIONSHIP MANAGEMENT

DO CUSTOMERS LOOK FOR RELATIONSHIP

RELIABILITY: - Customers want to build relations to find a reliable

source of supply and service.

searching for various other sellers.

EXCHANGE: - A known seller accepts return of defective goods or

IN ABSENTIA PURCHASE: - A continuous rapport with the seller

CUSTOMER RELATIONSHIP MANAGEMENT

CREDIT: - Customers make seek liberal credit without security from a

CUSTOMER RELATIONSHIP MANAGEMENT

CRM FORMATION PROCESS

CUSTOMER RELATIONSHIP MANAGEMENT

(A) CONTINUITY MARKETING

CUSTOMER RELATIONSHIP MANAGEMENT

(B) ONE-TO-ONE MARKETING

(C) PARTNERING PROGRAMS

CUSTOMER RELATIONSHIP MANAGEMENT

ORGANIZING FOR CRM

CONSUMER The customer is an ever-changing image; to be really successful

PRODUCTS It is the business providing the products that meet the

CUSTOMER RELATIONSHIP MANAGEMENT