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Customer Relationship
Management

Customer OVERVIEW • Customer Relationship

Management (CRM)
Relationship CRM
ØA company-wide business strategy
Management Strategic, Operational,
Analytical, designed to optimize profitability
Collaborative, Model-
model CRM
and customer satisfaction by
focusing on highly defined and
precise customer groups.

14–3

1 2 3

Benefits CRM 14.1

• Focus of CRM: • Economic benefits of maintaining relationships with

current customers:
ØCustomers rather than products
ØChanges in processes, systems,
and culture
ØAll channels and media involved
in the marketing effort, from the
Internet to field sales.
– Acquisition costs for new customers are high.
– Long-time customers spend more money than new
ones.
– Happy customers refer their friends and colleagues.
– Order-processing costs are lower for established
customers.
– Current customers are willing to pay more for products.

14–4 14–5

4 5 6

14.2
Outstanding CRM Managing Customer
Satisfaction
• Transactional Relationship
• Key Elements of Customer Satisfaction:
Ø An association between a business and a customer that relates to a purchase
or a business deal Ø Providing the most basic benefits of the product or service.
• Beliefs about Exceptional Customer Service Ø Offering general support services, such as customer
Ø Small firms possess greater potential for providing superior customer service assistance.
than do large firms. Ø Setting up a system to counteract customers’ bad
• Beliefs about Exceptional Customer Service experiences.
Ø Superior service creates customer satisfaction. Ø Delivering extraordinary services that excel in meeting
Ø Customer satisfaction results in a positive transactional relationship. customers’ preferences and make the product and/or service
Ø Positive relationships lead to increased firm profits. seem customized.

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14.3 Customer Service Strategies

Extraordinary Service: Personal
Attention Managing Customer Satisfaction
Ways to Provide
Extraordinary Service • Customer Experience Management (CEM)
ØAn approach that recognizes that with every
interaction, customers learn something about
Do business
on first-name
Address
problems
a firm that will affect their desire to do
basis Find ways to promptly business there in the future.
help

Provide
ØHaving a positive experience
Keep in
touch
custom with a business becomes part
service
of the firm’s value equation.
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u se as p erm itted in a licen se d istrib u ted 14–10
w ith a cer tain p ro d u ct o r ser vice o r
o th erw ise o n a p assw o rd -p ro tected 14–11
w e b site fo r classro o m u se .

10 11 12

14.4 Consumer Options for Dealing with

Product or Service Dissatisfaction Using Technology to Support 14.5 Highly Recommended CRM Software Packages
for Small Businesses

Customer Relationship
Management
Blog, Wikis, Online
Social Networking Communities

CRM Software
Web 2.0
Customer Information Hosted Call
Management Systems Centers

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14.6 Simplified Model of Consumer Behavior

Creating a CRM Using a CRM (Customers as Decision Makers)

Database Database
Categories for Building a Customer Database Creating An 1. Capture relevant customer
data on interactions across
Effective CRM
important touch points
Personal information Lifestyle and
Program
psychographic data
2. Analyze those data to better
Demographics understand customers
Profile of past
Internet information responses
3. Use those insights to improve
Complaints relationships
Transaction data
with customers

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Understanding
Sociological Influences
on Customers
Culture Social Classes

Consumers

Opinion Leaders Reference Groups

20

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