Customer Relationship

Management

McGraw-Hill/Irwin Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved.
 CRM

 Custmer relationship management:

The overall process of building and
maintaining customer relationships by
delivering superior customer value and
satisfaction
 Todays companies are going beyond designing
strategies to Attract , Retainand create
transaction with them.
 The new view of MARKETING is the science
and art of
Finding, Retaining, and growing profitable
customer..........................................
16-2
 CRM

Customer Lifetime Value:

The value of entire stream of purchases the
customer would make over a life time of
patronage.(investment)

Customer life time value: To keep customers

coming back, Stew Leonard’s has created the
Rule no 1....... The customer is always right.
Rule no 2........ If the customer is ever wrong, read
rule no 1................

16-3
Attracting, Retaining, and Growing
Customers

The key to building customer relationships is to

create superior customer value and satisfaction
Relationship Building Blocks: Customer value &
satisfaction.
Customer Value:
The difference between total customer value and
customer cost............

Exp ............... FedEx

16-4
 Customer Satisfaction

 The extent to which a product’s

perceived performance matches a
buyer’s expectations.

 Customer Loyalty and Retention.

Highly satisfied customers produce several
benefits for the company. Satisfies customer
are less price sensitive . They talk favorably to
others.

16-5
 Even a slight drop from complete satisfaction
can create an enormous drop in loyalty. For
example, one study showed that completely
satisfied customer are nearly 42 percent more
likely to be loyal than merely satisfied
customers. Another study, AT&T showed that
70 percent of customers who say they are
satisfied with a product or service are still
willing to switch to a competitor: customer
who are highly satisfied are much loyal, Xerox
found that its totally satisfied customer are six
times more likly to purchase Xerox products
than are its satisfied customers............

16-6
Customer Relationship Levels and
Tools

 Companies can build customer relationships at

many levels, depending on the nature of the
target market.
Exp............ P&G
Company can build Valu and Satisfaction by the
following ways....

 Financial Benifits:
Marketing programs that reward customer who
buy frequently ............. Airlines offer............
Hotels..........

16-7
Customer Relationship Levels
and Tools
 Social Benifits
Swiss Watch maker, Swatch: The Club members
get additional chance to buy limited-edition
Swatch specials. They also received Swatch
World Journal.
The Manager of Swatch’s club says, “ our
members are like walking billboard” “They love,
live, and breath our product. They are
ambassador for Swatch”

16-8
Customer Relationship Levels and
Tools

 Structural Ties
Supply customers with special equipment or
computer linkages that help them manage their
orders.............

 FedEx.......Customer can use the Web site to

arrange shipments and track the status of their
FedEx packages any where in the world......

16-9