CRM

Significance of CRM
Customers tell eight friends about a satisfying experience and
20 friends for a negative experience.
It is easier to influence existing customers to buy 10% more
than increase the customer base by 10%.
Eighty percent of successful new product and service ideas
come from existing customers.
Repeat customers cost one- fifth less than new customers and
can substantially increase profits.
(Source - American Society of Quality and Arthur Anderson Consulting Inc., 1977)
Advantages of CRM
Perpetual stream of revenue:
Positive referral creation:
Provides premium:
Helps in customer retention:
Lower cost of sale:
Helps in understanding of consumer behaviour:
Provides opportunity to cross-sell and up-sell:
Reduces marketing time and effort:
Channel cost rationalization:
Enables business process re- engineering:
Constraints of CRM
1.Unorganised and unstructured
2. CRM at individual discretion
3. Restricted to smaller group of customers
4. Confined to specific trade
5. No technological support
Types of CRM
Proactive versus Reactive CRM
Operational , Collaborative and Analytical CRM
 Operational CRM
A process by which company maximises the process of
gathering and understanding customer information from all
touch points.
Face to face touch points Database driven touch Mass Media
points

Sales/Service/Channel/Events/ Telephones/ Emails/ Advertising/ PR/Website

Stores/Promotions SMS/ATMs’
Collaborative CRM
A specific functionality that enables a two way dialog
between a company and its customers through a
variety of channels to facilitate and improve the
quality of customer interactions.(Dyche, 2002)
Analytical CRM
It involves understanding the customer activities that occurred in
the front office.(Dyche, 2002)
It involves analyzing the large amounts of cross- functional data
using data mining and other methods and feeding the result
back to operational CRM