and maintaining profitable customer relationships by delivering superior customer value and satisfaction. CUSTOMER PERCEIVED VALUE
Customer’s evaluation of the difference between all the benefits and all the costs of a marketing offer relative to those of competing offers. CUSTOMER PERCEIVED VALUE
Is FedEx’s service worth the higher price? FedEx thinks so.
It promises reliability, speed, and peace of mind. FedEx ads say “Need to get it there or else? Don’t worry. There’s a FedEx for that.” FEDEX COMMITMENT FOR CUSTOMERS Fed Ex was the first company in the US history who raised huge revenues
Customer satisfactory ratings are
remarkable.(94% highly satisfied)
6 FEDEX SERVICE QUALITY Wrong day delivery Right day, late delivery
Pick up not made
Lost package
Customer misinformed
Employee performance failure Damaged packages
7 CUSTOMER SATISFACTION
Dependent on the product’s perceived performance relative to a buyer’s expectations. CUSTOMER LOYALTY & RETENTION Customer Lifetime Value The entire stream of purchases that the customer would make over a lifetime of patronage. CRM (Customer Relationship Management) is a multifaceted strategy that help companies understand, anticipate and manage customer needs
CRM major thrust involves in customer
segmentation and offering appropriate differentiated services All customers deserve at least a core level of service, but more strategically important customers deserve an enhanced level of service.
CRM is more than technology it is a
process, it is intended to be a repeatable process. CRM comprises the acquisition and deployment of knowledge about customers to enable a company to sell more of their product or service more efficiently. CRM is the process of acquiring, retaining and growing profitable customers.
However CRM is a strategy that must be
tailored to each market segment
If not done it leads to customer
Dissatisfaction/customer attrition DEFINATION 2
Customer Relationship Management (CRM)
is a business philosophy, not just a technology - understanding your customers' needs enables you to build better relationships and increase sales. DEFINATION 3
Customer Relationship Management (CRM)
is a term that defines a company's comprehensive effort to attract and retain customers through an integration of information, people, policies, processes, and systems strategies. It requires a cross- functional process since no single business unit can execute CRM on its own. It is a top- down driven process. DEFINATION 4
CRM, consists of determining who your best
customers are, and getting and keeping their trust and loyalty, all of which increases sales and maximizes profits. 17 18 19 CHAPTER 1: CONCEPT AND CONTEXT OF CRM
Introduction
Buyer/Seller relationship over the ages:
Barter Age
Customized Product Age
Mass Production Age
Customization Age
20 1970 – 1980 CUSTOMER
Passive customers
Buyer – Determined by the companies
No proper market feedback
One way communication with the target
1980 – 1990 CUSTOMER Customer as Individual
Help customers – Help desk, call centers,
Redesign the products DBMS
Market Feed back systems
1990’S CUSTOMER
Customer is person - Cultivate and maintain
relationship
Identify solutions, Reconfigure products
Products based on deep understanding of
customers
Relationship marketing two way communication
BEYOND 2000 Customers co-create value
Collaborators & Co- developers
Customers are part of emergent
social and cultural systems
Market acceptance
Multilevel communication SCOPE OF CRM
CRM aims to look at all aspects that will enable
an organization’s capability to manage and nurture its 1:1 relationship with its consumers.
True customer intimacy requires a deep
understanding of the context in which products and services are used in the course of customers’ day-to-day lives.
25 CRM-DEFINED
Gartner – A business strategy designed to
optimize profitability, revenue and customer satisfaction.
PWC Consulting – CRM is a business strategy
that aims to understand/appreciate, manage and personalize the needs of an organization’s current and potential customers.
26 UNDERSTANDING THE VARIOUS DEFINITIONS
Common theme in most of the definitions:
(a) CRM is about strategy—
Strategic CRM Designing a CRM strategy Companies motivation to adopt CRM strategies
27 THE COG WHEEL PROCESS
28 (b) CRM – the ‘customer’ thread –
The evolution and transformation of customers
Relationship Hierarchy concept
Loyalty Pyramid concept
29 Loyalty Pyramid
30 THE NINE TRUTHS OF RELATIONSHIP MARKETING
1. Customers are no longer loyal.
2. Customers do not really want a relationship but companies do. 3. Customers want information. 4. Customers not only want to be thanked for their patronage, they expect it. 5. Customers control the selling process.
31 6. The Lifetime Value of a customer is not relevant. 7. Do not overcomplicate the program. 8. Keep reporting simple and focused on the customer. 9. WHAT IF? Ask it often. Experiment every chance you get and don’t call it testing.
32 The Benefits
CRM has many potential benefits.
It helps companies to identify their best customers. Enrich and individualize customer contact. Manage marketing campaigns . Reduce customer response times, and serve wide geographical regions. CRM will help your business if you view it as a set of tools that let you to do more for, and get more from, your customers.
CRM can: Develop better communication channels
Collect vital data, like customer details and order
histories
Create detailed profiles such as customer preferences
Deliver instant, company-wide access to customer
histories
Identify new selling opportunities
•Prevents over spending on low value customers •Removes technology impediments. •Optimizes its distribution network. •Inoculates customers from competition. •Improves market return on investment. COMPANIES TRANSFORMATION FROM ‘MAKE AND SELL’ TO ‘SENSE AND RESPOND’ PHILOSOPHY THEN NOW Maximizing market share & Maximizing customers value is revenue was the objective the primary objective
* Quality standards were * Quality standards are
determined internally determined by the customer
* Product and service were * Products are developed in
separate entities service for customization
* Only marketing people were * Everyone in the company is
concerned with the customer concerned with the customer
* Marketing management was an * Marketing is managed by cross- 36
independent function functional teams THE OLD THE NEW
Products were developed to enter new Products are developed to meet
markets customer needs
Brands were built to have Brands are positioned to offer
differentiated associations distinctive value
Communications were used to convey Communications are used to create
brand associations expectations of value
Delivery systems were used to make Delivery is used to reinforce the value purchases easier proposition
Relationships were less important Relationships are built to offer
