Customer relationship management

CUSTOMER RELATIONSHIP MANAGEMENT

SUBMITTED BY: SACHIN KUMAR

DEFINITION

Customer relationshipmanagement is a model

for managing a company’s

interactions with current

and future customers. It

involves using technologyto organize, automate, and

synchronize sales, market

ng, customer service,

and technical support.

FUNCTIONAL AREA

CRM is concerned with the creation, development and enhancement of individualised customer relationships with carefully targeted customers and customer groups resulting in maximizing their total customer life-time value

CRM STRATEGIES- PRIORITIES

Acquire the right customer.

Craft the right value proposition.

Institute the best processes.

Motivate employees.

Learn to retain customers.

#1 - ACQUIRING THE RIGHT CUSTOMER

Account selection demands a clear understanding of:

1. Seller’s resources2. Customer’s needs3. Cost of serving various groups of customers4. Potential profit opportunities5. How customers define value and how to

meet those expectations

WHAT DO CUSTOMERS VALUE? Some demand low price Some demand customer service Some demand quick delivery

The question is: “Can the seller deliver it profitably?”

Many sellers try to meet all their customer’s needs, and may do so, but fail to do it profitably.

#2 – CRAFTING THE RIGHT VALUE PROPOSITION A value proposition

encompasses the products, services, ideas and solutions that a business marketer presents to the prospect/customer that is designed to solve the customers’ problems.

They can be generic or customized.

#3 - INSTITUTE BEST PRACTICES The sales force plays a key role in

establishing and growing a customer from a transactional account to a collaborative partnership.

They can do this by aligning and deploying technical and service support units to match with their customers’ units.

Technical groups can consist of research, logistics and customer service units.

Through careful management and screening, transactional accounts can progress to partnerships.

BEST PRACTICES FOLLOW-UP

In addition to using best practices, successful organizations (like IBM) employ follow-up techniques such as:

1. Assigning a client representative to take ownership of the relationship.

2. Assigning a Project Owner who completes the project or solves project problems.

3. Developing an in-process feedback and measurement system.

#5 - RETAINING CUSTOMERS

Retain customers by:

Providing superior value (more than expected) to ensure high satisfaction.

Nurturing trust. Developing mutual commitment. If possible, helping customers grow their

business.

HOW TO PURSUE GROWTH FROM EXISTING CUSTOMERS

Identify and cultivate customers that offer the most growth potential by:

1.Estimating current percent “share of wallet”2.Pursuing opportunities to increase share3.Projecting and enhancing customer profitability

EXPENDITURE ON CRMCompany 2012

Revenue2012

MarketShare (%)

2011 Revenue

2011-2012Growth

(%)salesforce.com

2,525.6 14.0 2,004.6 26.0

SAP 2,327.1 12.9 2,325.1 0.1

Oracle 2,015.2 11.1 1,870.0 7.8

Microsoft 1,135.3 6.3 900.9 26.0

IBM 649.1 3.6 465.6 39.4

Others 9,437.7 52.1 8,513.7 10.7

Total 18,090.0 100.0 16,079.9 12.5

CRM Software Spending by Vendor, Total Software Revenue Worldwide, 2012 (Millions of Dollars)Source: Gartner (April 2013)

CRM IN RURAL AREA

it is worth mentioning for rural marketing that “sentiments of customers are more important than economical utility of the products.” this serves as the guiding principle for seller of rural market. Customer relationship management can increase through following factors.

Packaging Local language and local celebrity Distribution customisation Packaging customisation

FACTORS INCREASING CRM IN RURAL AREA

Packaging : as packaging is important communication tool for rural market, companies must use prominent logo symbols and logo colors to ensure that illiterate consumer able to recognize the product. By creating a bond with customer through package, companies are able to establish a relationship that encourages repeat purchases.

FACTORS CONTINUED

Local language and local celebrity:

the models would wear the clothes properly and would use local language to increase the relationship between product and rural customer. This actually shows that products are affordable and can be easily available for them

FACTORS CONTINUED

Packaging customizationTwo of the most importantelement of package designed

forrural india include size andvisual communication. That’swhy sachet market is

introducedin rural area which make theproduct affordable to Indianrural customer.

FACTORS CONTINUED

Distribution customization:

a variety of innovation have been takes place in customizing the distribution for rural market. For transportation of goods the regular store keeper hire auto rickshaws, bullock carts and even boats in south india

FACTORS CONTINUED

Leveraging rural marketing :

Retailing is final phase of distribution channel. A study on buying behaviour of rural customers indicate that the rural retailer influence 35% of purchase decision. So it critically influence the rural market area and rural india

TYPES OF CRM

Marketing CRM systems for

marketing track and measure campaigns over multiple channels, such as email, search, social media, telephone and direct mail. These systems track clicks, responses, leads and deals.

TYPES

Customer service and support

CRM systems can be used to create, assign and manage requests made by customers, such as call center software which helps direct customers to agents. CRM software can also be used to identify and reward loyal customers over a period of time.

TYPES

Appointments CRM systems can

automatically suggest suitable appointment times to customers via e-mail or the web. These can then be synchronized with the representative or agent's calendar.

TYPES

Small business For small businesses a CRM

system may simply consist of a contact manager system which integrates emails, documents, jobs, faxes, and scheduling for individual accounts. CRM systems available for specific markets (legal, finance) frequently focus on event management and relationship tracking as opposed to financial return on investment (ROI).

TYPES Social media CRM often makes use of social media to build up

customer relationships. Some CRM systems integrate social media sites like Twitter, LinkedIn and Facebook to track and communicate with customers sharing their opinions and experiences with a company, products and services.Trends identified through social media allow businesses to make more accurate decisions on which products to supply.

ADVANTAGES OF CRM

Revenue and profitablity inhancement

Cost saving and reduction Organizational impact Gain customer loyality Increase in Productivity Enhanced customer service Leads to departmental

integration

DISADVANTAGES OF CRM

Expensive implentation Needs additional management

to maintain. Mistaken tool choice make

CRM more complicated Reasentment by employes

towards change due to CRM practices

Major problem of learning curve due to implementation of CRM

FACTS REGARDING CRM

“70% of CRM initiative fail”

Source: Cap Gemini Earnst and Young

“90% of enterprises cannot show a positive return on CRM.”

Source: META group

“75% of CRM initiatives fails to substantially impact the customer experience.”

Source: Gartener

REFERENCES

Customer relationship management: concepts and cases

http://www.gartner.com/newsroom/id/2459015 http://en.wikipedia.org/wiki/Customer_relations

hip_management JISC CRM handbook