Overview Of CRM

Overview of CRM

Learning Objectives

At the end of the course, participants should be able to do the following:

Explain the concepts of CRMExplain the concepts of eCRMIdentify the difference between CRM and

Traditional MarketingIdentify the difference between CRM and

Database MarketingIdentify the relationship between CRM and

eCRM

“Customer Relationship Management is a comprehensive strategy and process of acquiring, retaining and partnering with selective customers to create superior value for the company and the customer.”

- Parvatiyar and Sheth

“Customer relationship management is about attracting, developing, maintaining and retaining profitable customers over a period of time.”

- Massey, Montoya-Weiss & Holcom

“CRM relates to strategy, managing the dual-creation or value, the intelligent use of data and technology, the acquisition of customer knowledge and the diffusion of this knowledge to the appropriate stakeholders, the development of appropriate (long-term) relationships with specific customers and/or customer groups and the integration of processes across the many areas of the firm and across the network of firms that collaborate to generate customer value.”

- Boulding, Staelin, Ehret and Johnston

CRM versus Traditional Marketing

Traditional marketing focus on the four Ps (price, product, place and promotion) for increasing market share through increase in the volume of transactions between seller and buyer. While customer relationship management focus on using strategies, procedures, tools and technology for promoting the relationship between the seller and customer so as to increase sales revenue, profitability and customer satisfaction.

Attributes of Market Exchanges

Attribute Marketing Through 4Ps Transactions

Marketing Through Relationships, Networks, and

Interactions1. Actors The buyer has a generic need and the

seller has a generic offerThe buyer has a particular need, and the seller has a unique offer

2. Nature of marketing exchange The products or services are standardized

The products or services are customized

3. Interaction between actors The interaction between actors are characterized in terms of, for example, power, conflict and control

The interaction between actors are characterized in terms of, for example, trust, commitment and cooperation

4. Duration of marketing exchange The duration of marketing exchange is independent and discrete

The duration of marketing exchange is on-going

5. Structural attributes of market place

The structural attributes of market place is characterized as an anonymous and efficient market

The structural attributes of market place is characterized in terms of numerous networks to a network approach

6. Marketing approach The marketing approach is the 4Ps or the marketing mix

The marketing approach is marketing through relationships, networks and interactions

Source: Lindgreen and Antioco, Customer Relationship Management

Components of CRM

Business Drivers of CRM

• Averagely, the cost of retaining a customer is less than that of acquiring a new one.

• A dissatisfied customer may become aggressive opposition

• Advances in electronic commerce provides wide range of relationship opportunities for boosting customer loyalty and satisfaction

Assumptions of CRM

• Current information is right• Consumers prefer individual, differentiated

treatment, services and products• The future behaviour of consumers depends

on their past behaviour

Myths of CRM

Successful CRM needs complete customer data and a very large database

CRM is a gigantic projectVery good CRM technology system guarantee

excellence in businessSegmentation is a prerequisite to CRMCRM needs highly advanced analytics

Key Cost Goals of CRM & Action Points• Trim down cost of sales and distribution

- Deploy web applications for reducing sales force- Manage customer relationships instead of products- Use focused advertising to target customers

• Boost sales revenue growth by increasing customer satisfaction- Enhance sales by cross-selling- Enhance sales by up-selling

• Reduce customer support costs- Provision of appropriate level of information to customer facing personnel- Call center automation for easy access to information

• Reduce cost requirements for customer satisfaction- Manage customer experience- Deploy customer profitability analytics

CRM versus Database Marketing

Database marketing is a company-centric technique which focus on using discount programmes and promotions to sell more products to customers for less cost: Therefore it’s difficult to use it for building customer loyalty. While Customer relationship management focus on enduring relationship with customers by identifying and providing customer values in the context of customer’s viewpoint and not based on the company’s opinion: Therefore it’s easy to use it for building customer loyalty.

eCRM

eCRM involves matching and blending people, processes and technology for enabling an organisation to attract, retain and partner with customers to facilitate enhancement of value to both customers and the organisation.

CRM versus eCRM

The infusion of applicable electronic technology including database-driven software, business intelligence and web systems to the customer relationship strategy of a firm so as to achieve established objectives depicts eCRM. While CRM focus on the generic application of a firm’s customer relationship strategy in achieving established objectives.

Customer relationship management provides opportunity for expectations of customers to be properly identified, explored and used for controlling value proposition with the aim of increasing customer satisfaction.

Customer Expectations Versus Experienced Service

Model A Model B

Benefits of eCRM to a Firm• Transaction security• Personalized services • Relationship with customers• eMarketing• Using email for communication• Enhanced workflow• Large data storage• Advanced analytics• Time efficiency

Benefits of eCRM to Customers

• Convenience• Confidence• Service quality• Transaction process speed• Structured interaction

Steps for Achieving Goals of CRM

• Customer Identification• Customer Differentiation• Customer Interaction• Customization

Dr. Elijah Ezendu is Award-Winning Business Expert & Certified Management Consultant with expertise in HR, OD, Competitive Intelligence, Strategy, Restructuring, Business Development, Sales & Marketing, Interim Management, CSR, Leadership, Project & Programme Management, Cost Management, Outsourcing, Franchising, Intellectual Capital, eBusiness, Social Media, Software Architecture, Cloud Computing, eLearning & International Business. He holds proprietary rights of various systems. He is currently CEO, Rubiini (UAE); Hon. President, Worldwide Independent Inventors Association; Special Advisor, RTEAN; Director, MMNA Investments Limited. He had functioned as Chair, International Board of GCC Business Council (UAE); Senior Partner, Shevach Consulting; Chairman (Certification & Training), Coordinator (Board of Fellows), Lead Assessor & Governing Council Member, Institute of Management Consultants, Nigeria; Lead Resource, Centre for Competitive Intelligence Development; Turnaround Project Director, Consolidated Business Holdings Limited; Lead Consultant/ Partner, JK Michaels; Technical Director, Gestalt; Chief Operating Officer, Rohan Group; Executive Director (Various Roles), Fortuna, Gambia & Malta; Director, The Greens; Chief Advisor/Partner, D & E; Vice Chairman, Refined Shipping; Director of Programmes & Governing Council Member, Institute of Business Development, Nigeria; Member of TDD Committee, International Association of Software Architects, USA; Member of Strategic Planning and Implementation Committee, Chartered Institute of Personnel Management of Nigeria; Adjunct Faculty, Regent Business School, South Africa; Adjunct Faculty, Ladoke Akintola University of Technology, Nigeria; Editor-in-Chief & Chairman of Editorial Board, Cost Management Journal; National Executive Council Member, Institute of Internal Auditors of Nigeria; Member, Board of Directors (Several Organizations). He holds Doctoral Degree in Management, Master of Business Administration and Fellowship of Several Professional Institutes in North America, UK & Nigeria. He is an author & widely featured speaker in workshops, conferences & retreats. He was involved in developing Specialist Master’s Degree Course Content for Ladoke Akintola University of Technology (Nigeria) and Jones International University (USA). He holds Interim Management Assignments on Boards of Companies as Non-Executive Director.

Thank You