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CUSTOMER RELATIONSHIP MANAGEMENT (EVOLUTION (Supply Chain Management,…
CUSTOMER RELATIONSHIP
MANAGEMENT
WHAT IS CRM
Definition
CRM is “the development and maintenance of mutually beneficial long term relationships with strategically significant customers”
(Buttle, 2000)
CRM is “an IT enhanced value process which identifies, develops, integrates and focuses the various competencies of the firm to the ‘voice’ of the customer in order to deliver long term superior customer value, at a profit to well identified existing and potential customers.”
(Plakoyiannaki and Tzokas, 2001)
What is CRM
Proper management of customer
interactions
Building and maintaining profitable customer
relationships
Delivering superior customer value and satisfaction.
Main Focuses
To create customer loyalty
To portray a positive corporate image
To attract potential customers.
EVOLUTION
Supply Chain Management
Manufacturing Resource Planning
Enterprise Resource Planning
Materials Requirements Planning
Customer Relationship Management
IMPORTANT ASPECTS
OF CRM
A RELATIONSHIP INSTEAD OF A
TRANSACTION VIEW
Creating Customer Loyalty
sending personal letters,
reminding by phone,
sending thank you cards,
choosing the field in which they are the best,
rewarding those who send new customers,
preparing events and occasions peculiar to customer,
evaluating the customer complaints in detail and giving quick replies.
MOVE FROM PRODUCT TO CUSTOMER
AS UNIT OF ANALYSIS
From Product Lifecycle to Customer Lifecycle
From Product Portfolio to Customer Portfolio
From Marketing Mix to Customer Management
Product Centric
Price
Place
Product
Promotions
Customer Centric
Customer development
Customer retention
Customer acquisition
INDIVIDUAL CUSTOMER LEVEL VIEW
Share of Wallet / Share of Customer
Power balance – customer has more power
Customer potential
STRATERGIES
Customer Profitability
Customer profitability is an important part of any customer relationship
strategy.
– We determine the service levels to individual customers
– We determine the investment in acquiring a new customer
– The return on investment of marketing efforts
– We have to communicate the importance of customers to employees
Profitability levels
Individual customer analysis
Strategic level analysis
Customer Aquisition
Acquisition Funnel
Liking
Conviction
Knowledge
Purchase
Awareness
Acuring new customers
Advertise on company innovation and competitive edge
Offer bundled promotions and service
Promoting company’s products and service
Challenges in acquiring new customers.
Learn from customer
Understand customer values
Identifying customer
Access to customer profiles
Customer retention
Retaining profitable customers
Deliver what customer wants
Provide value proposition to customers
Customer Loyalty
Loyalty
A commitment to re-buy or re-patronize a preferred product or
service consistency in the future, despite situational influences and marketing efforts having the potential to cause switching”
Satisfaction
A persons feeling of pleasure or disappointment from comparing
a products perceived performance relative to his or her expectations.
Customer Development
Customer development = efforts to increase the profitability of current customers.
Up selling
Increased the frequency or amount of current purchases
Cross selling
Increase mark up
CRM Types
• Operational CRM
• Analytical CRM
• Collaborative CRM
CRM Software
Implementation Stratergies
Cloud Based CRMs (for relatively smaller organizations)
On Premise CRMs (for larger organizations with sensitive data)
Benefits
• Integrated customer information
• Central database of customer contacts
• Provides service quickly and efficiently
• Inside knowledge about customers
• Enables 24/7/365 operations
• Individualized system
• Improved information
Speeds problem identification/resolution
• Speeds processes
Improved integration
• Improved planning