Instructions:

1. Don’t be misled by the length of the case;

2. The case length might be short, however, it has depth—read in between the lines and
think through the case to encompass all possible scenarios as well as parameters for
mapping the benefits to the feature set;
3. Please ask the instructor for any clarifications rather than second guessing!

SCENARIO-1
Ritu Kumar is one of India’s leading designers which retails ladies luxury wear through 15
boutiques across all major cities. These boutiques showcase the very best of Indian
design with specially produced range of high fashion garments and. The company has
been growing steadily at an average rate of 8 to 10 percent in the last five years to
achieve a turnover of Rs 27 crore in 2002-03.

The organization wants to become a leading player in the emerging fashion retail
industry. Amrish Kumar, Director explains: Due to the nature of the market and the
position of the company within it, we realised that we need to establish a customer
focus considering our small volumes that provide us the right opportunity to offer
individual customer service across the board. Also the nature of our luxury brand makes
a strong case for pampering customers and providing them with a little extra.

Individual service was not a new concept to the organisation. The sales staff
maintained close ties with customers and their requirements in an informal manner.
Customers, in turn, have rewarded the company with their loyalty. Referrals from
satisfied customers has always been a source of new customers and growth. Now there
was a need to formalize and centralise this process across the outlets in various cities to
manage future growth. Also, the organization was contemplating to establish the return
on investment on customer nurturing as well as tracking customer referrals to measure
profitability and plan loyalty programs.

Amrish elaborated, ‘I had a couple of consultants to look at our business and we found
that by using technology we could become pioneers in an area that is very niche. For a
business that has limited but high-value transactions, effective CRM is critical! The
motivation of staying ahead and gaining added competitive advantages is making us
embark on the CRM initiative. Our business is a low traffic business compared to the
mass retailers like Shoppers Stop. And every person who walks in does not necessarily
buy our products. And there is no way for us to know why they were not buying.
Therefore we decided to profile store walk-ins and link up the stores with the marketing,
merchandising and customer support teams. The automated point of sales (POS)
system needed to be leveraged to give us an integrated view of our customers. All
these efforts should improve customer handling at the stores and enhance
coordination across functions. If a person walks in but does not purchase anything, she
gets captured on the CRM system after the interactions with the sales staff. Some basic
information like name, size, colour, style preference are entered into the system. Later
when the same person comes in, say 6 months later and buys some products, the POS
links to the CRM system through a smart search capability.

The twin objectives of the CRM implementation will be:

• Improve customer service through a better understanding of customer needs.

• Improve business intelligence – The business intelligence aspect is critical as the

prevalent practice is to rely on perceptions and informal data. CRM has been identified
as crucial to help categorise and segment the intelligence requirements more
accurately.

CRM is expected to have a direct impact on the business performance through an

increase in profitability, revenues and the returns on investment. Increased customer
loyalty, better product development and positioning, and improvements in the
productivity of marketing efforts and operational efficiency would drive the
performance improvement.

While choosing the respective CRM, the company would be evaluating based on the
following criteria:

1. Ease of use: the interface screens are required to be simple and descriptive so
that the frontline sales personnel could use them easily;
2. Level of customization;
3. Comfort levels with the solution provider;
4. Affordability;
5. Scalability

The screens are integrated with the existing POS. The screen captures the following
information –

– Name, purchase value, colour, nationality, age group (current anecdotal perception
is that slightly older age group prefers RituKumar. Several marketing initiatives are being
taken to cater to a younger profile. Hence this information is critical).

– Size and alteration (Paper-based graphics are used by the sales personnel to take in
the details. The same graphics need to be transposed to the system).

– Purchase history.

– Places where they usually shop (this information will be useful for retail location
decision when they get into the prêt line, i.e. label).

– Comments and complaints which are consolidated at the store level and shared with
marketing, sales, merchandise, customer service and design merchandise at the
corporate office on a daily basis. They are working with registers at each store which
has issues like consolidation and delays in redressal. Customer comments of colour and
design preferences are passed from all the outlets to the design and merchandising
group at the corporate office for action on a daily basis.

– Some customer seek products which are not currently available in the store. The
system captures this information and passes it on to the corporate office where they
identify trends and also request the factory to develop the products sought by
customers. Then the customers are informed by the stores when the supplies reach the
store.

Some of the features required are customer profiling, calendar and activity scheduling,
customer interaction history, customer segmentation, mass mailing and reports. The
marketing reports will include footfall conversion ratio, direct mail campaign analysis
and campaign ROI. Other reports include summary data on alterations sought, product
returns and complaints.