Customer Relationship

Management

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 Introduction

Customer Relationship Management (CRM) is defined

as the aligning of business strategy with the corporate
culture of the organization, along with customer
information and a supporting information technology of
the customer interactions that promote a mutual
beneficial relationship between the customer and
enterprise.

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 Gathering Customer Information
Widespread implementation of customer information,
Enterprise Resource Planning systems, sales force
automation and integrated point-of-sale systems have
made customer information readily available in large
volumes. Reduced costs and higher levels of
performance for database management platforms allow
us to gain access to this customer information and gain
new insights into our customers and their behaviour
through a variety of analysis methods.

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 E-Channel, Channel & CRM
Internet provides a totally new way for an enterprise to interact
with its customer, the electronics channel or e-channel. Beyond
the glamour developing the e-channel, business is investing
heavily to deploy CRM in traditional channels. In most cases
these capabilities are developed independently, requiring
expensive integration later on to achieve the vision of true
customer relationship management an enterprise-wide scale.
Integration of these resources is one of the key challenges of
successful deployment of CRM across the enterprise.
All the functions and channels must come together to develop an
enterprise-wide strategy for CRM. Only then the information
technology can fully integrate them with maximum efficiency &
effectiveness based on unified information architecture.

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 Why CRM Solutions are required
CRM solutions are especially valuable to companies that
face the following circumstances:
• Business is driven by mission-critical customer service
requirement
• Current cost of maintaining customer information is too
high
• Large volume of information is distributed
• A complete customer care solution is needed

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 Strategies for CRM
The strategy for CRM can be visualized in 3 stages.

• Customer Information Environment

• Customer Value Orientation
• Customer Loyalty

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 Customer Information Environment
In the first stage, building up of a customer information
environment and acting on it forms the starting point. It
consists of :
• Metric Program
• Customer Information Repository
• Customer Profiles
• Transactions & Behaviours

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 Customer Value Orientation
In the second stage, operational effectiveness is the
focus. Customers value for their money. They believe
that they have got value, when the perceived benefits
they receive from something exceed the costs of
owing it. The componensts are :
• Behaviour Analysis
• Profitability Analysis
• Lifecycle Modelling
• Tuned Marketing

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 How Technology Help CRM?
• Reducing cost per Contact
• Decreasing development
• Creating emotional bond
• Reducing human error
• Increasing flexibility
• Improving interactivity
• Increasing continuity
• Increasing quality
• Providing reassurance
• Increasing reliability
• Increasing scalability
• Improving responsiveness
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 Features of CRM Product
A CRM toolkit covers a wide diversity of channels. In order
to bring true customer management across online business,
one needs the CRM product to fulfil the following criteria :
Content : Is the system delivering the contents a customer
want to see? How is it being managed on the IT platform?
E-mail Management : Are e-mail campaigns focused to
provide an offer that customer can’t refuse? How are these
tied in websites so that a customer enjoy seamless
experience

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 CRM-Toolkit (Cont.)
Customer Management : Is the company managing data
across all the sales and marketing functions to its best?

E-marketing : How well are e-marketing efforts

targeted? How well do they combine with online selling
operation?

Assisted Selling : One need to analyze, that whether

assisted sell model would help to achieve business
success. The business model of Dell helps their business
but it may be not the be the true for all the organization.

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 Web-based & Web-extended CRM
The term E-CRM is not generally used as the CRM is now
heavily depended on electronic media. Web is an integral part of
CRM. E-CRM can be divided into 2 categories : Web-based
CRM & Web-Integrated CRM.
Web-based CRM : This solution is designed from the bottom-up
exclusively for the internet. These are very innovative products
initially focused on sale. Over the time marketing & service
capabilities are being added.
Web-extended CRM : These solutions are established CRM
suites, originally designed for enterprise users with extensions to
include web interface functions.
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 Phase of CRM
There are 3 major phases of CRM.

• Acquisition
• Enhancement
• Retention
Acquisition : Acquiring new customers by promoting
product/service leadership that pushes performance
boundaries with respect to convenience. The value
proposition to the customer is the offer of a superior
product backed by excellent service.
Enhancement : Enhance the relationship by cross-selling & up-
selling. This deepens the relationship. The value proposition to
the customer is an advantage with greater convenience at low
Cost.
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 Phase (Cont.)
Retention : Retaining the profitable customers for
life should be aim. Retention focuses on service
adaptibility, i.e. it delivers not what the market wants,
but what the customers want. The value propostion to
the customer enhances a proactive relationship that
works well with the best interest of customers. Today,
leading companies focus on retaining existing
customers much more than attracting new customer.


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 Activities of Each Phase
Acquisition :
Innovation
Convenience
Enhancement :
Reduced Cost
Customer
Service
Retention :
Listening
New Products

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 Enterprise Capabilities Regarding
Customer
In order to maintain a customer-focus approach and as well as to do
the business, individuals throughout the enterprise must have access
to set of capabilities necessary to plan and manage customer
interactions. This is categorized in 2 ways :
1. Operational, Tactical or Strategic capabilities to the enterprise
2. Acquisition, Retention and expansion of customer relationship

The purpose of the above capabilities is to gather customer

information and use this information to modify customer behaviour
in a mutual beneficial way.
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 Interaction of Customer with
Enterprise
To look at these previously mentioned capabilities from the
perspective of the customer, it is necessary to realize how the
customers interact with the enterprise over the time, as the
Enterprise :
1. Acquires the initial customer relationship
2. Works to earn the customer’s persisting loyalty
3. Expands the relationship to gain a greater share of each
customer’s purchasing potential

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 Customer Life Cycle
These activities represent a cyclical process of interactions
between each customer and the Enterprise, represented as
the Customer Life Cycle (CLC). Using CLC as a tool we
can see how CRM capabilities affect customer interactions
at various point in lifecycle.
The picture in next slide depicts this concept.

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 Customer Life Cycle (CLC)
Global Marketplace

Acquisition

Consumers Evaluation
Attrition Prospective
Customers

Retention

Service
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 CRM Capabilities & CLC
Customer acquisition consists of the business processes in
the CLC leading up to the customer moment, when
consumers become customers or not. This includes
awareness generation, knowledge transfer, consideration,
pre-sales and evaluation.
Capabilities include consumer surveys in business
operations, tracking enterprise-wide customer interactions
in business management and market basket analysis in
business intelligence. The enterprise clearly requires
customer acquisition to maintain and expand revenues and
profits.
CRM, which is customer-centered nature of business
application organizes business around the customer rather
than marketing, sales or any other internal functions.

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 CRM Capabilities & CLC
Measurements and feedback from the customer enables the
the improvements in the CRM process. The customer’s
viewpoint becomes an integral part of process, allowing it to
change with the customer’s needs.

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