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Crm unit 1
Customer relationship management (CRM) refers to the principles, practices and guidelines that an organization follows when interacting with its customers. CRM involves compiling customer data, analyzing customer behavior, and developing customized communications to retain and attract customers. The goal of CRM is to improve customer service, increase customer retention and loyalty, and maximize profits.
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Crm unit 1
- 1. Customer relationship management(CRM) refers to the principles, practices and guidelines that an organization follows when interacting with its customers. Jyostna Jain
- 2. UNIT 1 Concept,Evolution of Customer Relationships: Customers as strangers, acquaintances, friends and partners Objectives, Benefits of CRM to Customers and Organisations, Customer Profitability Segments, Components of CRM: Information, Process, Technology and People, Barriers to CRM Relationship Marketing and CRM: Relationship Development Strategies: Organizational Pervasive Approach, Managing Customer Emotions, Brand Building through Relationship Marketing, Service Level Agreements, Relationship Challenges
- 3. EVOLUTION OF CRM The Beginning:About 70 years back, in the 1950s, as businesses grew, memory gave way to Pen, Paper and Pad for collecting, tracking and storing relevant customer information. Database Marketing:In the early and late 1980s, Database Marketing took center stage, which allowed the organizations to compile customer data and analyze information to develop customized communication for retaining and attracting customers.In the later part of the decade, PCs took the market by storm which enabled the companies to organize customer data and provide insight into their behavior. Sales Force Automation:In the early ‘90s, customer relationship management gained credence and a boom in the software development market introduced Sales Force Automation for organizations, which improved the sales processes and increased the efficiency. Customer Relationship Management:And finally, in the year 1995, the term CRM came into being. In the late ‘90s, CRM kept evolving and the first CRM system was developed and also, for the first time, Software-as-a-Service or SaaS product was introduced in the CRM industry.
- 4. Undaunted Striver Empowered Trendy Outgoing optimistic Savvy maximizer Brainhunter Family oriented Confident Practical Content Streamer Suspicious Own values Price conscious Secure Traditionalist Independent Comfortable Saver Categories of customers
- 5. FEATURES OF CRM Customers Needs Customer satisfaction Customer response Customer loyalty Customer retention Customer complaint Customer service
- 6. BENEFITS OF CRMTO CUSTOMERS Benefit of better service Improved relationship Social relationship Involvement in process
- 7. BENEFIT OF CRMTO ORGANISATION Identification of potential customers Increase profitability Decrease operating costs Increased customer loyalty Improved customer satisfaction
- 8. DISADVANTAGES OF CRMIN AN ORGANISATION Focuses only on customer retention Legal and ethical issues Discrimination among different group of cutomers
- 9. TYPES OF CRM Collaborative Geographic Salesintelligence analytical operational
- 10. OBJECTIVES OF CRM Providing services and products that are exactly what your customers want Offering better customer service Retaining existing customers and discovering Lower level of operating cost Aiding the marketing department
- 11. FACTORS FOR THEGROWTH OF CRM Growth of telecommunication technology Online retailing facilities Hyper competition Total quality management Expensive marketing cost Globalisation
- 12. CUSTOMERS BUYING ROLE The initiator: The person who suggests buying a product or service The influencer: The person whose point of view or advice will influence the buying decision The decision maker: The person who will choose which product to buy The buyer: The person who will buy the product
- 13. 7 C’S OFCRM • Recognizes the customer choices for buying in ways convenient to them Convenience • Service and satisfaction wanted by customers Customer value and benefit • The real cost that customers will pay Cost to customer • Supplying products at right time place and quantity Computing and category management • Maintaining strong relationship with customer Customer care and service • Culmulative image of a product held by customer Customer franchise • Feedback from customers to suppliers Communication and customer relationships
- 14. PROCESS OF CRM 1.Crm formation process: in this stage organization identifies class of customers with whom relationship needs to be maintained in the long run. 2. Relational parties: this involves selection of parties with whom to engage co-operative or collaborative relationship. 3. Crm programs: these programs are meant for different classes of customer which includes: one to one marketing continuity marketing partnering programs ( co-branding and affinity partnering) 4. Performance Evaluation: periodic assessment of results in crm is needed to evaluate if programs are meeting expectations of customers and sustainable in long run
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- 16. TOOLS USED INCRM FOR DATA COLLECTION Electronic point of sale Sales force automation Customer service helpdesk Call centres System integration kiosks
- 17. BARRIERS TO CRM Wrong implementation Lack of commitment Quality of data Resistance to change Unclear objectives Work stress
- 18. Relationship marketing is aboutforming long-term relationships with customers. Rather than trying to encourage a one-time sale, relationship marketing tries to foster customer loyalty by providing exemplary products and services. Relationship marketing
- 19. Difference between Transactionaland Relationship marketing Transactional Marketing Focuses on single point of sale Emphasize on maximizing individual sales volume Recruitment of customers for single sale Product oriented Short time horizon Low contact with customers Relationship Marketing Seeks to establish long term relationship with customers Emphasize on all the stakeholders. Customer retention oriented Long term horizon High contact with customers
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- 21. WEB-BASED CRM Web-based CRMis a software solution where there is no hardware or software located on the customer's premises (on-premise). The software is hosted on a range of servers in data centres that are maintained and managed by a third party. The application is accessed through a web interface and not loaded on local PCs or Laptops.
- 22. ADVANTAGES OF WEBBASED CRM SOFTWARE SOLUTION CRM web based software charges on subscription basis is less expensive in the short term Easy to start interacting with customers through CRM software Gives uses friendly web interfaces and self-service administration tools. Easily suitable to accommodate growing business model.
- 23. BRAND BUILDING THROUGHRELATIONSHIP MARKETING Brand loyalty Brand awareness Perceived quality Brand associatio ns
- 24. SERVICE LEVEL AGREEMENTS A service-level agreement (SLA) defines the level of service you expect from a vendor, laying out the metrics by which service is measured, as well as remedies or penalties should agreed-on service levels not be achieved. It is a critical component of any technology vendor contract.
- 25. ELEMENTS OF SLA Over all objective: The SLA should set out the overall objectives for the services to be provided. For example, if the purpose of having an external provider is to improve performance, save costs or provide access to skills and/or technologies which cannot be provided internally, then the SLA should say so. This will help the customer craft the service levels in order to meet these objectives and should leave the service provider in no doubt as to what is required and why. Description of the Services The SLA should include a detailed description of the services. Each individual service should be defined i.e. there should be a description of what the service is, where it is to be provided, to whom it is to be provided and when it is required. Performance Standards :, the customer should state the expected standards of performance. This will vary depending on the service. Often a customer will want performance standards at the highest level. Whilst understandable, in practice this might prove to be impossible, unnecessary or very expensive to achieve Compensation/Service Credits: where the service provider fails to achieve the agreed performance standards, the service provider will pay or credit the customer an agreed amount which should act as an incentive for improved performance Critical Failure Service credits : are useful in getting the service provider to improve its performance, but what happens when service performance falls well below the expected level? If the SLA only included a service credit regime then, unless the service provided was so bad as to constitute a material breach of the contract as a whole, the customer could find itself in the