EMERGING

TRENDS IN INFORMATION TECHNOLOGY SEMINAR

ON

Customer relationship management

- By Mahesh chauhan

contents
What is CRM? Determinants of CRM Components of CRM CRM Cycle Principles of CRM Tasks req. to achieve goals of CRM IT Factors of CRM Reasons for adopting CRM : The Business Customer Relationship Management Drivers

What is crm ???

An integrated cross-functional focus on improving customer retention and profitability for the company. Other Definitions could be: Process of creating and maintaining relationships with business customers Customer Relationship Management or consumers

determinants of crm
Trust
The willingness to rely on the ability, integrity, and motivation of one company to serve the needs of the other company as agreed upon implicitly and explicitly.

Value
The ability of a selling organisation to satisfy the Customer Relationship Management needs of the

What is crm ???

CRM is an abbreviation for Customer Relationship Management, not Customer Relationship Marketing. Management is a broader concept than marketing because it covers marketing manage., Manufacturing management, human resource management, service management, sales management, and research and development management. Thus, CRM requires organizational and business level approaches which are customer centric to doing business rather than a simple marketing strategy.

Customer Relationship Management

COMponents of crm
CUSTOME R

CR M
RELATIONS HIP MANAGEME NT
Customer Relationship Management

Components of crm

Customer:
The customer is the only source of the companys present profit and future growth. However, a good customer, who provides more profit with less resource, is always scarce because customers are knowledgeable and the competition is fierce. Businesses are not to paid to reform customers, they are paid to satisfy customers Peter Ducker
Customer Relationship Management

Components of crm

Relationship:
The relationship between a company and its customers involves continuous bi-directional communication and interaction . The relationship can be short term or long term, continuous or discrete, and repeating or one-time. Relationship can be attitudinal or behavioral. Even though customers have a Customer Relationship positive attitude towards company and its products , Management their buying

Components of crm

Management:
CRM is not an activity only within a marketing department. Rather it involves continuous corporate change in culture and processes. The customer information collected is transformed into corporate knowledge that lead to activities that take advantage of the information and of market opportunities. CRM required a comprCustomer Relationship ehensive change in the organization and its people. Management

crm cycle

Interact and Deliver Interact and Deliver Acquire Acquire Understand and Differentiate Understand and Differentiate Deploy and Customize Deploy and Customize

CRM
Customer Relationship Management

CRM

c ycle

Interact and Deliver:

Interact with customers & prospective customers Deliver increased value to customers

Acquire and Retain:

Acquire customers & prospective customers Retain valuable customers

Understand and Differentiate:

Understand customer needs Differentiate based on customer needs, characteristics &

behavior

Deploy and Customize:

Develop products, services, channels to meet customer

needs
Customize by

Customer Relationship Management customer segments

principles of crm
The overall processes and applications of CRM are based on the following basic principles. Treat Customer individually Acquire and retain customer loyalty through Personal Relationship Select Good customer instead of Bad customer based on Lifetime value. In summary , personalization, loyalty , and lifetime value are the main principles of CRM implementation.
Customer Relationship Management

How to achieve goals of crm

Four basic tasks are required to achieve the basic goals of CRM. [Peppers, et al., 1999] Customer Identification
To serve or provide value to the customer ,the company must know or identify the customer through marketing channels, transactions , and interactions over time.

Customer Differentiation
Each customer has their own lifetime value from the companys point of view & each customer imposes unique demands and requirements for the company.

Customer Interaction

Customer demands change over time. So keeping track of customer behavior & needs is an important task of CRM.

Customization/ Personalization

Treat each customer uniquely is the motto of the entire CRM process .
Customer Relationship Management

IT factors of crm
Traditional (mass) marketing doesnt need to use information technologies extensively because there is no need to distinguish, differentiate, interact with, and customize for individual customer needs. Although some argue that IT has a small role in CRM, each of the four Interaction Process Identification Differentiation key CRM tasks depends Customization heavily on information technologies and systems.
Goal Identify individual Evaluate customer customers value and needs Clustering Build a continuing relationship Call centre 1. Fulfil customer needs 2. Generate Profit 1. Sales 2. Services

Traditional Not Done mass Marketing CRM

Customer Profiling Individual Level analysis

1. Call centre 1. Sales automation management 2. Marketing process 2. Auto response system automation 1. Web Application 2. Wireless Communication 1. ERP 2. E-Commerce

Information technologies

1. Cookies 2. Web Site personalization

1. Data Mining 2. Organization learning

Customer Relationship Management

Reasons for adopting crm :

The business drivers Competition for customer is intense. From a purely economic point of few, firms learned that it is less costly to retain a customer than to find a new one. By Paretos principle it is assumed that 20% of a companys customers generate 80% of its profits. In industrial sales, it takes an average of 8 to 10 physical calls in person to sell a new customer, 2 to 3 calls to sell an existing customer. It is 5 to 10 times more expensive to acquire a new customer than obtain repeat business from an existing customer. A typical dissatisfied customer tells 8 to 10 people about his or her experience. A 5% increase in retaining existing customers translates into 25% or more increase in profitability.
Customer Relationship Management

benefits of crm
It is a business strategy that applies to almost every organization; therefore almost all organizations stand to gain from its use.
Customers are motivated to return again and again as they receive good customer service and continue to do business. CRM enables a company to target their audience more precisely and gain customer retention, all at a lesser cost. CRM delivers company-wide access to customer information. Builds customer loyalty and decreases customer loss. It enables an organization to create detailed profiles such as customer likes/dislikes etc. CRM gains the trust of customers by meeting their needs in a more personalized way. Companies opting for CRM find it easy to identify new selling opportunities.
Customer Relationship Management

boosting customer loyalty:

a big +
Customer retention is imminently important for organization success as the cost of acquiring a new customer is greater than holding onto an old customer. The customer centric strategy of the decade CRM achieves customer loyalty with ease.

TYPES OF CUSTOMER RETENTION PROGRAMS : Discount Programs Card Programs Loyalty Programs
Customer Relationship Management

boosting customer loyalty:

a big + Benefits of customer retention programs :
They permits the collation of important customer data. They allow the usage of this data in the understanding and dealing of customers. The data collected is often used while making valuable customer decisions. They assist in making the customer feel special. They boost customer service and thereby increases customer loyalty.

Pitfalls of customer retention programs :

The main inhibition in this area is the cost factor. Customer retention program often involve huge costs to the organization & therefore most firms are reluctant to embark on this. In this respect it is important to focus on the possible returns rather than the cost Customer Relationship involved as customer retention is a direct simulator for profitability Management and growth.

crm - Who leads the pack ?

With the wide variety of CRM software available in the market one wonders who to choose. There will always be those who excel in any field.Some of the leaders are :

Oracle
Oracle CRM boasts of excellent storage and usage of customer information besides an amazing ability to streamline processes and the ability to improve the quality of data as well. Accurate information is Oracle CRM's best.

Salesforce
Salesforce's CRM options are based on customers' needs and offer excellent integration with all non CRM business applications.

Siebel
Siebel solutions boast of shorter implementation time. They are customized to fit industry needs. Siebel solutions provide employees and customers with accurate, relevant and up-todate information. Simplicity and functionality are the keywords Customer Relationship when dealing with Siebel's CRM solutions. Management

Closing comments
CRM requires a cultural change with organizations. CRM can be enabled by technology, but this alone will not deliver business benefits Change Management is vital The customer experience needs to be consistently enhanced. Its an ongoing business process and will create sustainable competitive advantage.
Remember :

If you arent listening to your customers,

Customer Relationship Management

Thank you for your valuable time

Customer Realtionship Management