CusLomer 8elaLlonshlp ManagemenL (C8M)

Learn|ng Cb[ect|ves
ueflne C8M
undersLand Lhe lmporLance of C8M
Lxplaln Lhe deLermlnanLs of C8M and Lhe key sLages ln lLs developmenL
ulscuss Lhe maln funcLlons and varlous models of C8M
Lxplaln Lhe role of salespeople as relaLlonshlp developers
ulscuss Lhe managemenL of cusLomer relaLlonshlps
Jat |s Customer ke|at|ons|p Management (CkM)?
C8M ls Lhe developmenL and malnLenance of mutua||y benef|c|a|
|ongterm relaLlonshlps wlLh strateg|ca||y s|gn|f|cant customers"
(8ottle 2000)
C8M ls an @ enanced va|ue process whlch ldenLlfles develops
lnLegraLes and focuses Lhe varlous compeLencles of Lhe flrm Lo Lhe
'vo|ce' of te customer ln order Lo dellver |ongterm super|or
customer va|ue aL a proflL Lo we|| |dent|f|ed ex|st|ng and potent|a|
customers"
(llokoylooookl ooJ 1zokos 2001)
Dnderstand|ng Customer ke|at|ons|p Management (CkM)?
C8M ls a bus|ness p||osopy based on upon lndlvldual cusLomers
and cusLomlsed producLs and servlces supporLed by open ||nes
of commun|cat|on and feedback from Lhe parLlclpaLlng flrms LhaL
mutua||y benef|t bot buy|ng and se|||ng organ|sat|ons
1he buylng and selllng flrms enLer lnLo a "|earn|ng re|at|ons|p"
wlLh Lhe cusLomer belng wllllng Lo collaboraLe wlLh Lhe seller and
grow as a |oya| customer ln reLurn Lhe seller works Lo max|m|ze
te va|ue of te re|at|ons|p for te customer's benef|t
ln shorL C8M provldes selllng organlsaLlons wlLh Lhe plaLform
Lo obLaln a compet|t|ve advantage by embraclng cusLomer needs
and bulldlng va|uedr|ven |ongterm re|at|ons|ps
eterm|nants of CkM
@rust
1he wllllngness Lo rely on Lhe ablllLy lnLegrlLy and moLlvaLlon of
one company Lo serve Lhe needs of Lhe oLher company as agreed
upon lmpllclLly and expllclLly
Va|ue
1he ablllLy of a selllng organlsaLlon Lo saLlsfy Lhe needs of Lhe
cusLomer aL a comparaLlvely lower cosL or hlgher beneflL Lhan
LhaL offered by compeLlLors and measured ln moneLary
Lemporal funcLlonal and psychologlcal Lerms
eterm|nants of CkM
ln addlLlon Lo trust and va|ue salespeople ost
undersLand cusLomer needs and problems
MeeL Lhelr commlLmenLs
rovlde superlor afLer sales supporL
Make sure LhaL Lhe cusLomer ls always Lold Lhe LruLh
(musL be honesL) and
Pave a passlonaLe lnLeresL ln esLabllshlng and reLalnlng a long
Lerm relaLlonshlp (eg have longLerm perspecLlve)
tages |n te deve|opment of a Customer ke|at|ons|p
@e rere|at|ons|p tage
1he evenL LhaL Lrlggers a buyer Lo seek a new buslness parLner
@e Lar|y tage
Lxperlence ls accumulaLed beLween Lhe buyer and seller alLhough a greaL
degree of uncerLalnLy and dlsLance exlsLs
@e eve|opment tage
lncreased levels of LransacLlons lead Lo a hlgher degree of commlLmenL and
Lhe dlsLance ls reduced Lo a soclal exchange
@e Longterm tage
CharacLerlsed by Lhe companles' muLual lmporLance Lo each oLher
@e I|na| tage
1he lnLeracLlon beLween Lhe companles becomes lnsLlLuLlonallzed
ke|at|ons|p L|fe Cyc|e Mode|
Plgh cooperaLlon
Low compeLlLlon
Low cooperaLlon
Plgh compeLlLlon
1lme
re
re|at|ons|p
stage
eve|opment
stage
Matur|ty
stage
ec||ne
stage
(wllklosoo ooJ oooq 1997)
C|ass Lxerc|se
JhaL should Lhe focus and maln acLlvlLles of a global
salesperson be ln each sLage of Lhe relaLlonshlp
developmenL process?
Jhy? (lease [usLlfy your answer)
Iunct|ons of Customer ke|at|ons|p Management
|rect funct|ons (are Lhe baslc requlremenLs of a company LhaL are
necessary Lo survlve ln Lhe compeLlLlve markeLplace)
roflL
volume and
Safeguard
nd|rect funct|ons (are Lhe acLlons necessary Lo convlnce Lhe
cusLomer Lo parLlclpaLe ln varlous markeLlng acLlvlLles)
lnnovaLlon
MarkeL
Access
Iunct|ons of Customer ke|at|ons|p Management
Management
ec|s|on
rocess
Customer sens|t|v|ty
%ulverslLy
%lnformaLlon
%ulfferenLlaLed
offerlng
Va|ue Creat|on rocess
@ecno|ogy de||very process
%8u
%1echnology lnLegraLlon
%Lfflclency effecLlveness
learnlng
roduct de||very process
%ConcepL Lo launch
%ManufacLurlng process
Customer de||very process
%Supply chaln
%ulsLrlbuLlon
%lnfomedlaLlon (dlsLrlbuLlon
of lnformaLlon)
Va|uebased
trateg|es
%rlclng
%CommunlcaLlon
(5boto et ol 2001)
@e ro|e of sa|espeop|e as re|at|ons|p bu||ders and promoters
Salespeople by
W ldenLlfylng poLenLlal cusLomers and Lhelr needs
W approachlng key declslon makers ln Lhe buylng flrm
W negoLlaLlng and advanclng dlalogue and muLual LrusL
W coordlnaLlng Lhe cooperaLlon beLween Lhe cusLomers and
Lhelr company
W encouraglng Lhe lnLerorganlsaLlonal learnlng process
W conLrlbuLlng Lo consLrucLlve resoluLlon of exlsLlng confllcLs and
W leadlng Lhe cusLomer relaLlonshlp developmenL Leam
are Lhe lndlvlduals ln any organlsaLlon who act bot as re|at|ons|p
bu||ders and as re|at|ons|p promoters
Mode|s of Customer ke|at|ons|p Management
@e Lvans and Lusk|n (1994) mode| for effect|ve
ke|at|ons|p Market|ng
ke|at|ons|p market|ng |nputs
%undersLandlng cusLomer expecLaLlons
%ulldlng servlce parLnershlps
%Lmpowerlng employees
%1oLal quallLy managemenL
ke|at|ons|p market|ng outcomes
%CusLomer SaLlsfacLlon
%CusLomer loyalLy
%;uallLy producLs
%lncreased proflLablllLy
ssessment state
%CusLomer feedback
%lnLegraLlon
(voos ooJ losklo 1994)
Mode|s of Customer ke|at|ons|p Management
@e 8rock and 8arck|ay (1999) mode| of se|||ng
partner re|at|ons|p effect|veness
lndependence
8elaLlve lnfluence
MuLual LrusL
CooperaLlon
Selllng parLner
relaLlonshlp
effecLlveness
Manag|ng Customer ke|at|ons|ps
1he global salesperson musL be lnvolved ln Lhe followlng acLlvlLles ln order Lo |n|t|ate
develop and enhance Lhe process LhaL ls almed aL bulldlng LrusL and commlLmenL wlLh Lhe
cusLomer
n|t|at|ng te re|at|ons|p
Lngage ln sLraLeglc prospecLlng and quallfylng
CaLher and sLudy precall lnformaLlon
ldenLlfy buylng lnfluences
lan Lhe lnlLlal sales call
uemonsLraLe an undersLandlng of Lhe cusLomer's needs
ldenLlfy opporLunlLles Lo bulld a relaLlonshlp and
lllusLraLe Lhe value of a relaLlonshlp wlLh Lhe cusLomer
ChapLer 13 CusLomer 8elaLlonshlp ManagemenL (C8M)
Manag|ng Customer ke|at|ons|ps
1he global salesperson musL be lnvolved ln Lhe followlng acLlvlLles ln order Lo lnlLlaLe
deve|op and enhance Lhe process LhaL ls almed aL bulldlng LrusL and commlLmenL wlLh Lhe
cusLomer
eve|op|ng te re|at|ons|p
SelecL an approprlaLe offerlng
CusLomlse Lhe relaLlonshlp
Llnk Lhe soluLlons wlLh Lhe cusLomer's needs
ulscuss cusLomer concerns
Summarlze Lhe soluLlon Lo conflrm beneflLs and
Secure commlLmenL
Manag|ng Customer ke|at|ons|ps
1he global salesperson musL be lnvolved ln Lhe followlng acLlvlLles ln order Lo lnlLlaLe
develop and enance Lhe process LhaL ls almed aL bulldlng LrusL and commlLmenL wlLh Lhe
cusLomer
Lnanc|ng te re|at|ons|p
Assess cusLomer saLlsfacLlon
1ake acLlon Lo ensure saLlsfacLlon
MalnLaln open Lwoway communlcaLlon and
Jork Lo add value and enhance muLual opporLunlLles
Manag|ng Customer ke|at|ons|ps
ua||fy|ng prospects for re|at|ons|p bu||d|ng
Cpportun|t|es
for add|ng va|ue
otent|a| prof|tab|||ty of customer
Plgh
Low
Low Plgh
Dse a non
custom|zed
approac
eek better
opportun|t|es
e|sewere
8u||d a strong
and |ast|ng
re|at|ons|p
Iocus on
|oya|tybu||d|ng
program
ke|at|ons|p networks
1he ulLlmaLe ouLcome of a successful C8M sLraLegy ls Lhe creaLlon
of a unlque company asseL known as a relaLlonshlp neLwork
A re|at|ons|p network conslsLs of Lhe company and lLs ma[or
cusLomers wlLh whom Lhe company has esLabllshed long and
endurlng buslness relaLlonshlps
1he addlLlonal aspecLs of a global salesperson's [ob are Lo
Manage cusLomer value
AcL as cusLomer advocaLe and
Lnhance cusLomer loyalLy and bulld a healLh" and
proflLable neLwork of relaLlonshlps
ummary
C8M ls a new buslness phllosophy based on LrusL and value
1he core funcLlon of C8M ls Lhe value creaLlon process
CusLomer relaLlonshlps develop over Llme
1he role of global salespeople ln Lhe process ls LhaL of boLh
relaLlonshlp bullders and relaLlonshlp promoLers and
1he baslc premlse of C8M ls Lo offer superlor value Lo
cusLomers ln an efforL Lo Lurn prospecLs lnLo
cusLomers cusLomers lnLo loyal cusLomers and
loyal cusLomers lnLo parLners