Customer relationship management
Customer relationship management
Customer relationship management
CUSTOMER RELATIONSHIP MANAGEMENT
H.SHAMINA,M.B.A,M.Phil,M.Com, Head of MBA,
Rathinam College of Arts and Science, Echanari. Coimbatore.
Introduction:
Customers are the very reason for being in business. Profits can be reaped only if an organization has customers who will pay for the products or services on a continuing basis. It depends on the ability of the entrepreneur to get into the right areas of business for success. Infact , successful entrepreneurs are those who create a market of their own.
One customer ,well taken care of, could be more
Valuable than $10,000 worth of advertising
---Jim Rohn
WHAT IS CRM?
A CRM strategy has numerous aspects , but the basic theme is for the company to become more customer-centric. This does not necessarily create a new revenue stream today or even tomorrow. However it will add customer loyalty to the business's bottom line. Our methods are primarily web based tools and Internet presence because they will allow the company to keep up with the new businesses that provide information about their own and their competitor's products freely. However, CRM will make an impact in all areas of the business.
The business should allow its customers to get current information at any time from any source. This information needs to flow through the organization without getting lost or altered: when CRM is implemented currently, it will show upon the bottom line as positive customer feedback as well as increased revenue.
Established companies are now developing and implementing CRM enabled e-solutions. An obvious advantage of an established company over a new dotcom is that the brand name and confidence of a customer in the presence are already built. A dotcom has to establish this confidence, but a company which stores all around the US are even with an established local presence will already be trusted by online shoppers. Combined with their marketing savvy and years in business, these established companies will be powerful forces in the market place.
The Cost of Acquiring Customers:
Nowadays, the competition is just a mouse-dick away. Embattled companies are slouching towards the realization that without customers, products don't sell and revenues don't materialize. The main way to squeeze every drop of value from existing customers is to know who the best customers are and motivate them to stay that way indeed. A good starter definition of CRM is
The infra structure that enables the delineation of and increase in customer value, and the correct means by which to motivate valuable customers to remain loyal-indeed to but again.
The most forward thinking companies have recognized from past failures that CRM smacks for strategy, and thus technology alone can't address high profile issues such as new-customer acquisition and web-based marketing. To these companies, CRM is much more than a stand-alone project accounted for by a single organization, it's business philosophy that affects the company-at-large.
The following list represents a set of legitimate CRM business objectives :
We want to thoroughly understand our customer's needs-even before they know them themselves.
Decreasing customer churn by increasing customer satisfaction.
Motivating customers to initiate revenue-generating contacts with us.
Increasing the likelihood of the right response' by a given customer or customer segment.
To use technology to improve customer service and enable a greater degree of customer differentiation in order to deliver unique customer interaction.
We want to attract customer's-both old and new-through more personalized communications.
The point here is that there is not one but many visions for CRM's success.
How the internet changed the rules:
The emergency of the Internet heralded a new opportunity for customer relationship building. For one thing, search engines made it easier for customers to find online merchants and interact with them. And , once found, those merchants offered customers more streamlined ways of ordering and receiving products and services.
Moreover, the Internet simplified bidirectional communication, for the first time offering a better way for consumers to relay personal information to the merchant. Instead of waiting to be mailed, a form to open an account or order a phone line, a prospective customer needed only to send an application through cyber space, resulting in a shorter delivery time, improved accuracy, and quite often a positive perception.
At the 2000 Comdex conference in Las Vegas, Cisco CEO John Chambers put a new spin on leveraging customer loyalty with the Internet. He demonstrated a web-connected gas pump that allowed a customer to swipe a loyalty card' swiping the card not only starts the gas flowing, it also illuminates a digital screen displaying personalized messages such as traffic reports, while the customers pumps the gas.
CRM marketing initiatives:
Companies simply don't purchase CRM products to automate campaign management without a clear view of what they want to do.
After all , companies devoid of a marketing vision rarely have sufficient budget for CRM software. Those who do, have a variety of tactics in mind for increasing customer value and loyalty.
Customer Retention:
Analyzing customer attrition operates on the aphorism established keeping an existing customer is far more cost effective than acquiring a new one. After all the more customers leave, the greater the loss of revenue, loss of the initial acquisition investment, and loss of a stable market base for selling new products.
Behavior prediction.
Behavior prediction helps marketing departments determine what customers are likely to do in the future. This analysis include several variations.
Propensity -to-buy analysis. Understanding which products a particular customer is likely to purchase.
Next sequential purchase. Predicting what product are service a customer is likely to buy next.
Product affinity analysis .Understanding its products will be purchased with other products. Also known as Market basket analysis'. It can be viewed as examining products in a shopper's basket to understand possible product associations.
Price elasticity modeling and dynamic pricing. Determining the optimal price for a given product, often for a given customer or customer segment.
Preemptively offering discounts or free waivers to existing customers who are at risk of churning
Refining target marketing campaigns to smaller customers segments are specific products.
Packaging certain products together and fixed pricing makes them to sell more products and increase their profitability.
Cross selling products likely to be purchased with other products.
Customer Satisfaction Measurement:
Survey mailings endure as a principal way for companies to monitor customer satisfaction. Such electronic surveys are becoming increasingly sophisticated serving as the technical equivalent of the focus group albeit with more science and sans the overhead. Companies can randomize their surveys and achieve detailed response reports.
Conclusion:
Without a CRM system that information would not be readily available, and therefore would slow down any remedy that the customer would and should receive. Having a good CRM system and understanding the importance of that can protect both the company and the customers from problems.
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