INTRUDUCTION MEANING OF CRM
The need to better understand customer behavior and the interest of many managers to focus on those customers who can deliver long-term profits has changed now marketers view the world. Traditionally marketers have been trained to acquire customers, either new ones who have not bought the product before or those who are currently competitors Customers. This has required heavy doses of mass advertising and price-oriented promotions to customers and channel member. Today, particularly for the company’s “best” customers the tone of the conversation has changed form customer acquisition to retention. This requires a different mind set and a different and new set of tools. A good thought experiment for an executive audience is to ask them how activities. While it is difficult to an executive versus retention activities from each other the answer is usually that acquisition dominates retention. CRM is neither a product nor a service, But a business strategy to learn more and mare about the customers’ behavior them. In other words, CRM is a comprehensive approach that provides seamless integration of every aspect of bank’s business that come in contact with the customer at various stages such as marketing, service delivery after –sales –service etc. through the integration of people, process and technology. It is a comprehensive strategy and process of acquiring, retaining and partnering with selective customers to create supervisor value for the bank and its customers. The concept of customers relationship marketing (CRM) has stemmed up from this very problem of traditional marketing. CRM recognizes the concern for both traditional function of marketing and its scope with a goal of developing a cross functional, coordinated focus on customers that is to reorient the entire business to face the market. The focus of marketing has changed from acquiring new customers to retaining old ones. This requires a different mindset and a different and a new set of tools. A good thought experiments for an executive audience is to ask them how much they spend or focus on acquisition versus retention activities. While it is difficult to perfectly distinguish the two activities from each other, the answer is usually, that acquisition dominates retention. The following table suggests the evolution of Customers Relationship Marketing:
Period 1950’s Focus Area Customer Good Marketing
1960’s Industrial Goods Marketing 1970’s 1980’s 1990’s Marketing of Non-Profit Organization or Societal Marketing Services Marketing Customers Relations Marketing
In 1990’s the concept of Relationship Marketing has emerged strongly and the focus has been changed from Transaction Marketing to Relationship Marketing as shown below: Transaction Marketing Focus on Single sale Relationship Marketing Focus on customers retention Orientation on product benefits
Orientation on product features Short timescale
long timescale High customer service emphasis
Little emphasis on Customers Service Limited customer commitment Moderate customer contract Quality is primarily a concern of Production
High customer commitment High customers contact Quality in concern for all
A FRAMEWORK FOR CUSRTOMER RELATIONSHIP MARKETING
A problem is that CRM means different things to different people. For some, CRM means direct e-mails. For others, it is mass customization or developing products that fit individual customers needs. For IT consultant, CRM translate into complicated technical jargon related to terms such as OLAP (on line analytical processing) and CICs (customer interaction centers). What do managers need to know about their customers and how is that information used to develop a complete CRM perspective?
It is explained with the help of following procedure: Create a Database Analysis Customer Selection Customer Targeting Relationship Marketing Privacy Issues Metrics
• • • • • • •
A database of customer activity. Analysis of the database. Given the analysis, decision about which customers to target. Tools for targeting the customers. How to build relationship with the targeted customers. Privacy issues Metrics for measuring the success of the CRM Programme.
CREATING A CUSTOMER DATBASE
A necessary first step to a complete CRM solution is the construction of a customer database or information file. This is the foundation for any customer relationship marketing activity. For web-based businesses, construction of a database should be a relatively straightforward task as the customer transaction and contact information is accumulated as a natural part of the interaction with customers. For exiting companies that have not previously collected much customer contract data form internal involve seeking historical customer contract data form internal sources such as accounting and customer service. Ideally the database should contain information about the following: Transaction - This should include a complete purchase history with accompanying details (Price paid, SKU, delivery date). b. Customer Contact - Today there is an increasing number of customer contact point from multiple channels and contexts. This should not only include sale calls and service requests but any customer or company-initiated contact. c. Descriptive Information - This is for segmentation and other data analysis purposes. d. Response to Marketing Stimuli - This is part of the information file should contain whether or not the customer responded to a direct marketing initiative, a sales contract or any other direct contact. This data should also be represented over time.
ANALYZING THE DATA
Given the range of marketing tools available that reach customer one at a time. In this kind of data analysis patterns of mouse “clicks” are examined from cyber store visits and purchase in order to better understand and predict customer behaviour.
3. Direct marketers have used such techniques for many years.
Given the construction and analysis of the customer information contained in the database the next step is to consider which customers to target with the firm’s marketing programs.Traditionally customer database have been analyzed with intent to define customer segments. depending on the nature of the product or service. Rather there is increased attention being paid to understanding each ‘row’ of the database-that is understanding each customers and what he or she can deliver to the company in terms of profits and then. Taking a large number of customer and forming groups or segments presumes a marketing effort towards an “average” customer in the group. The idea is that each row/customer of the database should be analyzed in terms of current and future profitability to the firm.g. using tailored messages designed for small groups of customers (What has been referred to as “1-to-1” there is less need to consider the usual market segmentation schemes designed for small groups of customers. Their goals are to target the most profitable prospects for catalogue mailings and to tailor the catalogues to different groups. If segmentation type analyses are performed on purchasing or related behaviour the customers in the most desired segments (e. When a profit figure can be assigned to each customer the marketing manager can then decide which customers to target. highest purchasing
. addressing either customer individually or in small clusters. The goal is to increase conversion rates the percentage of browsing customer to actual buyers. such segmentation approaches have been heavily criticized. More recently. As a result of new “lifetime customer value” (LCV) has been introduced into the lexicon of marketers. As noted a new kind of analysis born form the Internet is the click stream analysis. A variety of multivariate statistical methods such as cluster and discriminate analysis have been used to group together customers with similar behavioral patterns and descriptive data which are then used to develop different product offerings or direct marketing campaigns.
If individual customer based profitability is also available through LCV or similar analysis it would seem to be a simple task to determine on which customers to focus. No matter what criterion is employed de-selected customers need to be chosen with care. as this does a better job incorporating potential purchase. In particulars the new mantra. RELATIONSHIP PROGARMES
. direct mail. This allow the manager to fire customers that are too costly to service relative to the revenues being produced. Once driven away or ignored unhappy customers can spread negative word or mouth quickly particularly in today’s Internet age. but they are poorly suited or CRM due to their impersonal nature. Customers with high LCV could be chosen. Another approach would be to take the current profitability. An obvious problem is that by not accounting for a customer’s possible growth in purchasing. More conventional approaches for targeting selected customers include a portfolio of direct marketing methods such as telemarketing. The marketing manager can use a number or criteria such as simply choosing those customers that are profitable (or projected to be) or imposing and ROI hurdle. and. An extremely popular form the Internet based direct marketing in the use of personalized e-mails.
TARGET THE CUSTOMERS
Mass marketing approached such as television radio of print advertising are useful for generating awareness and achieving other communications objective. The goal is to use the customer profitability analysis to separate customers that will provide the most long term profits from those that are currently hurting profits.
4. Other segment can also be chosen depending upon additional factors. when the nature of the product is suitable direct sales. However these customers are difficult to predict and you might include a large number of unprofitable customers in the selected group. you could be eliminating a potentially important customer. The 80/20 rules often holds in approximation.rates greatest brand loyalty) would normally be selected first for retention programs. “1 to 1” marketing has come to mean using the Internet to facilitate individual relationship building with customer. most of a company’s profits are derived form a small percentage of their customers. 5.
such programs have become a competitive necessity. this is a situation where the manager had decided not wait for customer prior to complaining or other behavior sparking a reactive solution. positive relationship between customer satisfactions an profits. as staking away benefits and perhaps most importantly. Most companies today have established infrastructures of deal with reactive service situation through toll free telephone numbers. It is increasingly difficult to gain competitive advantage. as customers see the company. There are expensive mistakes can be difficult to correct. Research has shown that there is a strong. Proactive service is a different matter. fax back systems.While customer contact through direct e-mail offerings is a useful component of CRM. e-mail addresses and a variety of other solutions. Sets of relationship programs that can be employed are as follow:
Programs designed to enhance customer service are normally of tow types: Reactive service is where the customer has a problem (product failure question about a bill product return) and contacts the company to solve it. There has been a large volume of research in this area. A problem that can be added to this list is that due to the ubiquity of these programs.There have been identified some problems with these programs. it is more of a technique for implementing CRM than a program itself. Thus managers must constantly measure satisfaction levels and develop programs that help to deliver performance beyond targeted customers expectations. Relationships are not built and sustained with direct e-mail themselves but rather through the type of programs that are available for which e-mail may be a delivery mechanism.
Loyalty/ Frequency programs
Loyalty programs (also called frequency programs) provide rewards to customer for repeat purchasing . there are large questions about whether they work to increase loyalty or average spending behavior. The overall goal of relationship programs is to deliver a higher level of customers satisfaction than competing firms deliver. In addition in some industries.
not simply communicating with them. There is an obvious tradeoff between the ability of companies to better deliver customized products and services and the amount of information necessary to enable this delivery.
The CRM system depends upon a database of customers information and analysis of that data for more effective targeting of marketing communication and relationship building activities. In this way the manager can build and environment that makes it more difficult for the customer to leave the family of the other people who also purchase from the company.
One of the major uses of the web for both online and offline businesses is to build a networks of customers for exchanging product related information and to create relationships between the customer and the company or brand.
Involve a set of tools that companies employ to evaluate the effectiveness of their CRM programs.The notion of mass customization goes beyond 1-to-1 marketing as it implies the creation of products and services for individual customers. The goal is to take a prospective relationship with a product and turn it into something more personal. Particularly with the popularly of the internet many customers and advocacy groups are concerned about the amount of personal information that is contained in database and how it is being used thus the privacy issue extends all the way through the hierarchy of steps outlines.
REALIONSHIP MARKETING STRATEGIES
. The goal is to take a prospective relationship are called communities.
2. 5. cements the business through its quality. purchase and safekeeping of securities. Customers pay only for those services they select. and provides a base for the selling of additional services over time. asset management. By learning about the specific characteristics and requirements and individual costomers. and offers a platform form which other financial services can be sold. investment analysis. A firm might use all five simultaneously.salem.
1. 3. is long-term in nature. has multiple parts.
Core Service Strategy Relationship Customization Service Augmentation Relationship Pricing Internal Marketing
These strategies are not totally independent of another and can be used combination. Five such strategies are:
2. financial record keeping. In this program customers select those specific services they wish from a package of services including tax preparation. multiple parts. budget assistance. cash analysis. 4. The ideal core service is one that attracts new customers through its need –meeting character.There are a number of possible relationship marketing strategies to be considered in the development of a relationship marketing plan. insurance analysis.
A key strategy in relationship marketing is the design and marketing of a `core service’ around which a customer relationship can be established. An example of a core service is the “individual financial services” program offered through the trust department of Wachovia bank and trust headquartered in Winston. North Carolina. Core services are directed toward central rather than peripheral target market needs. affluent consumer need that many banks fail to address.
Customizing the Relationship
The nature of services affords many services firm the opportunity to customize the relationship. and estate planning. and then capturing these data for use as needed. bill paying . and long term nature. The individual financial services program address. service firms
a multi-lingual staff. and room amenities including terry. Frequently they are performed by people who are in the position to custom-fit the service to the customer’s particular requirements. a field service representative is sent to the customer’s site. The representative can instantly access data concerning the customer’s locations. the customer finds them beneficial and therefore prefers doing business with the company that supply them. services are performed. For example. a mint and cognac with the evening turn – down service. When this is the case. D. the extras must be genuine extras. More that 60% of the Fairfax Hotel guest have stayed there previously.cloth robe. Whereas goods are manufactured. The Fairfax attempts to differentiate itself with its upscale target market by providing concierge service.can more precisely tailor service to the situation at hand. customer loyalty is encouraged. and its service record. the customer calls ‘work support representative’ on a toll free number. linen laundry bag and bathroom telephone. For meaningful service differentiation to occur.that is. As Levitt writes : ‘Having been offered these extras. The possibilities for relationship customization are considerable.
Another relationship marketing strategy is service augmentation. not readily available from competitor – that are valued by customers.
. Xerox has introduced a service system called ‘Field Work Support System’ that involves keeping the history of a customer’s equipment in a computerized data bank. In so doing they provide their customers with an incentive to remain as customers rather than ‘starting over’ with other suppliers. especially when personal service capabilities are combined width electronic data processing capabilities. equipment.
3. If the problem cannot be worked out over the telephone using a computer checklist. When assistant is required. night butler and 24-hours room service. Service augmentation involves building ‘extras’ into the service to differentiate it from competitive offerings. If the customer receives custom service from company A but not form Company B – and if receiving custom service is valued by the customer – then the customer is less likely to leave company A for B than would otherwise be the case. a morning newspaper delivered to all guest rooms.’ One practitioner of service augmentation is the Fairfax Hotel in Washington.C.
another strategy option available to service companies pursuing customer loyalty. There is no membership fee to belong to Club marquis. Marriott’s Club Marquis provides still another example from the hotel industry. Semi-annual newsletter. and individual must stay at Marriott hotels on five separate occasion and have their visits validated.
Member also receiving and identification card and personalized luggage tags. Express check-out. The hotel examples used demonstrate the inherent flexibility of service augmentation. newsletters and the like. Most deluxe accommodations in the rate category requested. Club Marquis memberships are honored at all Marriott properties.
An old marketing idea – a better price for better customer – forms the basis of
relationship pricing.One from of service augmentation becoming more prominent is the ‘preferred customer club’. which
. the concept is applicable only to hotel. Relationship pricing mean pricing services to encourage relationships. customers are given a price incentive to consolidate much or all of their business with one supplier. So is the car rental company that provides time –saving services to members of a preferred membership club and the bank that conducts business managements seminars for its small business clients. Complimentary Wall Street Journal delivered to the room each morning. Pre-registration. Although the concept of quantity discounts is not new. some service companies are applying the concept in innovative ways. The use of hotels examples does not mean. The qualify for membership. Reservations automatically guaranteed for late arrival. By inviting priority customers to join a company – sponsored club. the service company augments the offer with special services and added prestige while establishing a vehicle to stay in touch with these customers through promotional mailings. Members receive the following service:
• • • • • • •
Express reservation service through a toll-free number. In effect. however. The ‘frequent flyer’ program of various airlines. The ‘extras’ can be anything so long as they are valued by the target market and not easily matched by competitors. The real estate company that spends a portion of land anticipated listing commission to cosmetically upgrade a home prior to marketing it is using service augmentation.
the quality of services sold is determined in large measure by the skills and work attitudes of the personal producing the services. What is known in marketing about selling and reselling them goods and services can also used in selling and reselling them jobs. In these organizations. It is especially important.
As with the other relationship marketing strategies presented. Minnesota Power and Light and GEICO are among the service companies that have regularly used small group meetings between senior management and employees to encourage
. Survey results are discussed with the management of the hotel property and shared with upper management at Marriott headquarters. so can they be used for the same purposes in the internal marketiplace. A poll of more than 6000 frequent flyers indicated that 77% of the respondents were participating in an airline frequent flyer incentive program. Offering services that consistently meet the quality requirements of target markets is clearly an important factor in building strong customer relationship in any service industries. The process one thinks of as marketing – for example. Internal marketing is relevant to virtually all organizations. Just as marketing research procedures can be used to identify needs. relationship pricing can be implement in various ways in various service industries. market segmentation. they improve their capability to offer quality service. and communications programming – are juust as relevant to internal marketing as to external marketing. for labor – intensive service organizations. Marriott Corporaation. marketing research. and motivate quality personnel.offer travelers upgrades to first class seating and free trips if they fly a certain number of miles on a given carrier. To the extent that labor – intensive service firm can use marketing to attract. keep. annually surveys employees at each of its hotels about their jobs. in internal marketing. product modification. wants and attitudes in the external marketplace. however. are an attempted to build brand loyalty in what many regard as a commodity business. just as necessary.
5. The stress placed on customer satisfaction in external marketing is Justas appropriate.
A pivotal relationship marketing strategy for many service firms is internal marketing. The usage in this paper is the employee as the customer and the job as the product. for instance. There are several forms of internal marketing. The people who buy goods and services I the role of consumer are the same people who buy jobs. What all forms have in common is the ‘customer’ is inside the organization.
The tools and techniques of marketing research can help. This problem gets compounded as customer expectstions for quality. developing a close. In essence. the marketing task is not only that of encouraging external customers to buy but also that of encouraging internal customers to perform. that lead to the right service personnel performing the service in the right way. they must first be identified. symbiotic relationship with customers has become highly important than ever before. Banks can leverage on these new inventions of science to develop. internal marketing involves creating an organization climate in general. Most of the Indian banks are
. Thanks to the development of IT and ?Internet. It employee needs and wants are to be satisfied. In consumption circumstances in which the performance of people is what is being sold. service and insight. service and value are increasing rapidly on a continuous basis.dialogue and feedback. and job-products in particular. the likelihood of external customer continuing to buy is increased. acquire new ones and at the same time adopt procedures to win back the lost customers. which are changing the possibilities in terms of customer contact.
With hot winds of competition blowing across the Indian banking industry. When internal customers perform. today banks can aim at meeting this expectation by adopting a strategy that is commonly known as Customer Relationship Management. Banks have to come out with innovation measures to satisfy the needs of their present customers.
“CRM – THE NEW FACE OF MARKETING” IN THE BANKING SECTOR
3. design and implement CRM strategies in their business processes.
The recent research indicates that some of the behavioural traits such as adaptation. cooperation.
Customer Relationship: What And How?
Before discussing about the ‘customer’ relationship’ in detail. power equation etc.now turning to CRM as they are increasingly realizing that the cost of acquiring new customer is far higher than the cost of retaining existing ones. agents. Their quest for more effective way to woo and retain customers end with the Implementation of CRM models in their business practices. therefore. past satisfaction. it is the power equation – the ability of one party to evoke a change in other partner that greatly influences the continuity of any relationship. interdependence. A relationship can terminate from any of these stages. intimacy. both by the bank as well as its customer. ‘Continuity’ of a relationship is a function of the communication used in extending the cooperation. it should reflect a multidimensional approach that encompasses the dimensions of continuance. Relationships are not built overnight. a customer is any indivual eho has a relationship with the bank from time to time. It is. Cross-selling or upselling can be attempted at certain stages to get better results. the definition of ‘customer’ is broader and covers partners. repair and dissolution. third parties. ‘Commitment’ is another essential ingredient for cementing the relation. In the final analysis. However. pave the way to building up relations as also to sustain them over a long period. They pass through different stages namely contact. conflict resolution. commitment.. employees and of course the end customers. it is important to first examine “who a customer is ?” Quite often people wrongly perceive customers as indivuasuals who use the service of bank i.
. They no longer see CRM as an optional and expensive add-on but as a ‘must’ to survive in this ever-increasing competitive market.e. normative components and effective components.. Put simply. essential for a bank to understand the stage at which it could better sell banking services. Alignment of bank’s resourses with customer’s needs is directly proportional to the quantum of trust injected into the relationship . ‘Adaptation’ is the prime skill that banks needs to cultivate to tailor their resourses to meet the specific needs of the individual customer. communication. involvement. trust. the end users. Secondly. tracing the disagreement that creeps into the business transaction and style in which these conflicts are resolved. A bank has to necessarily be committed towards the customer for nurturing a fruitful relationship. deterioration.
a call center agent can maintain client data/information. rational and more apt in the given context. facilitating decision-making. of which. media advertisements or through referrals from exiting customers.As the strategy behind the management of customer relationship is basically concerned with sustaining relationship. A bank to function with the laid down laws of the nations has to necessarily know its customers and decision to sell a credit product/service demands a thorough scrutiny of the customer profile. it moves around the management of customer life cycle. Front-end staff of a bank can profile a customer. In a nutshell. and address and track customer service requests. And that is where the modem concept of CRM through IT-enabled service applies to the banking system. the customer related data is sizeable. This multidimensional goal calls for a wealth of data. customer information can be shared faultlessly between front-end staff facing the customers to deliver services and the back-office staff who structure the deals. branches can identify the underlying causes for such migration and accordingly redraft their relationship management strategies to minimize future attritions. A typical customer relationship starts with acquisition of customers through personal visits. create and maintain a customer account with contacts. Similarly. It provides management with a clear picture of the business. replies to customer inquiries. produce call notes. But there is a danger of the customer migrating form the relationship. Using a common architecture and data model. Using the historical database. and explore business development possibilities. but at what stage and for what reasons the customer is migrating has to be assessed by the individual bank branches. bank branches can easily afford cross-selling and up-selling. A bank being an intermediary essentially collects deposits from savers and lends to entrepreneurs at a spread. Once the customer equity is built up. In the process it assumes the role of a repository of the national economy.
How Does CRM Affect the Business of Banking?
CRM has a number of positive effects on the running of a bank. Then the cycle movers on to customer development by way of personalized communication and offering customized products and services based on what is mutually considered as good. As a result its decisions need to be timely. implementation of the CRM concept in banks can result in the following advantages:
• • •
Speed and accuracy in information analysis Foundation for organization-wide data and information Understanding customer behaviour
. manage activities.
etc. requests for information and technical support. uninterrupted. field sales Multiple customer groups – customers. investment. corporation etc. small business. deposits. the bank can present a single face to the customer and offer better services. By integrating front – and back – office systems to include reports of all customer contact. but also to boost the profitability of every indivuasual client/customer and. In other words.
. purchase of services/products.
IMPLEMENTING CRM IN INDIAN BANKS
A bank’s success in the field of CRM fully depends in its ability to achieve ‘customer intimacy’.• • •
Facilitating business process re-engineering Multiple products – credit. internet. enabling the bank to maximize customer’s experience. CRM’s very motto is not only to attract new clients/customers or hold valuable ones. integrated. call center. And ‘customer intimacy’ can be achieved by understanding and influence a customer’s behaviour through relevant. the bank as a whole.
4. hence. Multiple distribution channels – branch. Such an interface enables banks to access the potential of customer from time to time and offer him the customized products to augment profits. organization – wide view of the customer. and personalized communication. the major goal of CRM is to build a single.
• High value/more profitable customer desiring high-grade service. • High value/more profitable customer desiring low-grade service. and physical and psychological characteristics.
Offering Vs. sensitivity etc. A bank’s CRM system must also capture customers’ tastes.Suffice to say. have thousands and millions of customer relationships in their portfolio. banks must realize that all customers are not equal. a more profitable customer is a ‘high value’ customer and a less profitable customer is as ‘low value’ customer. Put simply. Hence. preferences. Customer profitability varies from person to person/context to context and not all customers are evenly desirable for the banks. Customer Classification
To start with.
Once the banks differentiate their customer vis-à-vis the profitability and their other traits. on the contrary. Banks must differentiate their customers based on the ‘value criteria’ i. By combining the profitability potential of a given customer and his/her personality profile including their expectations. customers can be grouped in to four categories as follows : Low value/less profitable customer desiring high-grade service. how valuable the customer is? Value is nothing but the profit a customer adds to the bank’s account. it becomes easy for banks to customize their services and offerings to maximize the overall value of their customer portfolio. cultural background. “it is five to ten times cheaper to retain present client/customers than to acquire new ones”.
b. living style. it is practically impossible to satisfy the subsequent needs of each
. age education. A customer has only a single relationship with the bank when he purchases products and services. • Low value/less profitable customer with potential to become high value in coming days. behaviour. Banks.
Sticking to Exiting Clients
According to a research by a software company (Magic Software Enterprises).e. getting the CRM philosophy work in a bank is quite complex as well as a challenging task for the strategists for it demands them to master some key principles of CRM such as :
a. Understanding the needs and imperatives of every individual exiting client is at the heart of CRM.. and so understands the bank. while differentiating them by the value criteria into low and high value customers.
they must acquire new customers while keeping their present customers satisfied. They have to innovate to meet every need of their customers so that they become their active advertiser while remaining on the loyalty arc. But as acquiring a new customer is costlier than retaining the exiting one. retention of customer becomes a challenging task.
c.” Passive loyalty is a term used to describe customer who have not transacted with the bank in the absence of a better alternative. Active loyalty means “repeat purchases and contracts made within an appropriate time period. They make the mistake of assuming that customer satisfaction is present in case of passive loyalty and in this process they fail to retain their customer. It. Rather.
d. Thus. Loyalty can be defined as “making a customers bank again and again with the same bank. 2.” Banks must keep their customers serviced and happy so that they keep transacting with them.
Information needed for an Effective CRM Solution
Bankers planning to implement CRM would require a large amount of information about their bank and customer base covering the following:
1. Banks must have the ability to promote an individual from being a suspect to become an advertise.
How to Retain a Customer
A customer can be retaining by boosting his loyalty. ”Unfortunately most of the Indian banks fail to distinguish between active loyalty and passive loyalty. banks must have a clear understanding of their customers’ unfulfilled needs and must come out with products/services that will satisfy those needs.
Information about the bank Market information Demographic distribution of present segment of customers by: Age Sex
. 3. banks must always try to retain their exiting customers to the extent possible by thoroughly and regularly meeting their needs. To boost customer loyalty. Turning a suspect into an active advertiser will definitely boost the ‘referral sales’ that are otherwise know as ‘low cost + high margin sales. however does not mean that the banks should not add new customers to their portfolio. Customer loyalty can be differentiated into two categories: active loyalty and passive loyalty.” Similarly.and every exiting customer to the same level what he/she had enjoyed at the beginning to the relationship.
Customer information at the individual level:
Personal information (name. its plotting and deployment can cause headaches to bankers. disinterests.
o o o o
About bank’s valuable/best customers: Products/services they purchase for The segment they belong to Their habits. tastes. lockers. habits and preference
Current Technology Options and Availability of CRM Suites Though integration of CRM platform is not a difficult concept. This is so because multiple views of customers are accumulated in different databases and repositories with a bank. However. e-business channels. qualification etc. direct sales departments etc. One of the major requirements is to have a single view of the customer. while other customer information is stored in back-office systems that handle tasks such as safe custody. they might not be able to share information. cash management etc. family background. credits. bill collection. this problem could be overcome by using CRM suits and traditional data warehousing and mining products and thereby ensure the display of a ‘single view’ of every customer at any given point of time. forex.
. and splitting them out would be costly. address. If these systems are made by different vendors. remittances departments besides new outfits like call cetters. Some customer information is stood in several customer touch such as deposits.o o o
Level of income Qualification Marital status
4. preferences Their businesses and future prospects
o o o
The customer group/segment to which the individual belongs Present and past behaviour record Interests.
The study to be conducted hold its importance as it revels to the banks that customers may switch over to another bank if complaint are not removed or services are not up to mark. Is it necessary to set up a Specialized CRM division? To be successful. the success of CRM programs too depends on cooperate management and vision. So. CRM suites are available from various vendors across the globe including some Indian vendors. the philosophy of CRM calls for an organization-wide approach. so that they understand the value/profit that each individual customer adds to the bank and how his/ her future needs will vary form the present needs.
5. Now a days customer wants zero-defect products or services and in such a case their complaints have to be rectified frequently. warehousing and mining must be made available to everybody. Over the years.
NEED OF THE STUDY
In today’s world of cut throat competition every business unit wants to survive and earn profits. public and private sector is competing to gain more marketing share shares. This change must be initiated by the top management. XML. many CRM programs have failed primarily dew to inadequate staff support. Responsibility of Bank Staff in the Successful Implementation of CRM like other applications and programs. Nowadays. suites offered by vedor like Oracle. In banking industry. data understanding. and must allow the participation of lower-level staff members. However. The customer is king today and dictates his on terms to get the best services form the bank he deals with.
. However. At this point. NET as well as C++ and customer-context servers. It also helps in identifying what additionally needs to be done to keep the customer satisfied all the times. especially in service sector. SAP or Siebel are often preferred as they can integrate with back office functions. CRM needs the bank culture to shift from being “task –oriented to result – oriented”. So to maintain long term relations with customers and make him satisfied with services is another very important factor. building relations with customers and providing them the best is very important. the fact is how to retain the old customers rather than to attract new customer. PeopleSoft. There is no need to set up a specialized CRM division.Future application possibility will employ the open standards of J2EE.
the study is important as it brings out the importance of CRM in today’s service sector. ICICI.
7. As a management student. d. To understand the factors contributing to the image formation of the banks. e. To know brand loyalty of the customer of the bank. c.
PROFILE OF BANKS
. IDBI Bank and Bank of Punjab. To know how frequently complaints made by customers are rectified or suggestions given are brought in practice.The study holds its importance for all the banks as it acts as a feed back from customers regarding relationship building and customer satisfactions.
The entire project is concentrated upon following objectives: To study the level of satisfaction of customers of HDFC.
6. To make a comparative analysis as to which bank is excelling in customer relationship marketing in the city of Patiala. b.
20. The bank's American Depository Shares are listed on the New York Stock Exchange (NYSE) under the symbol.513. the promoter of the bank has entered into an agreement with National West minister
Bank Pc.89 bn (US$ 56.40 bn (US$ 569 mn) for the year ended March 31. 2005).3.3% of the equity is held by Foreign Institutional Investors (FIIs) and the bank has about 190. Mumbai and the National Stock Exchange. The HDFC Group holds 22. 1994.4.
History The Bank was incorporated on 30th August. 2006.1994 from RBI as of December
31.9 crore (Rs.The bank transacts both traditional commercial banking as well as investment banking. HDFC.3 bn) at March 31. and its subsidiaries (Natwest Group) for subscribers 20% of the banks issued capital and providing technical assistant in relation to the banks proposed banking business. 25. ICICI
ICICI Bank is India's second-largest bank with total assets of about Rs. 2.450 crore (Rs. Certificate of commitment of business was received on 10th October. the bank had a India network of 583 branches in 263 cities in India and over 1471 ATM's.05 bn (US$ 449 mn) for the year ended March 31.4% of the equity is held by ADS Depository (in respect of the bank's American Depository Shares (ADS) Issue).
The paid-up capital is Rs.200 ATMs.
2. (HDFC) . 2006 (Rs. ICICI Bank has a network of about 614 branches and extension counters and over 2. 2006 and profit after tax of Rs. . ICICI Bank offers a wide range of banking products and financial services to corporate and
.311.1% of the bank's equity and about 19. a premier housing finance company.000 shareholders.5 billion). The bank is the first of its kind of receive an in principle approval from the RBI for establishment of a bank in the private sector. The shares are listed on the Stock Exchange. The authorized capital of HDFC Bank is Rs. Roughly 31.1 billion). A new private sector Bank promoted by Housing Development Corporation Ltd.1.
• The ICICI has announced the launch the mobile banking services for its customers.ICICI Bank currently has subsidiaries in the United Kingdom. Sri Lanka and Dubai International Finance Centre and representative offices in the United States. one of the two cellular service providers in Chennai. an Indian financial institution. • ICICI Bank has tied up with the Siddhivinayak temple trust to enable the bank’s infinity (Internet banking) customers to order and pay for a pooja online. enabling non-resident Indians (NRIs) to purchase a Ford Ikon car for their friends and relatives in India. for which the Company has tied up with ICICI Bank and HDFC Bank. ICICI become the first Indian company and the first bank or financial institution from non-Japan Asia to be listed on the NYSE. Hong Kong.
Various steps taken by Bank for increasing CRM
SkyCell Communications Ltd. Bahrain.00 billion (US$ 10. both directly and through a number of subsidiaries and affiliates like ICICI Bank. At June 5. have been integrated in a single entity.8 billion) ranked third amongst all the companies listed on the Indian stock exchanges. • Ford India has tied up with ICICI Bank to introduce a scheme. In 1999. ICICI Bank was originally promoted in 1994 by ICICI Limited. The principal objective was to create a development financial institution for providing medium-term and longterm project financing to Indian businesses. using the wireless application protocol (WAP) technology. with free float market capitalization* of about Rs. has tied up with ICICI Bank to enable its customers to use Internet banking facility for the payment of telephones bills. In the 1990s. on the occasion of “Aandaraki Chaturthi”. both wholesale and retail. 480. branches in Singapore. South Africa and Bangladesh. ICICI Bank. 2006.
. China. the ICICI group's financing and banking operations. United Arab Emirates.ICICI Bank's equity shares are listed in India on the Bombay Stock Exchange and the National Stock Exchange of India Limited and its American Depositary Receipts (ADRs) are listed on the New York Stock Exchange (NYSE). Russia and Canada. • ICICI Bank has tied up with Chennai Telephones to provide Internet bill payment facility to its customers. has launched ‘Sky Banking’. ICICI transformed its business from a development financial institution offering only project finance to a diversified financial services group offering a wide variety of products and services. the Government of India and representatives of Indian industry. • The Finance portal “India Infoline” has tied up with ICICI Bank and HDFC Bank for banking back-ends. Consequent to the merger. • Tata Tele services Ltd. and was its wholly-owned subsidiary ICICI was formed in 1955 at the initiative of the World Bank.
• ICICI become the first financial institution to go for placement of dematerialized debt securities. the card will be operation by the end of August this year.com”. • “electricmela. • ICICI Bank launched its debit card under the brand name “ICICI NCash”. • As parts of its drive to introduced alternate delivery channels ICICI Bank has launched mobile banking facilities in conjunction with spice communications. • Spice cell has tied up with ICICI Bank for mobile bill settlements.com”. • The Kerala Government has joined hands with ICICI Bank to introduce Internet banking facility in the State’s public sector undertakings. To be named ICICI Bank –BPL Mobile Credit Card. • ICICI Bank and Deutsche Bank have entered into a long-term rupee interest rate swap benchmarked to Government bond yields. • The Bank has entered into a wire-transfer arrangement called ‘Money21India’ with the United Arab Emirates Largest foreign exchange house for transfer of funds to India. the online trading site for chemicals and chemical products. • ICICI Bank has launched its interactive touch screen Kiosk ‘Sparsh’ at its automated teller machine (ATM) centers and branches allowing free access to its online services.
. Ltd. launched by Chembazaar online Pvt.com” to provide value added services to its customers. • ICICI Bank has introduced Web-based product that facilities on-line conclusion of forex deals in the city. To be named ICICI Bank BPL Mobile Credit Card. • The Bank has tied up with “Munshikaka. the B2B portal for the electrical industry is entering into an alliance with ICICI Bank for payment gateways. • Visa international and ICICI Bank on September 10. 2001announced pilot programme for facilitating e-commerce in the country. • ICICI Bank and UAE Exchange Centre have entered into a wire transfer arrangement. • ICICI Bank and BPL Mobile have tied-up to launch a co-branded credit card. • ICICI Bank acquired Shimla in Darjeeling Branches from Slandered Charted Grind lays Bank. • ICICI Bank has tied up with Advantage e-accounting to offer an on-line taxation and personal finance services along with off-line services like filling. for electronic and telex transfer of funds.ICICI Bank will provide credit for online transaction over “chemb. • ICICI Bank and BPL mobile have tied up to launch a co – branded credit card.
two of India’s premier financial institutions. IDBI bank is constantly looking for ways and means to serve better. proposes to come out with a set of innovative schemes focusing on retirement planning. • IDBI Bank is to launch mobile banking as part of its retail banking initiatives. • IDBI Bank has launched ‘Money Home’. the 50: 50 joint venture mutual fund of IDBI and Principal Financial Service of the US. • IDBI Principal AMC. SIDBI. Reuters and Synergy Log-In to revamp its technology platform in line with its new focus area of retail banking. This is also reflected in their corporate slogan” What can I do for you?”. a premiere technology driven scheduled commercial bank. • IDBI Bank has tied up with Infosys. a housing loan product with a fixed rate and floating rate option. 1994 under the Companies Act. IDBI bank was promoted by IDBI and SIDBI.
.3. IDBI was set up as a wholly owned subsidiary of RBI to provide credit and other facilities for the development of industry. • IDBI Bank launched its pioneering “smart card” product under the brand Money Smart at Renukoot in Uttar Pradesh.
History IDBI Bank Ltd. The Bank was granted a ‘ in principle’ license by RBI to carry on banking business in India. promoted by IDBI. • The Bank has kicked off its restructuring programme by setting up corporate and retail banking divisions in addition to an e-commerce team. • IDBI Bank has launched Money Smart card for commercial transaction in Mumbai. The bank was incorporated on 15th September.
Various steps taken by Bank for increasing CRM
IDBI Bank singed an agreement with Gemplus and Worldwide Smart Net to launch smart cards-based solutions and Worldwide Smart Net to deliver Multi Application Payment Chip Operating System smart cards for its Indiawide electric pursue rollout. 1956.
• IDBI Bank has launched a retail investment product for the retirees and voluntary retirement seekers. Ban galore. PNB India has Rupee Drawing Arrangements with 15 exchange companies in UAE and 1 in Singapore. launched Money Mobile. Besides. undivided India. Chennai.IDBI Bank. bank has Rupee Drawing Arrangements with 15 exchange companies in the Gulf and one in Singapore. the bank offers efficient forex dealing operations in India. its wireless application protocol and short messaging service mobile banking services. Mumbai. PNB is always focusing on expanding abroad and till date has identified some emerging economies abroad. From its modest beginning. It has strong correspondent banking relationship which Punjab National Bank maintains with over 200 leading international banks all over the world enhances its capabilities to handle transactions worldwide. the bank has grown in size and stature to become a front-line banking institution in India at present.5 crore customers through 4520 branches including 439 extension counters . Hyderabad and Ahmedabad. Bank is a member of the SWIFT and over 150 branches of the bank are connected through its computer-based terminal at Mumbai. Calcutta. Considering the importance of small-scale industries bank has established 31 specialized branches to finance exclusively such industries. Delhi. Hyderabad.
PUNJAB NATIONAL BANK
PNB is professionally managed bank with a successful track record of over 110 years. Punjab National Bank (PNB) has the distinction of being the first Indian bank to have been started solely with Indian capital. With its state-of-art dealing rooms and well-trained dealers. Punjab National Bank India maintains relationship with more than 200 leading international banks world wide.
. • The Bank has tied up with American Express whereby Amex cardholders can access IDBI Bank ATMs to withdraw cash. The bank has been conscious of its social responsibilities by financing agriculture and allied activities and small-scale industries (SSI). simultaneously at Bangalore. Punjab National Bank is serving over 3. The bank was nationalized in July 1969 along with 13 other banks. It even has its branches in small town in both urban as well as rural areas.
4. • IDBI Bank has forged an alliance with MTNL in Delhi to held the account holders of the bank to pay their phone bill through ATMs and Internet. Kolkata. Punjab National Bank has its Branches in all the 7 metropolitan and cosmopolitan cities in India namely New Delhi. They are in few of these places. Established in 1895 at Lahore.largest amongst Nationalized Banks. Indore and Mumbai.
insurance and financial sectors. o The Bank has put in place a 24-hour customer care centre enabling secure Online Banking and information services. o Over and above its own ATM Network the customer of Bank of Punjab would also be able to access hundreds of ATMs of other Master Card Member bank in India and over 5. an extensive library and the latest IT tools.
As a tribute to the memory of its founder late Dr. SWADHAN and CIRRUS International Card Network. Bank of Punjab has set up a state-of-the-art. Inderjit Singh Institute of Banking and Insurance Management at Gurgaon. o Bank of Punjab has made a strategic tie up with Master Card International for its MASTERO. o The Bank has already launched its e-banking services and mobile phone banking for its customers as value added services. of truly international standards. Dr. near Delhi. is equipped with comprehensive training aids. employees and the world of Banking.
8.40.• • • • • •
Shanghai China London Kabul Afghanistan
Various steps taken by Bank for increasing CRM
Bank of Punjab has a wide area network of branches across the country. The institute provides an ideal learning environment for professionals from banking. The bank has established correspondent banking relationships across 60 countries. The first among pear banks.000 worldwide displaying ‘CIRRUS’ logo. o The Bank’s reach is further being extended through over 5000 merchant establishments that would be accepting the Bank’s ‘e-bank” card and the Maestro Debit Card from Master Card. the residential institute. REVIEW OF LITERATURE
. Inderjit Singh and his commitment of giving the very best to customers.
Tangibility. Courtesy. Both these parameters help in bonding of buyer and seller thus improving their relationship. CRM has become full-fledged subject of importance today. recovery. security. Later the author condensed it to five categories viz. 1988) suggested that the criteria used by customers are important in moulding their expectations. Competence. Ganesan (1994) suggested that long-term orientation in buyer-seller relationship is important. these are Tangibility. in his DBA dissertation visualized the importance of Customer Services. price. Parker (1958). responsiveness. as it is the function of two things: mutual dependence and trust between them. He described the “United States” as well advance into device revolution that would significantly change consumer behavior.
. precipitations and hence satisfaction. new standards of services succeeded in the market where established competition has failed to please today’s demanding customer.Many studies and researches have been conducted relating to CRM by various researches and some of them have been discussed below: Lovelock (1996) – The services sector of the economy is going through a period of almost revolutionary properties in which established ways of doing business continued to be shunted aside. Understanding and access. Lewis and Smith (1989) investigated the expectation and precipitation of banks and building society retail customers with regard to 39 elements of services divided into 4 dimensions as Physical features. Around he world. Assurance and Empathy Gronross added the sixth dimension i. reliability. As per Mc Dowell (1953). reliability. innovative new offering. asked the question “Are goods and services different? And launched the goods versus services debate. place. communication. fir ten dimensions. Reliability. During this period the Marketing was at infant stage and lot of things were to cleared. People. The Eight P’s – Product. The Era of Pre – 1980’s has been deifned as the “Revolution of Services” as stated by Regan (1963). He expressed now the marketing through his traveled a long distance and the concept of services marketing has come into existence.e. process and Physical Evidence and Pace-helping meeting customer standards and Expectation thus enhancing quality of Services nd Brand loyalty. promotion. and responsiveness. characteristics of the staff and responsiveness towards the customers. Credibility. Berry (1985. Johanson’s Dissertation in 1969.
Aggarwal (2000) observed that the customer is the central figure in the relationship marketing as his loyalty can be commanded towards the particular brand of service. A disciplined approach to customer management will help them to: Redefine the interior and construct new interfaces between itself. helps in retention of customers. strategies are to frame in order to avoid the situation. which. A. He expressed the view that this would be possible only if the services provided to the customers are of highest quality. new service processes and new customer value to create loyalty (Insight and Innovation)
9. Chris Lawer (2004) observed that the organizations who identify opportunities for improving customer relationships and who co-ordinate and measure change in all customer impact zones will have a greater chance of success. Vyas (1999) is of the view that customer satisfaction is the core competence tool for long-term relationship and profitability. Seethapathi and Karuna (1999) discussed that only those banks would survive which would give quality services to the customers and believe in the long term relationship management. RESEARCH METHODOLOGY PROJECT TITLE
Importance Of Customer Relationship Marketing In Banking Sector (A Comparative Study Of IDBI. HDFC. BANK and BANK OF PUNJAB In The City Of Patiala)
. Some highly successful companies use already exiting strong relationships to cultivate and strengthen new ones. new relationship opportunities. ICICI.Stewart (1998) suggested that as the customer relationship marketing or management is given more stress in the recent past but much emphasis is required on why customers exit? Policies. its customer and partners (orientation and interface) • Identify new markets.Purushothaman (2002) concluded that relationship building leads to customer loyalty. in turn.
the secondary data was collected from the District Credit Planner 2002 – 2003 published by the Punjab National Bank.
1. the lead bank. CHATPER This chapter review of literature. III CHAPTER This chapter deals with research methodology covering statement of the IV problem. CHAPTER This chapter covers the findings and conclusion drawn from the study and VI various recommendations and suggestions given.
To study the profile of banking in Patiala. Bank and Bank OF II Punjab . CHAPTER This chapter covers analysis and interpretation of the data collected through V questionnaires. To study the profile of banks and to carry out its swot analysis the secondary data was collected from internet. objectives of the study. 2. and limitations of the study and research methodology. magazines and information brochures of the banks. ICICI. IDBI.
i.SCHEME OF THE STUDY
CHAPTER I It is the introductory chapter relating to the introduction to the CRM and need. Patiala.
DATA COLLECTION METHOD
The present study is based on both primary and secondary data sources. scheme.
. newspapers. CHAPTER This chapter deals with profiles of HDFC.
This answers : how the sample should be contacted? It can be done through personal interview.
This answers: what number is to be surveyed? It is difficult rather impossible to survey each and every unit of the population due to certain constraints like time and cost. IDBI Bank and Bank Of Punjab were taken up as sampling unit. It can be used to obtain many different kinds of information in many different sitiations. SAMPLING PLAN In sampling plan three decisions are to be taken :
I. the primary data was collected through a structured questionnaire having both close ended and open ended questions.
. The major advantage of survey research is its flexibility. personal interviewing method i. In this case the customers of HDFC.
This answers: who is to be surveyed? That is among the total population who forms the population for the purpose of research.To study the customer satisfaction level regarding the four banks. Its purpose is to collect specific data concerning the market that cannot be enumerated from the company’s internal records. ICICI.
Convenience Stamping Technique
IV. This is the most widely used method for primary data collection. Here the sample size taken is 100 in total. collecting the information by personally interviewing the respondents and filling the information in the questionnaire.e. RESEARCH APPROACH : Market survey method of data collection by administering the structured questionnaire was found suitable.
II. telephone calls etc. The samples are drawn to be surveyed. Survey approach is best suited for gathering descriptive information. For this purpose.
of respondents of a bank Wn = Weight assigned to an attribute r = Weighted average LIMITATIONS OF THE STUDY The project may suffer form certain limitations which are as follow: The findings of the study are based in the subjective opinion of the respondents. yet because of risk of ambiguities and misinterpretations on the part of respondents. The formula used for weighted average method is as follow: Fn = No.
a. Although every effort has been made to include respondents belonging to various socio-economic backgrounds even then the sample (due to its small size) may not be truly representative of the universe. The finding of the survey are based on the opinion of respondents and there is no way of assessing the truth of the statements. b. d. of attributes (factors) x = Total no.
. some element of in accuracy might have crept in. of respondents of an attribute in a specific bank t = No.DATA ANALYSIS The collected data was tabulated and analysed using the simple statistical tools like percentages and weighted average method. Area of study was Patiala and finding may not hold true for large cross section of population. c. All though utmost care was taken to get the accurate results.
occupation . The respondents were to answer in all 9 questions. ICICI Bank. IDBI Bank and Bank of Punjab . In all 100 questionnaries were analysed . Each question was analysed on the basis of relevant technique and interpreted as under: RESPONDENT PROFILE Respondents gave brief information about their age . This information was collected so as to give respondents profile with respect to this study. depending upon the demografic characteristics . These results are helpful both for the user and fir the organisation for which the researcher is conducted . The respondents who were interviewed are the existing customers of HDFC Bank. monthly income and their background . depending upon the demografic characteristics. The result from the qutionnairre are analysed by applying various tests like percentages. Entire sample coverd respondents belonging to different categories .10.
DATA ANALYSIS AND INTERPRETATION
It is the important aspect of the entire market research.
1. and interpretation is made on the basis of data analysed .
100 respondents forming sample were categorized in the following age group: Table 1: Age wise distribution of respondents
. education . The respondents belonging to different categories.+weighted average etc.
Of respondents (% age) 43 35 22
Table 1 reveals the maximum % age of respondents i.e. 43% were salaried followed by 25% belonging to business class. 43% were in the age group of 20-30 years followed by 35% in 30-40 years and 22% in the age group of 40-50 years. Of Respondents (%age) 15 43 25 17
Table 2 reveals the most of the respondents i. Table 2: Occupation wise distribution of Respondents Occupation Student Salaried Businessman Professional No.
.Age Group 20-30 30-40 40-50 or above
No. 17% professional and 15% were students.
2) Occupation Occupations of respondents were categorized into four groups.e.
Of respondents (%age) 10 51 39
Table 3 reveals the maximum number of respondents 51% were graduates. 15000-25000 group and 8% in income Rs. of respondents (% age) 69 23 8
Table 4 reveals that 69% of respondents belong to the income group of Rs. 10000-15000 followed by 23% in Rs. followed by 39% as post graduates and 10% undergraduates. FINDINGS OF THE STUDY
.) 10000-15000 15000-25000 25000 and above No.
4) Monthly Family Income Table 4: Income wise distribution of Respondents Monthly Income (Rs. Table 3: Qualification wise distribution of respondents Qualification Undergraduate Graduate Postgraduate No. 25000 and above group.Respondents were segmented into three groups on the basis of qualifications.
Of customers in various Banks Banks HDFC ICICI IDBI PNB No.Table 5: No.of Respondents 25 25 20 30 Percentage 25% 25% 20% 30%
Table6: Length of relation (%age)
Year Bank HDFC ICICI IDBI
Less than 1Year 28 20 30
Between 1-2 Years 28 40 70
Between 2-3 Years 32 24 0
Between 3-4 Years 12 16 0
More than 4 years 0 0 0
so most of its customers are 1-2 years old.3 100 26. Loans and credit cards are fairly accessed by the respondents.
Table 7: Service Accessed by Respondent (%age) Services Deposits Loans Credit cards ATM Net Banking Tele Banking HDFC% 100 60 44 100 40 36 ICICI% 100 52 36 100 28 24 IDBI% 100 40 20 100 25 20 PNB% 100 40 33.PNB
Table 6 reveals that most of the respondents for HDFC bank are sustaining their relations for more than 2 years but less than 4 years. As IDBI bank has been recently opened its branch in Patiala. For ICICI bank the length is more favorable towards 1-2 years and 2-3 years.67 23. Net Banking and Tele banking are also showing good levels of awareness but still in their infancy stage. PNB have customers almost equally distributed over times with more concentration on 1-2 years.3
The above table shows that all the respondents from the sample of all the four banks are accessing the deposits from the deposits and ATM.
08 3.96 ICICI 3.36 3.75 PNB 3. It is giving tough competition in almost all factors to HDFC bank and in ahead in some.
.56 3.90 3.36 3.83 3.40 3.23 3.05 3.53 3.00 2. HDFC bank needs to improve on networking. PNB needs to improve on client servicing.72 3.50 3.84 3.56 3.96
Table 8 and figure 4 has been clearly showing information relating to rating given to various services provided by banks.60 3.64 3. It clearly indicates that ICICI is doing the best as compared to other three banks if all the factors are taken in a composite but still there is scope of improvement in Teller operations and ATM transactions.72 3. Rest all other factors are on a back seat as compared to other banks.75 3.16 3.76 3. But people are more satisfied with other factors as far as PNB is concerned. The main factor influencing the decision of respondents regarding the choice of IDBI Bank was its return on investment. Teller operations and security.44 3.92 3.16 3.48 3.36 3.60 3. People are satisfied with other factors as far HDFC bank is concerned.55 3.26 3.30 3.24 3.Table 8: Rating of the services (weighted Average) Factors Employee Attitude Wide Range Of Products Security Client Servicing Teller operations Infrastructure Facilities Network Location Returns on Investment ATM Transactions HDFC 3.76 3.63 3. client servicing. Teller operations and ATM Transactions.25 3.76 3.32 3.88 IDBI 3. employee attitude and Teller operations.
Table 9: General Environment Of The Banks (weighted Average) Factors Convenient Working Hours Proper decorum Proper parking facility No over crowding Proper guidance Documents at proper place Proper sitting arrangements HDFC 3.3 CBOP 4 3.7
According to table 9.76 3.52 3.56 2.92 3.7 3.96 3.48 IDBI 3.6 3. it seems that respondents are not happy with the overcrowding during working hours in HDFC Bank.64 3.64 3.65 2.45 3.35 3.52 3. Also many were of the opinion that there needs
.1 3.08 2.25 2.56 ICICI 3.55 3.95 3.84 2.43 3.8 3.03 3.68 3.
Table 11: Total time taken for transactions of ICICI Bank (%age) Attribute Less than 5 5-10 min. the results reveal that the bank has timely completion of transactions and generally complete the transactions with (5-20) min. 48 44 40 40 52 More than 20 16 8 8 12 8
From Table 10. Here also the process of issue/renewal of F. 10-20 min. Improvement in parking facility required.to be improvement in proper sitting arrangements and decorum. IDBI needs to improve on all factors. Receipt of cash and opening
. 20 44 48 44 40 10-20 min. ICICI Bank is also facing similar kind of problems.Ds. time range which is quite quick and satisfactory but 12% people going for more than 20 minutes in issue/renewal of FDs as well as 16% going for opening an account means that there needs to be close monitoring of these two aspects. and more Open an account 8 16 60 16 Receipt of cash 12 28 44 16 Payment of cash 8 32 44 12 Issue/renewal of FDs 4 32 40 24 Overall services at front desk 0 32 56 12
Table 11 shows that ICICI Bank is able to complete most of its transactions in 5 to 20 minutes. Table 10: Total time taken for transactions of HDFC Bank (% age) Attribute Open an account Receipt of cash Payment of cash Issue/renewal of FDs Overall services at front desk Less than 5 16 4 4 4 0 5-10 min. 20 min. PNB should provide proper guidance and parking facility to the customers.
10-20 min.67 7 56 30 Receipt of cash 0 47 47 7 Payment of cash 7 39 40 13 Issue/renewal of FDs 7 33 43 16 Overall services at front desk 0 32 37 30
. 10-20 min. which is not quick and satisfactory.of an account needs to be quicken up.
Table 13: Total time taken for transaction of PNB (%age) Attribute Less than 5 5-10 min.Ds Overall services at front desk Less than 5 5-10 min. 20 min.. and more Open an account 6.
Table 12: Total time taken for transactions of IDBI Bank (%age) Attribute Open an account Receipt of cash Payment of cash Issue/renewalof F. 20 min and more 0 0 25 75 0 35 45 20 0 35 45 20 0 15 50 35 0 20 45 35
The results reveal that the bank has not timely completion of transactions and generally complete the transactions using more than 10 minutes and in some cases even more than 20 min.
Table 14: Response regarding the problems (%age) Problems Yes No HDFC 65 35 ICICI 30 70 IDBI 53 47 PNB 55 45
Table 14 shows that people are having less problems in HDFC Bank. time frame except IDBI Bank.The results reveal that the bank has timely completion of transactions and generally complete the transactions within (5-20) min. Overall services at front desk and opening of account needs to be quickened up. Few are facing problems in ICICI bank and CBOP but a majority of them are facing some kind of problem in IDBI bank. From above tables it is clear that all the banks seem to be able to complete most of transactions within (5-20) min. time range which is quite quick and satisfactory.
Table 15: Problems as faced by the respondents Problems Limited Products Time consuming Procedure Poor Personalized Banking Limited Network Complicated Documentation HDFC 0 8 5 3 4 ICICI 0 5 3 1 2 IDBI 3 9 10 9 8 PNB 5 11 8 7 7
. HDFC Bank has been most successful in completing most of the tasks in 5-10 minutes with ICICI bank and PNB closely following it.
rest all aspects are proving to be problems for respondents. In PNB more people were concerned about the time consuming procedure and personalized banking.In HDFC bank more people were concerned about the time consuming procedure but ICICI bank customers would love to see the personalized banking and network improve. The respondents rate ICICI BANK and PNB equally55 while IDBI bank is far behind of all the banks. In IDBI except limited products.
Table 17: Suggestions given by Respondents (%age)
Suggestions/ Complaints Yes
Table 16: Percentage of Respondents going for each scale for banks (%age)
Rating Excellent HDFC 10 ICICI 8 IDBI 3 PNB 4
Very Good Good Average Poor
20 40 15 15
25 30 24 13
10 32 30 25
15 37 30 14
Table shows that the respondents rate HDFC BANK highest.
• 100% respondents from all the four banks are availing the facility of Deposits and ATM. But people were conceived that their complaints were rectified within a week or month in HDFC bank but respondents in IDBI bank were of the opinion that it sometimes takes more than a month. so 70% respondents are customers between 1-2 years. Client Servicing. or are never rectified . • The two most important factors considered by the respondents of all the banks as important for CRM are timely and quick service and cooperation and behavior of staff followed by others.No
From the above table it seems that more people are ready to give suggestions or complaints to HDFC bank and ICICI bank as compared to PNB and IDBI bank.ICICI bank and PNB respondents were saying that their complaints get rectified within a month.
11. Client Servicing is concerned. • HDFC Bank needs to improve on Teller Operations. Net banking and tele banking are not so much accessed by the respondents. ICICI (52%). For ICICI Bank opened its branch in Patiala in 2002 . • ICICI is doing good too as far as ATM transactions. • 60% of the respondents for HDFC bank have 1-3 years old relations and 28% are having less than 1 year old relation with the bank.
The entire study conducting regarding IMPORTANCE OF RELATIONSHIP MARKETING IN BANKING SECTOR reveals the following findings:
The result show that HDFC bank has been the o overall winner in customer Relationship Marketing with ICICI and PNB second in the list and IDBI closely following it. Loans are also fairly accessed by the respondents HDFC (60%). Employee Attitude . ATM transactions. But people are more than satisfied with factors like Employee Attitude.IDBI(40%) and PNB (40%).
those respondents who have not given any complaint/ suggestion are of the view that services of the bank are up to mark. • In all the four banks. • HDFC came out as winner in parking facilities and proper placing of documents over the other banks. 15% from IDBI bank and 16% from PNB have given the complaints/suggestion. Employee Attitude and Teller Operations. and TELLER Operations. • PNB needs to improve on client servicing. • PNB also scores over the other banks in maintaining proper decorum during working hours and proper sitting arrangements. But people are more than satisfied with others factors as far as PNB is concerned. • All the banks seems to be able to complete most of the transactions within (5-20) min time frame except IDBI bank. Rest all other factors are on a back seat as compared to other banks.The main factor influencing the decision of respondents regarding the choice of IDBI bank was its return on investment. • HDFC Bank is ahead in rating by customers with ICICI Bank and PNB closely following it but IDBI Bank far behind. • Respondents for IDBI bank were having most problems with their bank as 55% answered in affirmative that they have some kind of problems. But respondents were also satisfied with the working hours of HDFC and icici Bank. • Those having problems were mostly concerned about limited network for ICICI bank & poor personalized bank in case of IDBI Bank.
1 Bank should improve their service and leap ahead in customer relationship marketing by maintaining separate database for high valued customers. It is giving tough competition in almost all factors to HDFC bank and in ahead in some.
12. • But there seems to be a difference in implementation part as most of the respondents is implemented within a month but for IDBI it takes more than a month or never implemented. The number was far less for HDFC (32%) and PNB(43%). • There is a problem of overcrowding both in HDFC and IDBI bank but PNB and ICICI bank have been able to prevent this problem. Maintain a
. • The Working Hours of PNB were found to be most convenient as the bank have increased banking hours uptil 8 in late evening .24% from ICICI . • All the three banks are having the provision of complaints / suggestion box and 24% respondents from HDFC .
” The only profit center is are going beyond customer satisfaction to customer delight because customer satisfaction is
. Therefore. The public does not know what is possible what we do. 4. To improve upon relationship . The bankers should do proper planning for relationship marketing. Finance and various other purposes which distract them from real objective of CRM. 2. They should go in for continual contact with customers. They are being utilized for marketing . They should contact their high value customers from time to time and also send updates about latest development in their banks. All banks are not actually making an attempt to measure the effectiveness of CRM.comprehensive and exhaustive database indicates as to how banks can use this information to tap the customers and retain the customers. does not keep the company ahead of its competitors An essential requirement for companies is to develop and retain the future industry share . Although all banks have a relationship manager but objectives and role of managers ins not clearly defined. Banks should hold a CRM training workshop with customer facing employees to develop and instill a new attitude to creativity and innovation. banks should go in for continual contract with customers.
In the prevailing market scenario.
13. to quote Peter Drucker. competing for what has already arrived in common place. Leadership will be to develop capabilities for identifying customers unarticulated needs and design products they want. with the multiplicity of options available to a customer today. 6. Bank do not contact their customers very often. The bankers who do not perceive a difference in conventional and relationship marketing should try to change their point of view of they want to survive through cu throat competition from other bank 5. The tools for measuring effectiveness are not widely used.
limited to meeting the minimum requirements. ICICI.iba. The companies/ banks need to develop value oriented marketing to develop satisfaction value proposition and a value delivery system as the customer would not be satisfied merely by being loved but would also like to feel the comfort and warmth of that love./Banks-CRM-ARC/ www.org.
www. Wherein the organizations are trying to have conversations to their customers and thus give an individualized dealing to their customers which in turn would help them to create relationship bond.
14..wikipedia./Towards-a-successful-CRM-implementation-in-banksan-integrated-model.se/essay/75f3d73165/ www.html o www.. the communication process has become more speedy and thus the organizations and their customers are being brought into a very close atmosphere. Where there is no limit to give them something better than that .. PNB are close competitors of each other and are very well aware of the fact that in today’s competitive world customer is the ultimate king .essays. IDBI.com/Software/Core-Banking.faqs.in/ibahenley.asp o http://en. All the four banks HDFC.org/.org/wiki/Customer_relationship_management o www.com
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. So the overall business has been shifted from making sales of the short horizon to that of building long lasting relationship with the customer.There are difference in certain aspects but on the whole HDFC is leading in CRM by a very small margin. Further advancement in technology section particularly in information technology sector.”It is useless to tell a river to stop running.” To conclude it can be firmly said that there has not been a lot of difference between the application of customer Relationship Marketing for all the four banks. the best thing is to learn the direction it is flowing. In crux ..hdfcbank.temenos.
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.icicibank.com www.pnbindia.com/ www.idbi.