What is Customer Relationship management?
Customer relationship management is creating a team relationship among sales, marketing, and customer support activities within an organization. Another narrow, yet relevant, viewpoint is to consider CRM only as customer retention in which a variety of after marketing tactics is used for customer bonding or staying in touch after the sale is made. Shani and Chalasani define relationship marketing as “an integrated effort to identify, maintain, and build up a network with individual consumers and to continuously strengthen the network for mutual benefit of both sides, through interactive, individualized and value-added contacts over a period of time”. The core theme of all CRM and relationship marketing perspectives is its focus on co-operative and collaborative relationships between the firm and its customers, and/or other marketing factors. CRM is based on the premise that, by having a better understanding of the customers’ needs and desires we can keep them longer and sell more to them. Growth Strategies International (GSI) performed a statistical analysis of Customer satisfaction data encompassing the findings of over 20,000 customer surveys conducted in 40 countries by Info quest. The conclusions of the study were: • A Totally Satisfied Customer contributes 2.6 times more revenue to a company as a Somewhat Satisfied Customer. • A Totally Satisfied Customer contributes 17 times as much revenue as a Somewhat Dissatisfied Customer. • A Totally Dissatisfied customer decreases revenue at a rate equal to 1.8 times what a Totally Satisfied Customer contributes to a business. • By reducing customer defection (by as little as 5%) will result in increase in profits by 25% to 85% depending from industry to industry.
the purpose of CRM is to improve marketing productivity. the objective of a company is not to really prune its customer base but to identify appropriate customer programs and methods that would be profitable and create value for the firm and the customer. The company must therefore be selective and tailor its program and marketing efforts by segmenting and selecting appropriate customers for individual marketing programs. In CRM. CRM is defined as: Customer Relationship management is a comprehensive strategy and process of acquiring.
. These lead to superior value creation. Two important processes for CRM include proactive customer business development and building partnering relationship with most important customers. Hence. However. retaining and partnering with selective customers to create superior value for the company and the customer. Marketing productivity is achieved by increasing marketing efficiency and by enhancing marketing effectiveness. As several research studies have shown not all customers are equally profitable (Infact in some cases 80% of the sales come through 20% of the customers). he is a part of the organization. it could even lead to “outsourcing of some customers” so that a company better utilize its resources on those customers it can serve better and create mutual value. In some cases. The basic concept is that the customer is not someone outside the organization.An important facet of CRM is “customer selectivity”. marketing efficiency is achieved because cooperative and collaborative processes help in reducing transaction costs and overall development costs for the company. As is implicit in the above definition.
Preferences and Personalities . recognize and reward best customers disproportionately. Thus the single adults shall require a new car stereo and as he grows into a married couple his needs grow into appliances. What CRM needs to understand while differentiating customers is? .Key CRM principles
Differentiate Customers: All customers are not equal.Sensitivities. By identifying life stage and life event trigger points by customer. • Maximizing Life time value
Exploit up-selling and cross-selling potential.
. Understanding each customer becomes particularly important.Physical and psychological characteristics • Differentiating Offerings
→ Low value customer requiring high value customer offerings → Low value customer with potential to become high value in near future → High value customer requiring high value service → High value customer requiring low value service • Keeping Existing Customers Grading customers from very satisfied to very disappoint should help the organization in improving its customer satisfaction levels and scores. marketers can maximize share of purchase potential. And the same customers’ reaction to a cellular company operator may be quite different as compared to a car dealer. Tastes. Besides for the same product or the service not all customers can be treated alike and CRM needs to differentiate between a high value customer and a low value customer. As the satisfaction level for each customer improve so shall the customer retention with the organization.Culture Background and education .Lifestyle and age .
So banks had a windfall doing almost nothing. it is imperative that Indian banks wake up to this reality and re-focus on their core asset — the customer. when the banking sector was opened up.
. A greater focus on Customer Relationship Management (CRM) is the only way the banking industry can protect its market share and boost growth. These banks ruled the roost. It has to innovate and meet the very needs of its clients/ customers so that they remain as advocates on the loyalty curve.•
Loyal customers are more profitable. The mesh of rules that propped up the Indian banking industry is now being dismantled rapidly. simply because they had customers. Referral sales invariably are low cost high margin sales. like manna from heaven. Any company will like its mind share status to improve from being a suspect to being an advocate. they survived by adapting quickly to the new rules of the game. grow and acquire. The bond profits.
CRM in Banks
For long. As one of the most attractive emerging market destinations. improved the balance-sheets of all banks irrespective of their core performance. the era of lazy banking is soon to end. India will have a competitive banking market after 2009. Ironically. India will see foreign banks come in. pushed up the prices of bonds. And to their credit. protected by regulations that did not allow free entry into the sector. Company has to invest in terms of its product and service offerings to its customers. Therefore. what with more freedom to come in. However. the Reserve Bank of India's moves to cut aggressively the interest rates after 1999. Indian banks had presumed that their operations were customer-centric. For them an unexpected bonanza came from government bonds in which most were hugely invested. According to a RBI road-map. Many managed to post profits.
CRM would also make Indian bankers realise that the purpose of their business is to "create and keep a customer" and to "view the entire business process as consisting of a tightly integrated effort to discover. and processes. in turn. A successful CRM strategy aims at understanding the needs of the customer and integrating them with the organisation's strategy.
. each providing its own spin on the idea. it requires a well-thought-out initiative involving strategy." What is CRM. as there is no single definition for it. CRM is a simple philosophy that places the customer at the heart of a business organisation's processes. or even a new method of data collection. Above all. It does not happen simply by buying the software and installing it. CRM is variously misunderstood as a fancy sales strategy. It is none of these. activities and culture to improve his satisfaction of service and. While this may sound quite straightforward. technology and business process. one of the best ways of launching a CRM initiative is to start with what the organisation is doing now and working out what should be done to improve its interface with its customers. it requires the realisation that the CRM philosophy of doing business should be adopted incrementally with an iterative approach to learn at every stage of development. for large organisations it can be a mammoth task unless a gradual step-by-step process is adopted. For CRM to be truly effective. an expensive software product. probably. people. Then and only then. CRM has also become a misnomer for a range of solutions from IT vendors. maximise the profits for the organisation. and what will it deliver to the banks? CRM is. Only time will tell how Indian banks embrace the CRM philosophy and take on the competition from foreign entities. Unfortunately. one of the least clearly defined business acronyms. Therefore. and satisfy customer needs. It is probably easier to say what CRM is not. create. should it link to an IT solution. people. technology.
National Insurance Company Ltd. The New India Assurance Company.74 crore with the public holding (other than promoters) at 57.. The Oriental Insurance Corporation and United Insurance Company Ltd. The Bank's Registered Office is at Ahmedabad and its Central Office is located at Mumbai. Integrity and People
Mission And Values
• • • •
Customer Service and Product Innovation tuned to diverse needs of individual and corporate clientele. the Bank has a very wide network of more than 572 branch offices and Extension Counters. The Bank today is capitalized to the extent of Rs. after the Government of India allowed new private banks to be established. Efficiency and effectiveness built on ethical practices. Life Insurance Corporation of India (LIC) and General Insurance Corporation Ltd. it enhances your face value" is a service quality stressed on o Periodic Customer Service Audits Maximisation of Stakeholder value Success through Teamwork.I). Progressive globalization and achieving international standards. This is one of the largest ATM networks in the country. The Bank has a network of over 2468 ATMs providing 24 hrs a day banking convenience to its customers.
Customer Satisfaction through o Providing quality service effectively and efficiently o "Smile. Continuous technology upgradation while maintaining human values. and other four PSU companies.About Axis Bank
Axis Bank was the first of the new private banks to have begun operations in 1994. The Bank has strengths in both retail and corporate banking and is committed to adopting the best industry practices internationally in order to achieve excellence. i.e.26%. 355. Presently. The Bank was promoted jointly by the Administrator of the specified undertaking of the Unit Trust of India (UTI .
The CRM enabled companies include Modi Xerox. Founding members include Tata Telecom. founded with the purpose of assessing and improving CRM practices. among others. With is vast talent pool. Global Groupware. This trend is likely to increase in the future. Tata Telecom. AC Nielsen. With the easing of infrastructure constraints.Planet M. India is likely to emerge as a significant player in this segment.
. Satyam Infoway. TVS Electronics. catering primarily to the American and European markets are coming up in and around the metros. and EpicenterTechnologies among many others.Conclusion
Software is to India what oil was to Gulf. Modi Xerox. It is therefore no surprise that the Indian companies are jumping into the CRM bandwagon to seize a chunk of the global market. Carrier Refrigeration. and Motorola India. Tata Infotech. Adoption of CRM by Indian companies is at an infancy stage. India is fast becoming an important development base of major CRM companies. Tata Teleservices. India even has a CRM Foundation in New Delhi. both products as well as services. Call centres. Escotel. HP India. Carrierr Airrcon.