Developing competitive advantage through CRM

A Morrison’s case study

Based on the information give in the case study, answer the following questions: 10 marks each
question, 30 Marks.

Question 1: Explain in detail how did Morrison’s develop a strong customer relationship
system? What competitive advantage did Morrison’s have on its competitors?

Answer: Morrison Company developed a strong relationship with customers, differentiating

themselves from the competition and providing good customer services. To provide the best
customer service, a company must know what its customers expect and therefore meet these
expectations. Customer satisfaction is paramount to keeping customers happy and loyal to the
business. It can often be much more profitable to retain customers than to attract new ones.
Morrison achieves this by offering products and services, through Market Street, which are not
offered by its competitors, thus maximizing customer loyalty. High-quality customer service is a
key way in which one company can differentiate itself from another. Morrison's customer service
strategy is simple: to provide the best customer service by developing the most prepared and
motivated colleagues in an environment where the major major supermarkets compete for market
share. Morrison also have some special people which includes butcher and fishmongers to deal
their customer issues and also try to provide correct information to their customers. Among the
large supermarkets, several features make Morrison stand out and distinguish it from its
competitors. By promoting their "new approach" and their commitment to sustainability,
customers become aware of the freshness of their food and their concern for the environment.
Fresh produce is purchased locally whenever possible and then processed at the Morrison
manufacturing facility. The fresh produce was delivered to its temperature controlled packaging
warehouses and plants in the UK and abroad. The products are carefully transported to stores
across the country. This is how they created an image in the customers' mind that their products
are safe and sound. Its employees were more skilled, hiring butchers, fishmongers and special
bakers than any other supermarket in the UK. In 2010, they also employed over 131,000 people,
serving 11 million customers a week. They also created career opportunities and progress.
Morrison won the Employer of the Year award at the 2011 Grocer Gold Awards. This
demonstrates his focus on colleagues and his ability to provide fresh produce and exceptional
customer service. In addition, by creating high levels of customer satisfaction, Morrison creates a
significant competitive advantage.
Question 2: Based on the discussion in chapter 5, highlight the nature of relationship which
Morrison’s was trying to develop with its customers. How did they do it? Identify if Morrison’s
succeeded in forecasting the CLV of their customers.

Answer: The nature of the relationship used by Morrison was the "facilitation relationship", they
create trust and cooperation between buyers and sellers and create value for both sides. It is used
to develop stronger, long-term customer relationships and to maintain an excellent customer
following. For example, Morrison is a well-known name and has a competitive advantage in the
market. They have loyal customers and know how to retain them because of their CRM and their
structures. They have good relationships with customers and only buy their products, design an
appropriate program, train their employees and hire specialized staff. The training and
development programs have been designed for employees so that they can do their job well,
since they take care of the customers. There were also loyalty programs designed for customers.
The "Morrison Miles" card was provided to customers when making repeat purchases. This card
rewards normal fuel users who get petrol from the filling station and accumulate points with the
vouchers to spend in the shop. The customer obtains the facilities and customer service from the
company and, in return, contributes to the company's market share by purchasing its products
from its competitors.

CLV is establishing and maintaining mutually beneficial long-term relationships with profitable
customers. Companies that follow the CRM strategy work to provide different levels of service
to customers based on their expected life value. They keep a record of customers who are loyal,
occasional buyers or changers. This helps in data mining, either to acquire or retain those
customers. This also helped Morrison to predict. They knew how to retain customers and how to
acquire new customers, used relationship facilitation techniques and built trust with customers.
They build a constant interaction of the sales force with customers, the weekly contact keeps in
contact with customers through Telemarketing / Direct Mail and provides them with the best
value for the customer, with consequent identification of the CLV of the customers and customer
visits they increased from 10.5 to 11 million per week and managed to do so.

Question 3: How did the CRM program at Morrison’s maximized customer benefits and
minimized customer risk? Explain in detail with examples.

Answer: They have designed a CRM program and maximized customer benefits. There are
FIVE important components that use: Information that includes information provided directly to
customers by colleagues and details provided in published material such as websites, packaging,
catalogs and brochures. In-store, product directions and directions allow customers to navigate
the store more effectively. For example, when a new customer visits the store, they are impressed
with these measures and it becomes very easy for the customer to shop when he knows where the
products are located and the appropriate directions guide them. So there is specialized attention
that several butchers and specialized fishmongers have that advise customers on the best meat
and fish. For example, if there is a new customer who has come for the first time and wishes to
buy meat, the special butcher will guide and explain. Enhance your experience as you
communicate with suppliers and how they have been treated better. After-sales services play an
important role, since they cover all areas of customer involvement once the sale is made.
Includes packaging, guarantees, complaints, refunds and exchanges. At Morrison, the helpful and
friendly colleagues offer an exceptional payment experience to help build customer loyalty. For
example, if a customer wants to change a product and wants to return it, how well he treats and
guides it. Here's how simple it is to retain customers. If they don't feel good about the product or
the product is defective, how do you tactically manage this problem and solve the problem.
Personal service in-store butchers, bakers, and fishmongers provide the customers with an option
of customizable product that can better cater to their needs. This helps in creating an
environment where customer can get whatever they desire. Since other competitive companies
do not provide this service, this also helps in customer retention which provides them benefit.
Convenience, this includes store locations, ease of access and parking for cars, availability of
public transportation and convenient forms of payment, such as cash, cards and chip and pin
facilities. At Morrison, 5% of all car parks are dedicated to blue badge holders to improve
accessibility for people with recognized disabilities. It makes it easier for disabled people to visit
Morrison and also attracts customers. Knowing what customers expect and meeting their
expectations plays a vital role in maintaining good relationships with them. Morrison focuses on
customer service through an initiative called "HOT" which means "Hi, offer, thank you". The
goal of "HOT" is to bring Morrison's colleagues and customers closer to their primary goal of:
"Establishing rewarding experiences that create an emotional relationship between the customer
and the store." This ties the customer to that particular brand and they become loyal customers.