CUSTOMER RELATIONSHIP MANAGEMENT (CRM) BBO For VI" Semester B.B.A Courses ‘TShanmugapriya, 8S, MBA (PHD), ‘Assistant Profeso, Sri Muthukumacon insttute of Technology, ‘Chenna “TLChandrasekar, BE, MBA, (PHO), ‘Asstant Professo, \Velemal Insitute of Technology, ‘Chennai ARS PUBLICATIONS No.1, Veerabathra Nagar, Pa I ‘th Street, Medavakkam, ‘Chennai - 600 100, Tamilnadu, India Phone: 044-65397467, Mobile: 9840025186 ‘mal: arspublicationsigmall om (UNIVERSITY OF MADRAS SvELATUS) (CUSTOMER RELATIONSHIP MANAGEMENT UNIT Communication need/ Mode of communication = bariers, channels of communication - oral - written - [tering kil - Verbal skl- interpersonal eommonication tnd intra personal communication, Essentials of business Jeter unm CRM - concept and approach - CR in competitive svionment public relation and image building UNIT ut Banker - customer relationship -retaining and ‘enlarging customer base - customer services - quality tice, unriv [Nature and typesof customer -complaitredressal methods Talwar and Goiporia committee report, ‘ustomer service committee, customer day-Copra Forum ombudsman. unm vy Market Segment - Customer Data Base - Market Research. Review and Evaluation of Customer Satisfaction,(CUSTOMER RELATIONSHIP MANAGEMENT(CRM) SHO THE PAGENO. ‘UNIT [= INTRODUCTION TO COMMUNICATION {LA DEFINITIONS OF COMMUNICATION ——————— 2 1. Amadcan Management Association efintion — 2 41.42 Pater Lite dation. 1.13, Newnan and Sure J ition, ———— 4.14, According to Keith Davis deision- 418 Lous A ln dation 12. NEED OF COMMUNICATION: 13 ROLE OF COMMUNICATION IN BUSINESS 14 MODES OF INTERNAL COMMUNICATION. 15 MODES OF EXTERNAL COMMUNICATION. 418, THE COMMUNICATION SITUATION ——————10 17 THE COMMUNICATION PROcEssICvoLE ————11 118 ELEMENTSICHANNELS OF COMMUNICATION —— 12 4184, Sender or vaneiter. 12 4182 Message 12 418. Encodng —2 4184, Conmuricaton channel. 12 418.5. Recover 13 188 Decosing 13 187 Fosdtock 13 128 Bran gain 1.9, FORMS OF ORGANIZATIONAL COMMUNICATION — 14 COMMUNICATION FORMS 15 4.9: INTERNAL COMMUNICATION —————_———16 PBL Forel lemal communication network ———18 419.12. Downward fow 18 18:13. Upward Flow 17 4914 Horzorta ow 17 13:15: intomel ioral conmuncaton ——————17 19 2.EXTERNAL COMMUNICATION ——————18 202.1 Formal external communicaion 18 1922 intomel extemal communicaton ———_—_—19 140. BARIERS & SOLUTIONS OF COMMUNICATION——20 ior Problems win sender. 2 a. 433. 6 15. 11151. Vera Communicaton 118. war 1, 19 120, 121 122, BUSI aplioeapeie epee eee era aes Le enon —_———8 Reece na BUSRESS Saeco eee Sr cROSSCUTURALZE See ea Sees ce eh senior ont met eau 8 1812 Ropero cermeneren ————a 114 Soca comma —— 1.18.1.4, Public Communication. Scenic an 1.15.2. Nonverbal Communication —— ow 1.15.3. Written Communication eine 1.15.4, Visual Communication “I DIFFERENCE BETWEEN: 2 on VERBAL 7 DIFFERENT WAYS OF Daren COMMUNICATING 3 Romine 1173 at coum ROS 8 cong nN WRITES roms 48 Letog MUNICATION 3 118, 2 ts 1. notes 449. 8. Faxse_——_—————————_* ———— 119. 6. Ee =4.222 Parts ofthe Lote 42 1223 Your sccress 42 1224. Date 42 1225 Insc Address. 42 1228. The Greeting 42 1227. The inaductry Paragraph ‘3 1228. The Boay: 43 3228. Tre Chosing 43 122.10, The Presentation of he Leter 44 4.22. LETTER WRITING TIPS. 45 121 Business eter wrtng tps—————8 4222 Business Later virang- 46 423, ESSENTIALS OF ABUSINESS LETTER, 48 124, ELEMENTS OF AGOOD LETTER 48 4.25. BUSINESS EMAIL WRITING. a NIT INTRODUCTION TO CRM Ty SeuuNe 3 22. THE HISTORY OF RELATIONSHIP MARKETING——53 23. THE EVOLUTION OF RELATIONSHIP MANAGEMENT 5 24, COMPONENTS OF CUSTOMER 58 25. CaM components 59 281. Costones 80 252 Relatonship, ond ————60 253. es 28. BUSINESS CYCLE OF CRM 81 21 Understand and Offerentate 2 26.2 Develop and Customian 63 263 interact and Dalver 3 284 Acaure and Retain 64 27. Waa be goal of CRM? ———_—85 2 y Mow CRM BENEFITS FOR BUSINESS? —————85 28. Why ist imponan 285. bpenencs <9 ‘210. KEY CONCEPTS OF CRM 240:.Comprehansve 3 sre $e 2 io2Acaorng % 03 seeton 20 18 eae onmeion 2 ADT Teeny * ep I PYosakauaty berefeal longterm relaonship——~7; tt, THE VALUE OF IMPLEMENTING IN CRM —————7 1a keys To SUCCESSFUL CRM IMPLANTATION ———71 213. CaM SIGN'FICANCE TO THE STAKEHOLDERS ——7 2. {SSUESIN CRM ANO MULTIPLE STAKEHOLDERS — 7 Eis: CaM aS ASTRATEGIC MARKETING TOOL—————T 216. CRIN COMPETITIVE ENVIRONMENT PuBuG RELATION n 27. THE PERSONAL Touch 77 218. Mass CUSTOMIZATION 77 219: MASS CUSTOMIZATION POTENTIAL 71 2181, ireniaton tough ndvity 77 2:102.New way toc costs —— 7 2183. Lnglesing estomet retention ————78 2194 Mass castomaton athe basis erlang CRM 1% 220. 1 POTENTAL OF LEARNING RELATIONSHIP 2E21, REGUREMENTS FOR SUSTANED CRM Set 222 Poumon crigg swe Suu acusTowEs GROWS 244 MeasUne saisracron with CR 225. CRM BUSINESS STRATEGY Sane, | 2.26. CRM TOOLS ———_ * tee ae 2285 Yabe ceaton op nae SUCCES Wen ——— 2, BHC sity 2081 bee al 2242 Fron teapot nfuencing mage bung ———— os ———93 2.28.3. Elements of image building. 2.28.4, How to bull a truly customer-contic (COMPANY 9 2.285 by bulding image - example. 04 ‘UNIT CUSTOMER RELATIONSHIP MANAGEMENT [CUSTOMER Introduction 7 SOR ——<— << 32. RELATIONSHIP ——— 95 33. CUSTOMER RELATIONSHIP 96 34. RELATIONSHIP MARKETING VS. ‘TRANSACTIONAL MARKETING 96 3.44. Listening to customers 97 3.42. Customer if cycle. 98 3.413. Customer events 98 3.44. Customer demographics ———98 3.45. Industy 98 3.4.8. Monitor customer service: 98 3.47. Improve your Net Promoter Score 98 3.4.8. Customers appreciate 98 35. PETER DRUCKER QUOTES. —— 100 36. TRANSACTIONAL MARKETING VS RELATIONSHIP MARKETING 100 37. BENEFITS OF RELATIONSHIP MARKETING 101 3.8. CUSTOMER RETENTION mm 102 3.8.1. Objectives 102 3.82. Significance —————_—104 3.8.3, Importance of Customer Retention ——————— 105, 39. REASONS FOR CUSTOMER SWITCHING 106, 3.10, STRATEGIES FOR CUSTOMER RETENTION ——— 105, 3.10-1.Find out what customers want and what ‘causes them to stay or leave, 108 3.10.2. Proactively collect and promote ‘customer feedback 3.10.3 Analyze customer feedback to gain valuable insights. — 107 3.10.4.Complaint Management System 108 3.104.1 Visbilty "10g 3.10.4.2 Accessibilty 108 3.10.4.3 Responsiveness 108 an By 319. a. as. aie. 13.1044 Customer focused approach ——__ 31045 Accouriabty —————__ 31048 Continous Improvement" 3105. immediatly adress customers! Conplans and concems.———————_, 108, Managing Customer Wing 3.107, Take acon and Measure te Resuts ———— 310.8. Acvely measure and montor your customers loyal and engagement. £3403, Keep asking, atoning, analyzing ‘and proving, $310.10" Serves rooovar stages ‘310-10 Steps for an elfectve sorvice % ww © a recovery system 0 alu aed strategies i ENLARGING CUSTOMER BASE ————— fi 5312.1 Dovolep a Cusomer-ConticSrateay t 13.122 Greate a Customer Corie Cuture— ‘3123 Hameas the Pomer of (Customer formation an {3.124 Iiograte Technology 11) 3.128 Conduct Coninoous Measurement ‘and imerovemont. m ‘USTOMER LIFE CYCLE- a 3 Cova pase 4132 Aequeon phase 5.133.Reonon race L134 Lopay phase eau padres S14 Eten cm goals 2 5.142 Esse ono dopants a 44143 Goreaneabonse 5 444 Cintomer urs 22 OW To Stay CLOSE TO YOUR CUSTOMER? — 123 RM CENTRIC ROAD Map MER? —— 1S 3181 Comme va rk 18 2Custmer ators aengty 1 3363 Roomap mee 4384. Castor airship aioe wintengttcuse eae a a +8 4a7 318 318. 321 az az a a2 5.16.5 implementation = CUSTOMER ACQUISITION 128, ‘CUSTOMER SERVICE. ies CHARTER TICS OF CUSTOMER SERVICE 430 QUALITY CIRCLE a 320.1 History at 3202. Meaning fe 3.20.3 Formal and Informal Groups: bo 3.20.4 Formal Groups a 3.2055 Informal Groups. re 3.20.6 What is Quality Circle (AG)? 135 3.20.7 Other Names of Quay Circles ————— 138 3.20.8 Objectives of Quality Ciries. 136 3.20.9 Qualty Circle Meetings. 137 13.20.10 What Takes Place During ‘Quality Circle Meetings?” 138 '3.20.11.What Quality Circles are Not? (Misconcopts) 139 3.20.12 Pitfall and Problems 140 ‘Structure of Quality Circles Program ——————— 140, So Basic Elements 140 Roles and Responsiblties of Various Elements —— 141 323.1 Roles of Member. 14 3.23.2 Roles of Leaders ‘41 3.23.3 Roles of Faciitator. — 43 3.23.4 Roles of Steering Commitee ‘(Manegement). ——————————— 144 How Do Quality Circles Operate? Code of Conduct for Cs. Problem Solving Toots and Techniques UNIT v INTRODUCTION TO CUSTOMER TRTROOUCTION TO CUSTOMER ————— 1 OT est 1 eine ire chatacreRIsTICS —— 151 43, 44 45 40. an. 48, 49, 410, 4m, an 422.3 boat carci 42.24 Geographical mr: ~ 4228 bpesal erene:——————— 18, Hoh and involvement bane ————— 15 4631 Deion —— 18 Exmonmbayna posmne ——————— 1 SAC io cn waking gare? —— et 2 Aha tn pul own he bu? —— 1 3 How dwn by ir ‘The pa decilenpocn a 159 How doen py ‘8 ‘wes OF cusTOMER hr ith 482 Dncount Cosomers: 7 483 tnpundve Custoner i 18 4.05 Vanden Cuorers ‘s ROLE OF CUSTOMER ‘* oC —— Gs eee oe 7A Pade 475 User tee FEEDBACK CARDS COMMENT CARDS. a Pega i ite eee | Rote — Pocus noes seienta | ae ‘4402 dewearrs, FACE TO FACE INTERVIEWS. oa At unread 412 0euenrrs. —____— ‘TELEPHONE INTERViEWS ——_— if oat eae ee4.122, DEMERITS: 14413. CUSTOMER COMPLAINTIREDRESSAL 1 process 109 253 MERITS 409 4152 DeNERITS 170 4.14, EMPLOYEE FEEDBAGK 170 4438. Aopteatons for Costner rails —— 170 4.16. SPECIATION ANALYSIS ze 170 4117, CUSTOMERS EXPECTATIONS VS PERCEPTIONS ™ 4.38, FACTORS THAT FLUENCE CUSTOMERS EXPECTATIONS 172 4.18, CUSTOMER BEHAVIOR 12 $10.4 wartetng Stoty ————— 178 ‘4.19.2 Public policy- 7 14493 Sola maratng 7 420. CONSUMER BUYING PROCESS 178 4.20.4 Problem Recognition (awareness of need) —— 178 4202 Information search 179 42033 Evaluation of Alternatives 170 420.4 Purenase decision 180 4205 Purchase. 480 420.6 Post-Purchase Evaluation outcome: ———— 180 421, CUSTOMER LIFE TIME VALUE ———— 180 422. IMPORTANCE AND RELEVANCE OF CLV ———— 181 423, TRADITIONALLY USED METRICS 182 ‘424, REM Method 182 4.24.1 Regency: 182 4242. Frequency: 182 4243 Monetary value! 183 425. SHARE-OF-WALLET (SOW) ———————— 183, 428, PAST CUSTOMER VALUE 184 4.26.1 Revenve por customer 187 428.2 Retention: 17 425.3 Additonal Purchase. 187 4.28.4 Referrals 187 428 5 Costs: ——_______— 187 ‘427, USES AND ADVANTAGES OF CLV —————— 189 427-4, Advantagos of CLV: 109 428, TOOLS FOR CREATING CUSTOMER VALUE 101 (428.1 USER VALUES 19 ‘Vez paver VALUES 182 1 426.3 BUYER VALUES 193 1420, SELECTION OF PROFITABLE CUSTOMER———— 193 ee SO PORIACOMMITTEE REPORT —————— 198 £3, Consumer Service Improvement in Banks, ———— 198 ‘432. IMPORTANT DELIBERATIONS OF TE COMMITTEE: 197. 14.38, RECOMMENDATIONS ————————— 198 432, CUSTOMER SERVICE COMMITTEE —————-— 200 341 VISION ——<— 200 4342 FUNCTIONS OF CUSTOMER "SERVICE COMMITTEE ———————— 200 4.343 ACTION ITEMS 202 4.5, CUSTOMER DAY. 8 435.4. 113——_——______4 4.35.2. WAYS TO BRIGHTEN A (CUSTOMER'S DAY ————_—— 4.36, COPRA FORUM ———_—_—__— 20 1435.1, SAMPLE OF COPRA FORUM (437, OMBUDSMAN —————— 208 371 MEANING 208 4372 PROCEDURE FOR APPOINTMENT (OF OMBUDSMEN. 208 4.7.3 SELECTION OF OMBUDSMEN. 210 4374 REMUNERATION ETC OF OMBUDSMAN — 210 SSrsawaRD 2" ‘4376 DUTIES OF AN OMBUDSMAN ————_——212 437.7 RESPONSIBILITIES OF OMBUDSMEN ——— 212 4.37.8 POWER OF OMBUDSMAN. 218 4379 MANNER IN WHICH COMPLAINT IS "TO BE MADE 4.37.10 RECOMMENDATIONS MADE BY ‘THE OMBUDSMAN a 218 ‘UNIT V MARKET SEGMENTATION 53 MARKET SEGMENTATION 2",82. 53. 54 55. 58. 87. 5a, 5.10, 5m, 52 5.1.4 Ctra for sogmanting —————————~ 218 METHODS FOR SEGMENTING ‘CONSUMER MARKETS: oe ‘52.1 Geographic segmentation ————-————— 522 Behavioral segmentation ———————~ 220 52.3 Segmentation by occasions 220 52.4 Segmentation by benefits 220 ‘UNDERSTANDING MARKET SEGMENTATION —— 221 5.3.1 Behavioral aspect 222 5.32 Organizational aspect. 222 CUSTOMER DATABASE: 223 5.4.1. Definition: 223 CUSTOMER INSIGHT 223 SCHEMA, 223 DATABASE MARKETING. 225 5.7.1 Customer information and databaso 226 6.7.2 What Information to track? 226 3.7.3 How to oganize the information? 226 (CUSTOMER ANALYSIS—— 235 5.8.1 Intomal customers —— 238 5.82 Extemal customers. 238 Knowing vs. Understanding Your Customer: 239 IMPORTANCE TO KNOW ABOUT CUSTOMERS. 244 5.10.1 Why does your customer buy? —————— 5.10.2 How much of the customar's total business — ‘do you have compared with your competitors? — 244 5.10.3 How does your customer see you? ——~ 5.10.4 How dificult sit forthe customer to shit to your competitor? —-— 1510.5 What does the customer expect aller a sale? — 245 CUSTOMER CHARACTERISTICS. a8 5.11.1 Business to consumer: 248 5.112 Business to business: — 5.11.3 Example: — 5.114 High and low involvement benefits {Customer buying process: 1512.1 Whois the decision making person? 5.12.2 At what time or period, dows he buy? 5.12.3 How does he buy?- 251 © 5.12.4 How does he pay?- 28) sia, 0968 OF CUSTOMER NALYSS 2s eS Org WHO your bas cusiomer ie —— 254 $13. Bat out eterton plans or your tow tomers pe 5.13.3 Inducing further buying from your oxing atone, 282 5.13.4 Improving customer service- 282 5.13.5 Effective campaign planning : 253 5.136 eoanng mara sare ) 5137 Inoaing oval rottabiy-——————— 28 5.14 CUSTOMER PERCEPTION io B18, MARKET RESEARCH 288 S48, MARKET RESEARCH FOR BUSNESS NO PLANNING, 238 5184 Martel ormaton a 848.2 Marttsogrenaion 2 $48.9 Mata onde a 5.164 SWOT Anas = 6.17. CUSTOMER SATISFACTION 2 5:17 Oaing customer slsfcion, a 5.172 Evaluation of cuter station, mee TN Fainog Ft cling Fa ple itn Fig : 1.1. Need of communication ROLE OF COMMUNICATION IN BUSINESS: The term customer communication is used for all messages that we send and reccive for official purpose like running a business, managing an organization, conducting the formal affairs of e voluntary organization, relationship between customers and so on. Customer communication is marked by formality jon. The success of any business toa large extent inst personal and social depends on efficient and effective communication. It takes place among business entities, in market and market places, Within organizations and between various. letesuetion to Communication Group of employees, ‘Owners and employees, Buyers and sellers, Service providers Customers, Sales persons rosptets ‘Also between people within the organization and ‘The press persons. e00000000 All such communication impacts business. Done with ‘are, such communication can promote business interests, ‘Otherwise, it will portray the organization in poor light and ‘may adversely affect the business interest. Communication 's the life blood of any organization and its main purpose is ‘effect change o influence action. In any organization the main problem is of maintaining effective communication Drocess. The management problem generally results in poor ‘communication, Serious mistakes are made because orders fare misunderstood, The basic problem in communication is ‘thatthe meaning which is actually understood may not be ‘what the other intended to send. It must be realized that the speaker andthe listener are two separate individuals having {heir own limitations and numberof things may happen to distor the message that pass between them. When people (Customer Relaorshio Management * Within the organization communicate with each othr, i is {internal communication. They do so to work as a team and tealise the common goals. It could be offical or unofficial ‘MODES OF INTERNAL COMMUNICATION: Include face-to-face and written communication. + Memos, + Repons, + Office order, + Circular, fax, + Video conferencing, + Meeting ete ‘communication are the examples of internal MODES OF EXTERNAL COMMUNICATION When people in the organization communicate with anyone outside the organization itis called external ‘communication. These people may be Y Clients or customers, Y Dealers or distributors, Y Media, goverment,10 Invoduetion fo Communication Y General public ete communication. are the examples of extemal 7 Communication isthe life blood of the business. No business can develop in the absence of effective Communication s the mortar that holds an organtation together, whatevcr ts business or its 20 7 When people within he organization communicate with cochorher itis imernal communicaion and when people in the organization communicate with anyone outside ‘the organization it is called external communication sr ‘THE COMMUNICATION SITUATION ‘The communication situation is said to exist when There is a person (senderitransmitter) who wants to ass some information; There is another person (receiver) to whom the information is to be passed on; customer Retort Manogeient " The receiver partly or wholly understands the message ‘or information passed onto hi 7 The receiver responds to the message or gives feedback. ‘These four components are essential for ‘THE COMMUNICATION PROCESS/CYCLE: “The transmission of sender's ideas tothe receiver and the receiver’s feedback or reaction o the sender constitute ‘the communication cycle. The process of communication begins when one person (the sender) wantstotransmita fact, ‘dea, opinion or other information to someone else (the receiver). This facts, idea or opinion has meaning to the sender. The next step is translating or converting the message into a language which reflects the ides. Tat is the message must be encoded. The encoding process is influenced by content ofthe message the familiarity of sender and receiver and other situation of factors. After the message has been ‘encoded, itis wansmitted through the appropriate channel or medium, Common channel in organization includes pons, memorandums, teers, email fox snd pe is receive, itis decoded, telephone calls. When the messeee:2 tnwroduction fo Communication 2. eee by the receiver and gives feedback to the sender as the conformation about the particular message has been carefully understand or not. ELEMENTSICHANNELS OF COMMUNICATION: ‘The process of communication involves the following elements: ‘Sender or transmitter: The person who desires to ‘convey the message is known as sender. Sender initiates the message and changes the behavior of the receiver 2, Message: I is subject mater of any communication. may involve any fact, idea, opinion or information. must exist inthe mind ofthe sender Js to take place ‘communication 3 Encodiay ‘he communicator of the information ‘organizes his ies into series of symbols (words, signs, te.) which he fels wll communicate to the intended 4 Communication channel: The sender has to select the channel for sefding the information. Communication ‘hannel isthe media through which the message passes. Wis the link that connects the sender and the receiver. custome Relaonship Monogemant 2 5 Recelver: The person who receives the message is called receiver or receiver isthe person to whom the particular message is sent by the transmitter. The communication process is incomplete without the existence of receiver of the message. It isa receiver ‘who receives and tries to understand the message. Decoding: Decoding isthe process of interpreta of an encoded message into the understandable meaning, Decoding helps the receiverto drive meaning from the message. Feedback: Communication ian exchange process, For the exchange to be complete the information must go ‘back to whom from where it started (or sender), so that he can know the reaction ofthe receiver. The reaction ‘or response ofthe receiver is known as feedback rain: On whole process there is « possibility is called brain Bi of misunderstandings at any level and drain, It may aise on sender side if the adequate medium for delivery of message, by using rise when receiv do not choose default channel and it may also a does not propel devode the message. In other words, wwe can say that iis breakdown ofeycle at any levelIntroduction to Communication lon al ascent s ne am caine cet use eis Aspe Chae —) Receier [ie fier Eft / exchange information with people inside and ouside the 7 t— ‘organization you use @ variety of formal and informal forms st comin i] | Venda | (COMMUNICATION FORMS: 7 [mae [Pie wacdPianecd meinen Fomsanicesin|emunraten FORMS OF ORGANIZATIONAL COMMUNICATION: ‘Whether an organization is large , small or virtual, sharing information among its parts and with the outside ‘world is the glue that binds the organization together. When {you join 4 company , you become a link in its information chain. Whether you're a top manager or an entry-level employee , you have information that others need in order tw perform their jobs, and others have information that is crucial to you. To succeed organization must share information with people both inside and outside the company It includes the intemal and external structure through which _messages pass andthe way information is presented , as well famong with insiders| with outs letters, reports, | eters, reports, ‘memos, email) that] @ © m0 follows thejapeeches company's chain of| websites and command news release ) 2 [rowan |G as ual communication among employees | with suppliers, (email, freto-ace | customers. conversations and | investors and ‘hone ealls that do | other outsiders pot follow the | (Face- tor company’s chain of | conversations, command) femail and phone calls) Casual- Intodveton to Commonicata, INTERNAL COMMUNICATION: Itrefers tothe exchange of information and ideas wid. an organization. As employee, you are in a positon 1 obser, things that your supervisors end co-workers cannot see: ‘customer's first rection to a product display , a supplier’, brief hesitation before agrecing to a delivery date ory slowdown in the flow of customers. Managers and co. workers need these litle gems of information in order to dy their jobs, Intemal communication helps employees do thee jabs , develop a clear sense ofthe organization's mission and identify and react quickly to potential problems. Te maintain a healthy flow of information within the organization , effective communicators use both formal and informal channets Formal internal communication network : Tht formal flow of information follows the official chain of command. There are organizational charts in many ‘company’s which commands good communication flow. ‘organization information flows down , up , and across the formal hierarchy. Downward Now: Organicatonal decisions are usual ‘made a the top and then flow down tothe people who wil ci lore Roatonsn Management ” carry them oul. Most of what filters downward is geared towards helping employees do their jobs. From top to bottom, cach person must understind each message, apply it, and pass it along, Upward Flow : To solve problems and make intelligent decisions , managers must learn what's going on in the organization, Because they can't be everywhere at once, executives depend on lower-level employees to furnish them ‘with accurate timely reports on problems, emerging irends, “opportunities for improvement, grievances, nd performance. Horizontal ow : Communication also flows from one Aepartment to another, either laterally or diagonally. This horizontal communication helps employees share {information and coordinate tasks, and iis especi for solving complex and dificult problems y useful Formal organization charts illustrate how information is supposed to flow, In actual practice, however, lines and boxes on a piece of paper cannot prevent people from taking with one another. Informal interasl communication : Every organization has en informal communication network known as grapevine that supplements official channels, As people” nvroductlon 19 Communication zs LOEE——eeee_ew ‘g0 about their work , they have casual conversations with their friends in the office. Although many of thes th personal matters, about 80 percent ‘conversations deal ‘of the information that travels along the grapevine pertains to business, The informal communication network caries information along the organization’s unofficial lines of activity and power. The grapevine is an important source of {information in most organizations. EXTERNAL COMMUNICATION: ‘The external communication network Links the ‘organization withthe outside world of customers, suppliers, competitor, 1nd investors, journalists , and community ‘representatives. Sometimes this external communication is ‘carefully orchestrated ~ especially during a crisis, At other times it oceurs informally as part of routine business ‘operations Formal external communicati Companies use ‘external communication to create a fevorable impression. ‘Whether by eter, website, phone, fx, intemet, o videotspe ‘800d communication i the first step in creating a favorable impression. Carefully constructed letters, reports, memos, ‘oral presentation, and websites convey an important message custome Relators Monogement a ‘outsiders about the quality of your organization. Messages such as statements to the press, letters to investors, advertisements, price increase announcements and tigation ‘updates require special care Because of thie delicate nature. ‘Therefore, such documents are often drafted by a marketing ‘or public relations team a group of individuals whose sole job is creating and mans 1g the flow of formal messages to ‘outsiders. ‘The public relations team is also responsible for helping management plan for and responds o crises ~ which ean range from environmental accidents or sabotage ‘tuations to strikes, massive product failure, major litigation, for even an abrupt change in management. To minimize the crisis, expert communicators advise managers ‘openly , and often. If handled impact of 10 communicate hones improperly, a rises can destroy company’s reputation. communication: Although Informal extern ‘companies usually communicate with outsiders ina formal ‘manner, informal contacts with outsiders are important for earning about customer needs. As a member of an ‘organization, you are an important informal conduit for communicating with the outside world, Every employes informally accumulates fects and impressions that contribute jons collective understanding of the outsidewert ne ane fr daly You Ray, tbe is and pices of nfrmation that alt tole nelege fo compan. Tp manages ej ewiy en normal costs wih dest ge istoretn th mig be sl oir copies. Ma, of their networking involves intersetion with fellow executives. Many tp level employees recognize the fic: ‘that keeping constet touch wth the external real worl, foct line employees, customers by making @ opportunity to talk to them and getting feedback helps in organizational improvement. Receiving feedback is considered to be the ‘most important aspect of communication BARRIERS & SOLUTIONS OF COMMUNICATION: AS we already know, the four parts of effective communication includes the sender, medium, receiver and feedback. However, communication may fail if there are ‘problems with one of these four fetures. fone part ‘becomes a barier to effective communication which might ‘long with the name ofthe ocipient, tele ile and company name. you sre not sure who the letter should be address: to ether leave it blank or try to put ina ttle, Le. “Director of Human Resources ‘The Greeting ‘The greet will eddvess the individual dhat the let: fs being sent to. This is usually completed in the form o ‘Dear Anne" or “Hey Anne", for less formal letters. costar Retatlomino Management a gutomerRetmtonine Monogerent ‘The Introductory Paragraph “The fist paragraph and will generally outline the purpose for the Ieter and the reason ta the eter is being sent, This can address any issues that are outstanding and is used to set the tone for the entire rest of the letter: fn this fist paragraph, the summary of the lever can be found and. the intentions which willbe displayed through the ext of the letter should be outlined. From the fist paragraph of the letter, the introduetory paragraph, the individual should be able to note the tone of he letter. ‘The Body “The body ofthe leter wil expand upon the introductory paragraph and the individual can extend thee thoughts and feelings further when it comes tothe leer. The body ofthe Jeter can be anywhere from multiple pages for personal fewters, 1o one page oF to pages for most business letters and other types of proposals ‘The Clo the individual will lose Inthe closing of the let the letter and finish any thoughts that have been mentioned The closing ofthe letter comes in varows (9“ tnmoducton fo Communicotn, 4 eaimeconmnotn truly fo those individuals that are familiar with one anothe, to a traditional sincerely which is a versatile closing thy, can be used ina variety of letters detailing many situations ‘The Presentation ofthe Letter The presentation ofthe letter can be hand-written fy Jess formal letters that are addressed to friends and family members, especially thank-you letters. In the case that you have illegible handwriting, you may want to consider typing the letter in these cases, although proper etiquette dictates against this ype of behavior Formal eters which are written on behalf of businesses ‘© oF professional contacts should remain typewritten and Brammatical and spelling errr fee. These types of letters Should bs legible and professional and therefore typing the eter is one of the most effective ways to ensure thatthe leter demonstrates a professional appearance through the emits course of the letter, thereby creating a positive impression onthe recipient ofthe lete. | | customer Relatonthie Managerent “ ‘The one should be established from the greeting of he ltr, {no the introductory paragraph, throughout the entite body ofthe letter and even into the closing statement and closing greeting ofthe letter, Read through the letter once it has heen completed to ensure thatthe fone remains the same. The tone can be adjusted based on the language which ised through the leter, as well as the grectings (familiar es opposed to formal) Letter Writing Tips + Always prooffead your let sentence structure, grammar, spelling mistakes. ater writing it, check for + Proof read your letter again (and again) after you have revised it. + Keep the recipient in mind, and write in sway that he! she can easily understand the lee, + Don't use abbreviated dates, ie. use November 19, 2004, and not 11/19/08 We respectful when you writ ‘letter of complaintrodvetan Yo Communica, Business letter writing tips 4+ econeise and keep tothe point, but don’t Feave out Important information + Trytokeep your eter short enough 30 that it fits on oe ge ‘+f your eter is more than a page Tong, use another pags, don’t use the back ofthe page + IF you have access to company (or personal) statonay With letterhead on it, use that instead of regular paper Business Letter Writing ESSENTIALS OF A BUSINESS LETTER Busines eters can be, ‘= Informational, ‘+ Persuasive, + Motivation, | + romodon | Hlements of Good Leter | ‘The most important clement of writing a good lee | your ability to identify and write to your audience. Iryou a | customer Rotonstip Managemant e ‘aeressing your letter o the department of human resources, ‘void using highly Lechnical tems that only engincers would understand, even if yout liter is addresed to an engineering ‘company, chances are thatthe personnel in human resources does not bave an engineering background, Te next element is that you make sure your present your objective in a clear and concise manner. Don'tbe vague about your objective, most people will ot have the patience to sit there and guess at the meaning of your letter or the timetto read a long-winded leter, just gett the point without ‘going into unnecessary details “Another important element to remember isto remain professional. Even if you are writing a complaint letter, remain polite and courteous, simply state the problem(s) slong with any other relevant information and be sure to avoid threats and slander, Business Email Writing “The following are some tips to elp you when you are Uriting business letters through email + Arheading is not necessary in an email (your return ‘address, their address, and the dat).4 __mnssomnty “Avoid using an inappropriate or silly email regis.) profesional sounding address if you don’t have on | + Keep your letter formal, just because it's an emai instead of a hard copy is no excuse for informs (don’t forge to use spell check and proper grammar) | + Try to keep your letter less than 80 characters wide some email readers wil create line breaks on anything longer and ruin the formatting. t If possible avoid attachments unless the recipient has ‘requested or is expecting an attachment. [fit isa text, Aocument, simply cut and paste the text below your leter and stip off any special formatting. the person's name is unknown, address the person's ile i.e. Dear Director of Human Resources. } reveal ate jal (pos. orneg.) (reconstructive) ‘Swat Tee: eccpeane acs Steaua ‘ri ing Linen ee ha aang tg eae A ‘pec nL anegs Utetd a asEse) SLs Te Acie itn renting ‘Siiie tens ‘BING QUT ADVANTAGESOF LISTENING, Wachee nce z 4 eee Remy tes nts fi 5S lintel. on gs ene porary ap)RTANCE OF Lis Listening is a kil hat is important because it hep, Jean and understand different things. Usually, a person | listens properly is able to react appropriately to a partic: situation towards a particular person. sy (COMMON BARRIERS TO LISTENING “Trying to listen to more than one conversation at atime ‘You find the communicator atactive/unattactive ‘You are not interested Not focusing Feeling unwell or tired, Identifying rather than empathiz ‘Sympathizing rather than empathizing You are prejudiced or biased ‘You have preconceived ideas or bias ‘You make judgments, Previous experiences Preoccupat Having a Closed Mind ‘EIGHT BARRIERS TO EFFECTIVE LISTENING 1 - Knowing the answer 2. Trying tobe helpful 3 «Treating discussion as competition 4 Trying to influence or impress 5 - Reacting to red flag words 6- Believing in language ‘7 Mixing up the forest and the trees 8+ Over spliting or over lumping INTRODUCTION TO CRM Selling has always ben the vital force in carving (statue) te economie development of any compan. Aplydesribe sine development of selling has beer frm “hawkers and walkers’ to a burdensome role imposed by the aggressive marketing regimes intoduced bythe large, tureucratcally managed companies." - Roy Church “More so in the present word, where competion an ast track culture dominates the market place, selling is ral ctallenge. Today, selling oF even marketing as Jt mare tan what the dictionary defines itas* the exchange of goods for an agreed sum of money’ Bh for sling a wll s for marketing, ove mst ave nomledge of everything ~ leas, queries customers, es feedback, relationship, and reuiremen and soon, Simi the advent of technology bas brought about an apart Providing services and produts that are exactly What your customers want oF Offering beter customer service Cross selling products more effectively Helping sles taf close deals faster Retaining existing customers and discovering new ones HOW CRM BENEFITS FOR BUSINESS? ‘CRM is often misunderstood as an application or & toot, but in dhe rel sense ofthe term it isa way of doing business. ‘There ean be innumerable reasons for businesses o implement CRM, However, lets take a look at few ofthe most apparent benefits of using CRM. 360 degre view of business Organizatona-level dat sharing, | sa Reduce cost on customer acquisition “"Cengalized customer interaction F mproved eusomer suport, Increase customer satisfaction 7 High rate of custome retention 7 Boost new business Increase revenue at low cost customer Relator Managemen o th CM eae senate nen ‘The present business scenario assigns great emphasis on managing business customers. Organizations are quickly recognizing that in order to survive competion tis mporant to grab customer attention with unique brand identity and superior service levels, Busineses which iilly focused on finance / sales / marketing management ae now shin teir priority towards customer relationship management. CRM. solutions are flooding the market with easy-to-use tools to manage business customers Every business organization depends on customers for sustenance, the question is how to ceat and maintain customer satisfaction. Every business communicates wth heir clensin many different ways, especially in our technology nich and information base soviet, How we west al f ths information Is where CRM plays a key role CRM, Customer Relationship Management isa business Philosophy towards customers, 1 focuses the customer nessIntosuetion 1 Chie o rionshis, with a view £0 maximig and improves thet ea “ustmer satisfaction. ecncompases te variety of ecology tmployd oseeamline estore interaction 10 find, acquire and retain customers ‘Why sit Important? very business has to focus om the needs ofthe custome, ‘CRM (Customer relationship management) isthe array of processes that help company to understand the preferences or dislikes of individual customers in order to build lasting relationships. CRM solutions help to safely tore volumes of customer data in an organized easy-to-access manner. By analyzing this data businesspersons can determine individual customer behavior analyze preferences and provide one-to-one services to maximize customer satisfaction. Such a customer ‘cerric approach helps to augment customer loyalty and increase their value tothe company. Philip Kotler the Marketing guru now replaces 4 P's of Marketing by the A, B, C, D, and Es as follows: Anytime-anyvhere shopping will occur and it replaces ‘place’. Companies must design integrated strategies for the market space, the marketplace and market face Customers want convenience customer Relllonitip Maresement e B-web relations drive revenues. A brand reflects relationship capital. Think of ustomers as part of your ‘Beweb, and prospects as candidates for relationships, not as markets for your products. B-web is synonym for ‘usiness web or ERPWEB or e-business Comm eatlon works, not ‘promotion’. A man in ‘communication saan in business. One-way media ike broadcasting can be part of the marketing mix, but the customer decides whether - and with whom -to engage ina one two, or muiti-way communication. Discovery of price replaces fixe price’ Now days when fiems control prices are neatly ove. Supply Chain Management which manages supplier & make-to-stock manufacturing will be replaced by Demand Chain “Management which manages customers & maketo-nder manufacturing. Every make-o-order product will ave Afferent price, s0 itis discovered. Experience replaces ‘product’. Customers poy for experience, not prods Products mst be bundled with enhanced, customized services. The automobile experience replaces the product asthe ct Dezames a platform for tansportaton steactive entertainment, safety, doing business, and having finnroducton 0 CRM » KEY CONCEPTS OF CRM © Comprehensive strategy: sd links itself © SCM (supply chain (CRM at one en ‘managernent)andon the oer hand the cust nd castomer care. Tis makesa comprehensive stray 2 Acquirin -Trisisabout prospecting Using effective sles promotion methods, prospective buyer can be acquired. It is about developing new customer as well as converting ® coneitors iste. Selection: ‘You cat please all people at all times. You may not be able to serve and satisfy all the customers atthe same time. There may be customers who may not be willing ‘0 have lng time relationships with you. AS a consequence you need to have selectivity in the customers as well 7 Retaining: (Once a right customer is selected, we need to provide the customer with a good product and a better service which cexeceds the customer requirements, Only then can the customer be satisfied and retention ofa customer can 8 possible customer Rettontnp Monogeme Partnership Partnership is about consanlysriving to esate beter value foreach other. the buyer and he seller rInteractive communication: A clearly planned and focused two way, inerative communication isa very essential ngreien of CRM.A meaningful communication will alwaysbe an Interactive ‘Communication ir Technology + people: CRM isall about people wd relating people technolo: ‘This is all automation of peopl sal about! Mutually beneficil long-term relations nis all about the longterm relationship ofthe buyer and the seller. The overall reals inthe muual benefit ofboth parties will erete long-term relationship Customer delight needs to be created instead only satistying the customer. Customer sve i bout S05 fies and serves that he caste ahs or NSE service that is expected in today's coetsive worth Most Products require additional OF long-term support from the vont services eile GEN6% organization, These tInwodvetion to coy 2 suction manta epi gg instalation, lessons in-use eruce case caren abo COMET SLA) eyo he eptation ees Hi” Customer cae | ing beyond the“ veloping eatonship with YOUF custom being proetive in develope wn | eeodcustomers are worth Keeping ori Alvays emer nce and custome Great services can create a great experi delight [THE VALUE OF MPLEMENTING IN CRM Some ofthe values of implementing a CRM are: = Your goods and services will improve based on your ampact from customers. Valuable feedback from you castomers will allow you to more directly meet thi needs ‘You wil ineease the speed of your response to custome: ‘concern. This wll esull in happy end loyal customer, ‘which in tum will impact your company’s bottom lin, ‘7 Your knowiedge of your customers will grow. You will ‘beter understand your customer needs and wil therefore bbe more abl to meet those needs resulting in sais customers omer Relationship Management cu Morage a “There is only one boss: The Customes. And he can fire everybody inthe company frm the chairman on down simply by spending his money somewhere else" Sans Walton Customer Relationship Management puts the business {focus back on the customer where it belongs. CRM combines business process and technology tocreatea better understanding of customers. Consequently, Customer Relationship “Managements alsoknown as Client Relationship Management. ‘CRM helps to identify new customers and retin existing castomers. To reach consumers who willirly benefit kom your services, it's important that marketing campaigns define clear ‘objectives and goals directed at an appropriate audience. The audience is defined through CRM. Keys to suceessful CRM implantation + Develop your customer-focused strategy fist before considering what kind of technology you need, Break your CRM project down into marageable pieces by setting up pilot programs and shor-tern milestones ‘Start witha pilot projet hat incorporatesall the necessary “departments but is small enough and flexible enough to allow tinkering along the way.Intosuetion to cry ke our your CRM plans incu a SAD weit amevork. Tink carefully about what is Best for yy teria sohition thx ts together “Dest of bret estware from several vendors via Web Services ray integrate package of software from one vendor. ™ “+ Don't underestimate how much data you might eoles (ere willbe LOTS) and make sure that if you need ‘expand systems you'l be able fo. + Be thoughtful about what data is collected and store, “The impulse wil be to grab and then store EVERY piece of data you can, but there is often no reason to store da, ‘Storing useless data wastes time and money. (CRM SIGNIFICANCE TO THE STAKEHOLDERS, “We begin with an overview of how CRM is typically efined across stakeholder types. We then ground our CRM framework and thinking by introducing network and stakeholde ‘theories, drawing particular attention 1 the nique and oer conflicting perspectives that each of the many stakehollen ‘nvolved in this arena typically hold concerning what CRMs conceptually, how it shouldbe implemented, and how its xs should be measured. pore ROHR Mannan} t We follow with an introduction of our “Shareg ndersanding” CRM framenorkaed elated popstne pis Famework i wed a a depart pointo dean sesp sacholder tYPe8 1pically involved in CRM initiatives, igctuding their specific roles and agendas. We then discuss, aieit i a preliminary manner, how firms might go about regotiting 4 Common understanding of CRMincuding a Giagrostic framework applicable to any CRM intinive We conclude by offering number fie pity iases fer iter serch and addtional ingiry ISSUES IN CRM AND MULTIPLE STAKEHOLDERS Individually, the various stakeholders involved in the trond domain of CRM offer unique and comgelling perspectives ake phenomenon, One key problem, however, that mest siakcholders’ CRM definitions (highly focused to traty represent all that is inherent in she Underlying phenomenon or far too vague and lacking in pertonal specificity to be of any weal use. As an example o the acutely focused, buiks his CRM definition around te yer far too acutely ‘Ftc notion of customer dat capt fr the pas of ‘stance segmentation an ageing bye “vee” fm AL Secier end ofthe spectrum, acommoa enkesy 0 define OHM as a ‘vague metaconstruct equivalent to “marketing” oFCame Makin & Company QOD): Or sane ay ht "CRD is anarenally 4 static AMORA 10 manage customer value and experiences” CRM consultant and analyst reports, and the acaden erate eval that the various definitions of CRM offers tose create landscape idle with definition inconsisten, inberently config stakeholder goals and objectives, arg general confusion. As »deprre pint nto the theoreti perspectives thal underpin our inking and CRM framework, vee suggest tat itis both file and gical to attempt to cre, a single, widely accepted definition of “CRM” because in be end cach rm sutique 28 are its customers, markets, busines ajectves, resources, and perhaps most important, th stakcholders who willbe germane (relevant) ofits pectic CRM circumstances. (CRM AS ASTRATEGIC MARKETING TOOL Companies can only prec what theie customers will d> inthe Faure ithey keep a record of past behavior and know how to translate this information into knowbedge abost customers. Successful customer relationships draw on ths Knowledge, And that is where the potential added vale customer relationship management lcs. emer ecole Manager! ———__ —" Gq IN COMPETITIVE ENVIRONMENT PUBLIC pELATION: {He PERSONAL TOUCH ‘Mass customization isthe perfect way to bridge the gap erween cost pressures and customer-specific requirements _Tissrategy combines customer specific prodcts and services vith the efficiency of mass production. The customer who previously bought standard product can now walk aay with 1 ilored solution. Similarly, companies tat traditionally produced custom-mede solution can still manufactreto oder, tut on a large scale, thanks to powerful new processes and product structures. Naturally, this eus costs Furthermore, mass customization provides the basis for successful customer relationship management (CRM) through diet intercton with ‘ach customer Mass customization holds considerable potential: + Differentiation through individuality Prods hat re eate specifialy for acustomer dot fae pis #2 The emphasis is shifting fom pice to value andrscarch shows that customer wh pesos bought a standard duet soften prepare pay up 6100 percent orefor a personalized product. Despite higher production coats, therefore, the margins for mass-customized woody ae often greater than those for comparable standardize 00d, + New ways to cut costs: Direct interaction between « ‘company and each of its customers makes production ‘more efficient and drives down coats. The “on demand™ Principle prevens inaccurate forecasting of final products and reduces high inventory costs. On the manaactring side, inventory is restricted to raw materials and ‘componens, some of which are also procured to onde. Elimination of finished product stock ean dramatically lower storage costs. Moreover, es surplus stock means less depreciation when models become outdated. For ‘example, in the fashion industry, a considerable £300, million (approximately U.S.$370 million) is wasted each {Yaron unsold products and inaccurate planning, This figure underscores the hge cost-saving potential of mass ‘customization, Long-lasting customer retention: A further benefit of ‘customer-specific services is improved customet satisfaction and retention, Persona interaction betwees. the manufacturer and individual customers is vita if the pot Rolasorship Hanagemant cate company is 0 pte camer pie train ag translate i ino llr made poets, This inercon forms he basis fr kenge cone etn sas customization 49 the bast for lasting CRM. Inisthe manufacturer's job to use he information received ducing the customer interaction effectively and profiably Customers supply mass customizers with a great deal of information about themselves, either by stipulating thee own seeds or by enabling the provider wo infer thei requirements fomthe configuration process. Not only do proviers ascertain theircustomers’ preferences, they use this hnowledgeto create addtional benefits forthe customers ‘A customer wants to buy personalized nning shoes fe scound U.S:$150, The more the customer ell the vendor sou hisher likes and dislikes during the integration process, teeter chance there is ofa product being tated at meets lisher exact needs on the first ty. ‘Alter delivery ofthe customized product, feedback will be collected ffom customer. The manuf can dow om Second, high-quality processes must underpin these customer-specific services, Using anew information and ‘communication technique effectively is just as important 1s having well-trained, motivated sta to interact with ‘customers, The aim isto create an atmosphere conducive to customer integration and ensure that every communication between customer and company is a Positive experience leaving the customer convinced thatInweduction to coy, qo remain loyal is more convenient thAN Lo tum 1g competitor. ‘Companies that want to tok in customer loyalty agg aximize profitability need to emplay four CRM tactics: 1) Buildacastomer growth strategy upon & CRM foundaticg of strategie intent and cost management; 2) Avoid the CRM whipsaw effect; 3) Don't buy into the technology silver bullet; and 44) Measure satisfaction with CRM. ‘These tactics will ensure that CRM programs can successfully adapt to the pending changes in the economy. ‘Bolld 1 Customer Growth Strategy Businesses must build topline growth strategies upon the foundation oftheir CRM programs by ensuring that strategic intent and cost management measures are institutionalize “Many companies have not determined strategie intent or have not focused on developing clear metrics to measure performance. Yet many have done some cost-cutting witha ‘customer facing functions and lowered their costto-serve jst {reduce the overall cost of sales. These cost structure change custematRellonine Maragement » should be modified to invest in these fields of CRM so tat growth strategies gain some early wins, no mater what state ‘the economy isin ‘Aste economy tums into recovery. the winners are likely tobe those who have not only stabilized their customer sevice and sales costs, but those who are improving the effectiveness ‘ofeastomer retention and loyalty programs. improved customer segmentation, customer satisfaction, and service strategies should be tailored in downtums and expanded in upswing, but need to remain long-term goals of any succesful (RM program. Avoid the Whipsaw Effect Senior management ‘commitment is eritieal tothe success of any major corporate initiative. CRM is certainly no exception. Infact according to the CRM magazine/A.T, Kearney survey results, ITdeision makers ranked executive sponsorship a8 the most importaat factor for maximizing the return on their CRM nvestbents. I ‘CRM initiatives are not nthe CEO'S agenda, then investments in these initiatives have a much lower probability of succes, ‘Aaditionaly, because CRM i a fundamental si nthe ‘way a company does business with is customers, rater than just a one-time e-business initiaie, it requires sotinones leadership support over mukiple years. This type of Tong term,u Intron to Can, Moen senior management support can only be achieved ang ‘maintained ifa long-term strategic plan is developed. The time frame also requires the strategic plan to have builtin ‘contingencies for the ups and downs of the business eye Without this type of exible strategy, companies get caugh in ‘4 CRM whipsaw:overinvesting in one year and then cutting > the bone in the next. The result is unrealized investments, squandered opportunities, and a loss of employment forthe CRM champion. The whipsaw may affect users as well Employees whose new customer-centric behaviors enable CRM suceess can get caught in the whipsaw if communications abot ‘customer strategy and CRM processes are no clear or consistent throughout changes in the business cycle. ‘Measure Satisfaction with CRM Measuring CRM sucess has often been elusive, bits possible to measure satisfaction with CRM. Companies have fen measured sucess citherby ROTorby changesin custome: satisfaction to justify CRM benefits. Although capturing ROI and preventing CRM budget expansion is important, the CRM smagazine/A.T. Kearney research indicates that 60 perceat of companies claim their CRM initiatives met or exceeded expectations. Ofte res, 25 percent dd not set expectation. for the moment INET APPA to be more saisfction sth projects than not, se cRM However, ROI gee meses ema eam of 1ecinol08y! PFOCES OF organizaticn improvemer peje In the survey, extemal measures like customer satisfaction, ‘enon, and protiabilty—ofen he bes nds of tow sell customers view thet over retonshipwthconpaies - vere selected by only 37 erent, 3 percent a 2 percent respectively ‘This leads toto possible conclusions: 1) Given the challenges of deploying CRM inkitives and effecting customer change, companies maybe assigning Tower levels of expected success without engaging tet customers: 2) Companies are embarking on expensive CRM initiates “without understanding the drives of their customer satisfaction, retention, and reutngpofabiliy Incither scenario, companies ae shorshanging themselves by reducing the future value oftheir customer relationships and placing the fong-term sucess of those Felons hs atrisk= ntosucton 6 chy sl From an intemal perspective, RO! was the dominay metric used to measure retuns, though notably 21 percent of respondents’ know how their companies measured retuy [As for time-totetur afer projeet completion, Most oF those surveyed were split between the sito 12-month time frame and more than one year. This son average longer than mos. ‘busines iniativs, and refets the fact that CRM often involves, multiple chamvels and functions undergoing organizational process and technology’ changes Given the complexity and level of investment in CRM, ‘companies nce to ensure they understand the divers of value in their customer relationships before they embark on mjor initiatives, as wel as build robust business cases for internal measures of CRM success, ‘CRM BUSINESS STRATEGY CRM strategy should be aligned to the organization's rission and purpose in order to himess the power of CRM software and bring about a sustained achievement of business ‘objectives and profitable customer elatonships. CRM strates ‘ary; however, the mos suceessfl trategies have several things sNnovarion unr R&R Og EXTENVALUE CREATION era ‘THE TOOLS ARE, AQUISITION RETENTION EXTENSION MARKET ORIENTATION VALUE CREATION INNOVATION IT ere the frst three tools are key phases andthe remaining loos are contextual factors. AQUISTION ‘This tool is important for yer ur potential stoner Attracting and target the cus ‘Make the customer for first purchase Induce the customer for purchasete Invtoducton 1 cay 4 Induce the purchasing behavior 4 Create the awareness about the product RETENTION 4 Retain every customer for strengthen the base. + Purchase of similar produetsservice or the next level of productservice + Moke them regular purchase EXTENSION Induce the customer towards Additional and supplementary purchase ‘Introduce the productservce to loyal customer diferent from original customer ‘+ Once purchased, our prime intent is to retain them for ‘extended productsservice MARKET ORIENTATION + Before ine commercialization of the produets/service ‘analyze the market and segment the market % Analyze the customer needs and w Identify the actual and augmented products/service qatamat Resotoniia Moragerarh VALUE CREATION ‘¢ Generation shareholer’s value based on the cstom satisfaction and quality product ‘¢_Delivery of sustainable competitive advantage 4 Create unique strategy for business (E.G) IPL shareholder's value increased by advising and by brand ambassadors INNOVATION IT Efficient, speedy and focus the customer needs 4 CRM software collects dat on consumers and their transaction + Organization will rade individual and try to market the products/service to them based upon similar buyee behavior seen in other individu SUCCESSFUL CRM STRATEGY owing funtamental things, Its build by addressing | Understand WHO is your customer are + how both parties derive value from the relationship .e)what is your customer need from you andi they are look foe after ales seviceIntodvetlon 1 Cay © Build process and system to remove blockages by cffective methods and relationship and by software, + Clearalignment between the organization's purpose ang the CRM strategy; a strong strategy i direct reflection of the company’s purpose and supports the company vision indirect and easy to understand terms. + CRM strategies must be eusiomer focused; they should aniculate the positioning, evolvement and objectives of, the customer relationship. + CRM strategies must have senior executive sponsorship and complete buy in fom across the organization. Both staff and management take their cues from the executive ‘cam so it is imperative that the executives are visible, ‘vocal and active in their sponsorship ofthe CRM strategy. + CRM strategies, just like other business strategies, ae iterative processes; as the organization advances 80 19 will the CRM strategy. IMAGE BUILDING: Image building means, building the perception people hhave of your business when they hear your company name! snlotionsnip Management a © ot MMSE el iy te a re irutare with he rictewen Tape eon a Ord he nice veer mre sagarae ely dt mags poe secommunity’ efition : mage building i basically “improving the public image fsoeone through good public relations”. This term cam also ‘ef to te improvement of brand's image through advertising FACTORS INFLUENCING IMAGE BUILDING: Customers Stakeholder Service requests Resource usage Business part Market segments Opportunities Customer portfolio Foints of contact2 iodo toy > Business process ot > Service agreements jG 1tt8TS OF IMAGE BUILDING, > offerings poe ee > Accounts Memorable > Fines earn > ocsors yey 4 transferable Tae 5 Adaptable fo (pielow Introduction foc, How TO BUILD A TRULY CUSTOMER-CENTRI¢ COMPANY? ~ BY BUILDING IMAGE - EXAMPLE, Creating customer cent compary is icky becoming atop priory of businesses looking to thrive in Our Consumes. powered world, We've sen plenty of data hat shows how seat customer experience goes lng way toward buiting busines that lasts, but embedding this sort of thinking throughout your company reuites quite a bit of finesse. Te belie in superior service has to be genuine and must bes motivating factor for customer facing employees. So how do the likes of Surbues, Amazon and Zappos create customer criente cultures at spur massive growth inspite of ample competition? customer? Customer refers to an entity that acquires oF consumes goods o services Fm a desired frm through the process sf purchasing of renting) for a mutually decided price and tas the ability to choose between different products and suppliers. n this sense a customer is also known as lien, ayer, purchaser or user ofthe products/servses delivered ceprovided by a firm or organization also called the supplier, seller or the service provider? RELATIONSHI Relationship in business refers to state involving ‘autual dealings between people or partes. It involves iavractions with customers or prospects to beter understand their requirements and to build an expectation through {ifferent channels of communication. The mots one ioterat ‘he more chances of building a strong business relationship ¢® he grounds of proper understanding of sustomers CRM ‘volves managing this elationshp soi is profitable and ‘Mutually beneficial. Customer Lifetime Value is a too! for ‘etsuring this relationshipCustomer Relatenig $$ rn CUSTOMER RELATIONSHIP “Customer relationship isthe process of managing deta ey information about individual customers and carfully managing all eustomer touch point” to maximizing customer loyaity’ RELATIONSHIP MARKETING VS TRANSACTIONAL MARKETING: “Transactional marketing asthe name implies is abou «ach party maximizing the return on individual transaction, 1es about immediate value delivery and short-term revenue generation. For IT companies, transactional marketing ‘ypically focuses on acquiring new customers and gaining market share But as we all painfully know, ceonomic eyeles go up and down with boom periods giving way to slow periods Transactional marketing doesn't work well during slow Periods because demand decreases significantly, spending is restrained and there are fewer new transactions to be had ‘Some companies continue pursuing a transactional marketing approach during slow times by using speci discounting, and other tact promotions, to keep new transactions lowing. Besides being ineffective, these short-term tactics ‘create longer-term detrimental consequences. 98 on the other hand focuses on Jong-term customer loyalty, retention and stisfacton 19 generate # continuing revenve steam from existing castomers. The "relationship” is wot about some cozy, umbaya intimate fiendship with a eastomer Reaonship Marketing i about continuing mutually beneficial business relationship process that encompasses the entre customer ife-eycle. Relationship marketing continues whether or not 3 customer intends to buy this quarter or whenever. Although felationship marketing should be a cornerstone of B2B riarketing strategy, many companies have recently found new religion in relationship marketing during the economic slondown, Relationship marketing is ultimately about generating ‘Additional revenue from existing customers using appropriate Fetention and Joyalty methods. The Key to successful Felationship marketing js to tune your retention, loyalty and ‘Marketing activities to relevant and prevailing circumstances segments of 7 Listening to customers or market segment ‘customers ~ they'll communicate ther eiteums needs and buying intentions.Cntomne:Pelatenig y camomer fe cle whats going on in ther bus when las did they buy, what did they buy? = Cestomer events ~ capitalize on major events such acquisitions, management ChaMgeS, NeW produc introduction, ee © Customer demographics - such s larger vermis sag companies, owner operated Versus corpora management, Industry — yous and your customer's Each industry hy its own economic eele and specific conditions Monitor cestomer service /support activites for wens in issues and complaints to identify threats ané oppor Improve your Net Promoter Score ‘Netpromoter Scores defined aa management tooth Can be used to gauge the loyalty of a firm's customer ‘elaionships. serves as a alternative fo adiional customer stsfacion research, The Net Promoter Score is obtained by asking customers a single question om a0 10 10 rating sae ‘How likely is that you would recommend our company 08 Arend or cllesgue? "Based on their responses, customers tt catered into one of three groups: Promoters (9-10 rating). "anes 8 rating and Detractrs (0-6 rating) omer Polaionthie Maranement a“ ven though your foe son retention and yay, always provide meaningful value that customers appreciate during the process, “The aim of marketing is to know and understand the ceustomer 30 well the product or service fs him and sells itself.” ~ Peter Drucker ‘The basic premise of relationship marketing isto stay engaged with customers and keep them long enough to buy more stuff from you. Marketing has moved from customer ‘acquisition to customer retention to customer selection. The importance of relationship marketing in retention of few profitable customers has become even more important than ever, Smith and Taylor in their book “Marketing ‘Communication: an integrated approach” are ofthe view that organizations today do not look at customers as buying one can of beans, one car or photocopying machine but they think of them as buying thousands of cans of beans, dozens of ars and photocopiers during their ie time, Today selling ‘as moved away fom short term, quick scale scenario and Selling today is more about “partnering” and relationship building, you don't sell to people you partner with themBBoqo eustomer Roar Managemen ™ customer Roa joerg FE Se EFTTS OF RELATIONSHIP MARKETING Relations racton | Trassne oleh) Relationship Marketing i rooted in the idea that itis Tis abasinesssrtegy | It isa business staieg | cheaper (o retain an existing customer than to recruit Denton | ac forusesonsngle te sc et new one. There are many benefits of relationship Sacral | long tom rela Pani wih it cattome marketing. ‘nde han fg sg anacton +t focuses on proviing vale to its cusomers and Tae cophais OF | The emphasis fy places a great emphasis on customer retention. aT = mniteg oe | Ti coho ; Stes at ohne | Spe Oy wa Sindee | naar asc] J + Secondly relationship makeing aproch isan ‘eer an dene | uintuin Seutowny oi | mee inert aproicho matting seve and qaity — and therefore it helps in gaining competitive advantage. Foci |The masons | Rakyat muting torus on | ocoe om cutoner| | The long term customer may do the word of mouth coun fesrglse | promotions and referrals and many studies have ‘ion Tit is oriented on | itisonprodutbeet| revealed that cost to retain exiting customer is just refs _} nyse soles fraction ofthe costo acquire new customers ‘Tine terne [srt time erzon | la em hora Coser Focus | ie cnome fats | igh emomer cus + Relational customer also tend to increase their Purchases overtime either because they are Infaraton | tomatic scones | ormaon i prot tcommunicaion | of communication ‘consolidating their purchasing onto prefered supplier ona = cenit wih | igh contact = ‘due to grown business! family and it has also been amarante — fe | and attr tenner Pts 4 1o this group as these customers a likely be les Mashup mci | Nakeg fone : a Price sensitive than others, fener Pnanad oo (Een |e Ong dale