NMIMS

Course: Customer Relationship Management

Internal Assignment Applicable for June 2022 Examination

1. You work as a vice president of a telecom company. After number portability was
introduced a lot of your customers have left you and have taken the services of
other telecom firms. You are worried and so is your top management of the
company. They have given you a deadline, either to ‘reduce the customer churn’ or
face consequences. This is a major KPI (Key performance indicator) in your
performance appraisal this year. How will he proceed to build a loyalty program
for his customers?(10 Marks)

Answer:

Customer churn is the percentage of customers that stopped using your company's

product or service during a certain time frame. You can calculate churn rate by
dividing the number of customers you lost during that time period -- say a quarter --
by the number of customers you had at the beginning of that time period.

Loyalty programs are effective at retaining customers by preventing them from

turning to the competition. These programs can also maximize the lifetime value of a
customer by offering incentives to spend more and buy more often.
Successful customer loyalty programs are win-wins for brands and consumers. They
bring additional recurring revenue to the company and make customers happy with
perks and rewards. All this adds up to a better customer experience, which can bring
better returns.

For a long time, marketing departments poured energy into messaging and product
positioning to lure new people to their brands. However, while creating new sales
leads will always be part of the job, it’s equally important to convert existing
customers into repeat customers. Studies have found that it’s at least six times more
expensive for businesses to acquire a new customer than to keep an existing one.
That’s why investing in customer loyalty programs — and the digital technology and
platforms to support them — is a growing priority.  

A customer loyalty program is a marketing approach that recognizes and rewards

customers who purchase or engage with a brand on a recurring basis. A company
may dole out points or perks, and graduate customers to higher levels of loyalty the
more they buy. These incentives and specific benefits often result in the customer
becoming a more regular consumer or the ideal — a brand promoter. Benefits may
involve free merchandise, rewards, coupons, or insider perks like early access to new
products.

The benefits of customer loyalty programs include:

 Better customer retention: Today, customers are making purchasing

decisions not just on price, but on shared values, engagement, and their
overall experience of your brand.
 More customer referrals: If your customers enjoy the benefits of your
customer loyalty program, they’ll tell their friends and family about it.
 Cost efficiency: It’s more cost-effective for your business to retain happy
customers than it is to consistently churn and acquire new ones.
 User-generated content: Programs that encourage happy customers to
publish reviews and ratings on websites and social media create authentic
ambassadors for your brand.

STEPS TO DEVELOP A CUSTOMER LOYALTY PROGRAM

Study your current customers

Here are some questions to ask about each customer:

  How much does this customer buy in a year?
 What type of products do they buy and how frequent are purchases?
 How long have they been a customer?
 Can we sell them other products?
 Do they use other suppliers, and, if so, who are they?
 How much profit do we earn on their purchases?
 How fast do they pay?
 How satisfied are they with our company?
 How could we improve our business relationship?

Prepare your customer loyalty program

Before launching a loyalty program, you need to assess your customers’ current level
of satisfaction through such techniques as surveys, interviews and monitoring
customer comments.
Then, identify employees who are good at dealing with customers and who will be
available to participate in the program. You will need to target customers who
purchase frequently from you but could become more profitable, according to your
analysis.

Set goals, and measure them with a CRM

Set your goals for the program from the beginning. This will increase your sales
by 10% with few additional expenses. Use CRM software to manage this program. If
you are looking for a low-cost or free CRM solution, you may want to consider our
list.

Set a budget
Set a budget for managing customer retention and a separate one for developing
new customers. To do so, consult your industry average, if you are looking for above
average growth, increase your budget accordingly.

Decide which customers to target

 Categorize your customers (e.g. A, B, C) according to evaluation criteria that are
adapted to your needs and objectives.
 Volume of purchases
 Ability to purchase more products and services
 Speed of payment
 Customer profitability
 Loyalty over time

Choose tactics that will encourage client loyalty

Choose loyalty enhancing tactics that are related to a customer’s purchases, but also
to the quality of your business relationship. Here are some examples:
 Monthly visits from a sales representative.
 Personal invitation to a seminar and dinner given by the president.
 Premium service—guaranteed 24/7.
 Emergency phone line and secure website access.
 Additional discounts when purchase milestones are reached.
 Sponsorship of an annual event.

A good customer loyalty program can generate significant gains in recurring revenue
for your business by improving the return on your marketing and sales budget.

2. You have been called by your director at his office one evening for a cup of tea.
Over the discussion he mentions how difficult is it for him to:

Manage the data of the past students and track them. He is losing track of them
and this is not good for the future of the college.
Managing the admissions of the engineering and MBA College.
The MBA School plans to expand in the distance education mode, for which a plan
has to be put in place, and it will be difficult for him to manage alone.
He wants to automate some of the processes of fees payment, acknowledgement,
and attendance.
Automate reporting to the top management.

The immediate thing that clicked on your mind is that if the college had CRM
software it would probably help. You need to explain him, how CRM projects work
and what are the considerations that he must keep in his mind.(10 Marks)

Answer:

CRM is an abbreviation and means Customer Relationship Management and refers to

a software system used to build and manage customer relationships.
CRM software helps businesses manage all of their interactions with their existing
and potential customers. With a CRM platform, customer details and preferences are
recorded and customer activity is tracked. This means customers receive a fully
personalized and consistent experience every time they engage with a business.

CRM software also helps organizations streamline their processes and workflows so

that every part of the business is on the same page. Sales and marketing teams,
especially, rely on CRM to create collaboration and improve their productivity.
The overall aim of CRM software is to provide more engaging customer experiences,
increase customer loyalty and retention and drive business growth and profitability.

Higher education institutions (HEIs) are experiencing vital changes in the way they
operate and interact with their ‘customers’, i.e. students, their parents, alumni,
employers and staff members. Higher education clients are demanding more
attention and instant service and so proactive universities are turning to technology
– customer relationship management systems – to cater to this demand in an
effective way.
Higher education CRM systems normally serve three key audiences: prospective
students, current students, and alumni/donors. 
College CRM software allows higher education institutions to collect, maintain, and
analyse data about prospective, current, and past students. In many cases, CRM
systems are used to make crucial touch-points throughout the student lifecycle, from
initial application all the way to graduation.
A higher education CRM system also helps staff members improve communication
both internally and externally. Because CRM data is visible cross-departmentally,
everyone who interacts with a student can view and log information about the
student's holistic experience.
As digital platforms, CRM systems integrate with other business-related apps and
processes with the goal of completing administrative tasks more effectively.

Benefits of higher education CRMs include:

 Elimination of data silos – In higher education, departments work separately,

but share the collective goal of serving students. Thus, it’s critical for all staff
members to have access to the same set of data when providing customer
support and guidance.
 Time saver – Most CRM systems have automation tools that replace manual
processes. These features allow staff to focus on more significant
interpersonal communication and tasks.
 Transparency across departments – College departments require real-time
and historical data to make decisions that influence the entire campus. A
CRM system promotes clarity as a way to improve the business and
administrative culture of higher education institutions.

Here are the key considerations as you decide whether to build or buy and narrow
down your options between providers:  

Unified & Integrated

Despite the verbiage, this type of CRM is typically not what you would call a
‘uniform’ offering. Different elements are developed separately and then joined
together, which can be time-consuming and somewhat complex to build, maintain,
and use. The end result can sometimes feel makeshift and lacking in consistency.

Converged
A converged CRM, on the other hand, offers an ‘all in one’ solution, tying all the
features and functionalities together in one tidy software system. Student
recruitment, admissions, marketing and communications systems are integrated into
one streamlined program.
A converged CRM will also provide consistency in terms of usability and design,
making it easy for teams to use and get to grips with.

Adaptability and cost-effectiveness

It can often be difficult for university IT departments to build software as complex as
a SaaS application and it can be an incredibly time-consuming endeavour. In a lot of
instances, home-grown solutions are comprised of open-source software
components integrated together.
Although this can initially seem like a cost-effective approach, the end result runs the
risk of lacking the depth and adaptability of a professional software system and may
have to be replaced by one in the future.  Consider the cost of having a dedicated
team that will design and maintain a custom solution for your university. You must
also consider the cost of ownership, infrastructure costs, and opportunity costs of
having your IT team unavailable for other projects. Compare this versus the turnkey
cost of a SaaS CRM that will upgrade and incorporate the best practices from all
higher education institutions they work with.

Growth and scale

Universities evolve at rapid rates from both operational and marketing perspectives.
The software they use needs to be adapted to fit with such changes.
For in-house solutions, this presents more complexity in the development process. A
common problem occurs when staff members who initially develop the solution
move on and existing staff have to reverse-engineer the software.
 At the end of the day, every university operates in its own unique way. Choosing a
CRM in line with the academic, recruitment, marketing and future goals of the
institution is important.

To stay ahead of the game, universities need to drive value at every stage of the
student lifecycle. If not, they run the risk of losing prospects to more astute
institutions that better cater to their students’ expectations. CRMs help universities
manage communications with students before they enroll, during their tenure, and
after they graduate.

3. Shoaib has started his business about a decade ago and has been doing extremely
well. Although he was one of the pioneers in the organised retail space, he is today
facing abig issue with ‘loyalty of customers. He is planning to go online.

a. How can he build traffic to his website? (5 Marks)

Answer:

Website traffic refers to web users who visit a website. Web traffic is measured
in visits, sometimes called "sessions," and is a common way to measure an online
business effectiveness at attracting an audience.

When someone visits a website, their computer or other web-connected device

communicates with the website's server. Each page on the web is made up of dozens
of distinct files. The site's server transmits each file to user browsers where they are
assembled and formed into a cumulative piece with graphics and text. Every file sent
represents a single “hit”, so a single page viewing can result in numerous hits.

It is not only the traffic on the website's homepage that is monitored. Rather, all
segments of the website are constantly monitored by the server to determine
exactly how many hits each receives. In web vernacular, a single visit is known as a
“session”. The minutia of each session varies, yet each has a beginning and an end
point.

Servers are able to compile every request for a web page, arming its operator with
the information needed to determine how popular the site is and which pages
receive the most attention.

Perform Keyword Research

Always include relevant keywords in your content. Keywords should be used
naturally, not stuffed into the content so much that they detract from the main idea
or distract the reader. It’s important to use keywords throughout the content, like
the Meta description, the page title, the URL, headers and a few times throughout
the piece.
To conduct keyword research, you can use tools like Moz, Ahrefs and SEMrush.

Write Guest Posts

Guest posting for other websites is an effective way to generate backlinks, boost
referral traffic, and increase search engine results page (SERP) rankings. You should
always thoroughly research websites within your industry to pitch.
First, look at a website’s content and make sure it’s high quality, check its domain
authority and study their guest posting guidelines.

Keep Active social media Pages

Social media is huge for attracting visitors. Here are some ways it should be used to
increase website traffic:
 Post content (blogs, e-books, white papers, info graphics, videos, etc.) across
your social media platforms
 Interact with followers by replying to them, reposting their content and
tagging them
 Use relevant hash tags

Use Advertising to Increase Website Traffic

Advertising through paid search, social media and display ads can be an efficient way
to increase website traffic. Each option comes with its upsides and downsides — for
instance, users can block display ads and the average cost per click for Google Ads on
the search network is between $1 and $2 per click — so it’s important to set budgets
and goals before investing a ton of money into it.

Every small business owner is busy, but making time to promote your website is
important. You can have the best website in the world, but if you don’t drive traffic
to it, no one will know how great the site or your company is.

b. How can he meet the expectations of his online customers? (5 Marks)

Answer:

Meeting customer expectations isn’t always easy. But it certainly isn’t impossible,
either. Get to know your audience, make sure they’re the right audience for your
brand, and learn as much as you possibly can about their needs and goals.
Then, set clear expectations from the start, and make sure that current and
prospective customers always have the information they need to make informed
decisions.

Enable Convenient Shopping

Just like customer expectations, the desire for convenience has increased.
Hyperconnectivity and the widespread availability of 4G networks, coupled with
people’s busy lifestyles has led to an explosion in the growth of mobile e-Commerce.
Omnichannel interactions are now the norm and buyers tend to switch channels and
even devices before they make a purchase.
As an online seller you need to offer a flexible shopping experience. This not only
refers to your website but to all channels you are present on like Facebook or
Instagram and regardless of what device they are using.
Offering the option of in-store pick-ups, one-click shopping, recurring orders, voice
activated shopping, can all make life that little bit easier for your customers. If you
can change the way you interact with your customers so that it fits in with their
lifestyle you will create lasting loyalty.

Providing fast delivery

Fast delivery is one of the most crucial aspects of online shopping and it can make or
break a sale. Online marketplace giants like Amazon have heightened customer
expectations when it comes to fast delivery.
With the strong desire for immediacy, you can really differentiate yourself by
offering this type of service.
Consumers not only expect fast shipping but a variety of delivery options and
affordable prices. Delivering on these can build trust and loyalty. For example, online
shoppers still enjoy being able to order online but many still prefer to pick up their
orders in store. Almost 2 in 3 people have used Buy Online, Pick-Up in Store
programs. The main reasons for doing this is so they can avoid shipping fees,
immediacy and convenience.
By seamlessly blending the online and offline worlds, it improves the online shopping
experience and can increase your chances of closing a sale.

Ensure privacy protection

Online shoppers around the world have become more concerned about their privacy
and data protection while shopping online. With large scale data breaches from
companies such as Facebook, shoppers now expect a safe and secure shopping
experience.
If you don’t protect consumer data, you risk facing repercussions from regulators
and backlash from your consumers who say they will take their business elsewhere.
As an online seller you need to incorporate cyber security and privacy as part of your
strategy in order to gain the trust of potential and current customers.

Customer expectations have been steadily rising over the past two decades in line
with the growth of online retailing. Advancements in e-Commerce have created a
‘want it now’ environment and if online retailers cannot meet these expectations,
they won’t be able to keep up with their competitors from around the globe.