Customer Relationship

Management (CRM)
 What is CRM?

“The approach of identifying, establishing, maintaining and

enhancing lasting relationships with customers.”

“The formation of bonds between a company and its

customers.”

According to Morgan and Hunt, “relational marketing is all

marketing activities directed toward establishing,
developing and maintaining successful relational
exchanges.”
 FROM RESEARCH IT IS FOUND THAT:
1. IT COSTS 6 TIMES MORE TO SELL TO A NEW CUSTOMER THAN
TO SELL TO AN EXISTING.
2. ONE DISSATISFIED CUSTOMER WILL TELL 8-10 OTHERS ON HIS
EXPERIENCE.
3. BY INCREASING THE CUSTOMER RETENTION RATE BY 5%,
PROFITS COULD INCREASE BY 85%
4. THERE IS 50% CHANCE OF MAKING A SALE TO AN EXISTING
CUSTOMER WHILE ONLY 15% CHANCE OF SELLING TO A NEW
CUSTOMER.
5. 70% OF CUSTOMERS WILL DO BUSINESS WITH THE COMPANY
AGAIN IF THEIR COMPLAINT IS SUCCESSFULLY RESOLVED.
6. 90% OF COMPANIES(IN 2000) DID NOT HAVE THE NECESSARY
SALES & SERVICE INTEGRATION TO SUPPORT E-COMMERCE.
 Transactional Marketing vs Relationship Marketing

Traditional Marketing CRM

1. Goal : Expand customer base, 1. Goal : Establish a profitable,
increase market share by mass long term, one-to-one
marketing. relationship with customers;
understanding their needs,
2. Product oriented view. preferences, expectations.
3. Mass marketing/mass 2. Customer oriented view.
production. 3. Mass customization, one-to-one
4. Standardization of customer marketing.
needs. 4. Customer supplier relationship.
5. Transactional relationship. 5. Relational approach.
 History of CRM

 1980s : Database marketing emerges.

 1980s : Database helped larger organizations rather than small
who only got survey type info.
 1990s : CRM appears as a two-way communication.
 1990s : CRM leads to programs such as frequent flyer miles
and bonus points on credit cards.
 2000s : Internet has helped expand from stagnant database and
allows off-site information storage.
 2000s : Used most frequently in financial services, high tech
corporations and the telecommunication industry.
 Goals/Objectives of Relationship Marketing

1. Building relationships.
2. Maintaining relationships.
3. Enhancement of relationships.
 Importance/Applications of Relationship Marketing
1. CRM is an integrated information system that brings together
information about customers, marketing effectiveness, sales
and market trends.
2. It enables business to combine technology and human
resources to understand the consumer behavior.
3. Relationship marketing uses improved information
technology to regularly interact with firm consumers and to
base product offerings on the consumer’s buying habits.
4. Relationship marketing can stop consumers switching to
another brand.
 Benefits of CRM

1. They are result driven. The firm must decide on specific goals and
benefits before attempting to implement a CRM strategy.
2. They communicate effectively across functions. Effective customer
relationship management depends on cross-disciplinary teams, such as
sales and customer service, that work together to solve customer
problems.
3. They are streamlined. A concentrated focus on the customers allow firms
to weed out wasteful business practices.
4. They provide a complete and up-to-date picture of the customer that is
easily shared within the company.
5. They help to identify new markets and sales opportunities.
6. They reduce response time and increase customer retention.
7. They constantly seek improvement .By tracking and measuring results,
firms can continuously improve relationships with customers.
 Four R’s in Relationship Marketing

1. Relationship
2. Realization
3. Response
4. Relevance and Respect
 Key CRM Principles

“Is a targeted mutually beneficial profitable relationship with individuals &

groups.”
1. Differentiate customers( between high value and low value customers)
2. Differentiate offerings( between high value and low value offer)
3. Key existing customers( 5-10% cheaper to retain than to acquire new
customers)
4. Maximize life time value( exploit up-selling & cross-selling potential)
5. Increase loyalty.
 CRM Cycle

Learning
from
customers
&
prospects
Acquiring
Creating
new
value
customers

Creating Creating
profits loyalty

Acquiring
new
customers
 Customer Retention Strategies

-Membership Benefits Structure Bonds

-Gifts -Integrating system with customers
- Discount Coupons -Making joint investment on
technology
Financial Bonds
-Sharing process or equipment

Continuous quality
service to customers
Social Bonds suit customers’ specific needs
- Special attention -Offering a combination of services that
-Informing customers about new - Personalizing service
services Customization Bonds
-Wishing customers on their
anniversaries
 Limitations of CRM

1. Experts explain that failures with CRM often result from

failure to organize or reorganize the company’s people and
business processes to take advantage of the benefits the CRM
system can offer.

2. Other problems arise when data are not input to the CRM
program accurately and on a regular basis.
 The Top 11 CRM Software Manufacturers Are :

COMPANY PRODUCT NAME

1. Microsoft Microsoft Dynamics CRM 3.0
2. Sage Software SalesLogix CRM
3. SAP America Inc. SAP Business One CRM
4. Parature Inc. Parature
5. Entellium Entellium CRM
6. Pivotal corp. Pivotal CRM
7. Maximizer Software Maximizer Enterprise CRM
8. Netsuite Inc. NetSuite CRM+
9. On contact Software ON contact V
10. ADAPT Software Applications ADAPT crm
11. Exact Software North America e-Synergy
 At The End

Choosing the right CRM helps client interaction

and understanding efficient initiating process
of better service and customer retention.

Thanks