Post on 09-Mar-2016
description
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Customer Relationship
Management-Introduction
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Marketing History
• 1940: efort toards marketing o!manu!actured goods
• "0-90:shi!t toards ser#ice $asedcompanies
• %000:e&perience economy
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'nderstanding the shi!t
Exchange Paradigm Relational Paradigm
(ime )erspecti#e *hort )rolonged
Mktg +unction Marketing mi& Interacti#e marketing
,uality imension )roduct .uality/customersatis!action .uality
,uality o! e&perience
Metrics Market share *hare o! allet !ocus
Interdepartmentalsupport
o High
Internal Marketing egligi$le 2ery high
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Relationship orientation of marketing in different era (Adopted from Sheth and
Parvatiyar, 1995)
Is relation in $usiness ne phenomenon3
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Paradigm Shift
• )re-industrial era-Trust, trade within clans,silk route, early branding
• Industrial era -IR, mass production, shift in jobs,mktg institutions, metrics like sales,revenue, MS, protability!
• )ost industrial era -comple" products,service economy, #$M
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*hi!t continues55
• (he 4-) paradigmin#ol#es marketing toanonymous masses o!customers
• (he relationshipmarketing paradigm in:
– industrial marketing – ser#ices marketing
– managing channel
– strategic alliances
– 6%6 marketing
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Relationship Marketing
RM dras attention to the importance o! retaining
as ell as attracting customers/ ith emphasis$eing placed on the de#elopment o! long term
relationships ith customers5
)rimary goal o! RM is to $uild and maintain a$ase o! committed customers ho are pro7ta$le!or the organi8ation5
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Customer i!e Cycle
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6onding !or
Customer Relationship
e#el 1: +inancial $onds
%olume and fre&uency of rewards5
e#el %: *ocial 6onds
'ersonal relationships, continuous and social bonds!
e#el :Customisation $onds
Customer intimacy mass customi8ation
e#el 4 *tructural $onds
oint in#estments shared processes and e.uipment
6erry ; )arasuraman<1991=
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Customer oyalty >&ercise
• (hink o! a ser#ice pro#ider to hom youare loyal5
• ?hat do you do <your $eha#iors/ actions/!eelings= that indicates you are loyal3
• ?hy are you loyal to this pro#ider3
• ?hat !actors ha#e in@uenced the!ormation o! your loyalty3
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RM to CRM
• CRM and Relationship Mktg5 term usedinterchangea$ly in academics5<)ar#atiyar ; *eth %001=
• CRM is more a$out informationenabled relationship marketing5<Ryals ; )ayne %001=
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)ractitionerAs #ie
+orrester says that CRM is the $usiness processesand supporting technologies that support the keyacti#ities o!: targeting/ ac.uiring/ retaining/understanding/ and colla$orating ith customers5
Customer relationship management <CRM) is a$usiness strategy ith outcomes that optimi8epro7ta$ility/ re#enue and customer satis!action$y organi8ing around customer segments/
!ostering customer-satis!ying $eha#iors andimplementing customer-centric processes5 CRMtechnologies should ena$le greater customerinsight/ increased customer access/ more-
efecti#e interactions/ and integrationthroughout all customer channels and $ack-
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?hat researchers say
CRM is the core $usiness strategy that integrates
internal processes and !unctions/ and e&ternalnetorks/ to create and deli#er #alue to targetedcustomers at a pro7t5 It is grounded on high.uality customer related data and ena$led $y I(
(rancis )uttle *++
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e7nition5
CRM is a comprehensi#e strategy and process o!ac.uiring/ retaining and partnering ith selecti#e customers to create superior #alue !or thecompany and the customer5 It in#ol#es theintegration o! marketing/ sales/ customer ser#ice/and the supply chain !unctions o! the organi8ationto achie#e greater eciencies and efecti#enessin deli#ering customer #alue5 'arvatiyar . Seth*++/0CRM is the practice o! analy8ing and utili8ing
marketing data$ases and le#eragingcommunication technologies to determinecorporate practices and methods that illma&imi8e the li!etime #alue o! each indi#idualcustomer to the 7rm %! #umar,1erner
2! Reinart30
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ink 6eteen CRM and Customer 2alue
Customer 2alue: (he economic
value o! the customer relationship
to the 7rm E e&pressed on the $asis
o! contri$ution margin or net pro7t
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)ro7t Denerated $y a Customer F#er (ime
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)ro7t Impact o! G )ercent Increase inRetention Rate
Source: +5 +5 Reichheld/ oyalty and the Renaissance o! Marketing/ Marketing Management, #ol5 %/ no5 41994 5 1G5
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(he Customer )yramid
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Misunderstandings a$outCRM
• CRM is data$ase marketing
• CRM is marketing process
• CRM is an I( issue• CRM is a$out loyalty schemes
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>J6>R* +FR (H> DRF?(H F+ CRM
%1
Emergence of service economy
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Market Maturity
%%
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Misalignment $eteen Re#enueand )ro7t
%