Republic of the Philippines CENTRAL LUZON STATE UNIVERSITY College Of

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Transcript of Republic of the Philippines CENTRAL LUZON STATE UNIVERSITY College Of

Republic of the Philippines CENTRAL LUZON STATE UNIVERSITY College of Business Administration and Accountancy Science City of Muoz, Nueva Ecija, 3121


Customer Relations Management of Supermarkets in San Jose City, Nueva Ecija



S.Y. 2009-2010

INTRODUCTION In order to compete effectively in the market, organizations must be customerfocused and because of this reason there is a need for an organization to establish a customer relationship management (CRM). Customer Relationship Management (CRM) is to create a competitive advantage by being the best at understanding, communicating,

delivering, and developing existing customer relationships, in addition to creating and keeping new customers. It has emerged as one of the largest management exhortation. In this era of fierce competition, both on a local and a global level, it becomes increasingly important to ensure that a business is "customer-centered. Organizations should realize that retaining customers is more profitable than crating a new customer. Providing good service and then finding a way to leverage the good will created by quality service a company can tie deeply into a consumers mind and develop a strong business/client relationship. However, technology as an enabler with very low cost has come to the rescue of organizations to meet ever-changing need of customers.

Objectives This study aims to: 1. Identify the reasons for customer complaints. 2. Enumerate the benefits of the organization in having CRM. 3. Find out the actions being undertaken by the management.

4. Determine the awareness of customers regarding the CRM of an organization.

Statement of the Problem General Problem: What are the importances of having a customer relationship management in an organization? Specific Problems: 1. What are the reasons for customer complaints? 2. What are the benefits of the organization in having CRM? 3. What are the actions being undertaken by the management? 4. How aware the customers regarding management of an organization? the customer relationship

Significance of the Study This study will clearly reveals the importance of a CRM in an organization especially in a supermarket and/or department stores. This study wants to inform the management of an organization that complaints are one of the most important forms of communication between a business and its customers, and constructive responses to

complaints can help retain customers who would otherwise be lost.

Conceptual Paradigm

INDEPENDENT VARIABLES Customer Relation Management Customer Services/Programs Customer Awareness Management


Customer Satisfaction Customer Dissatisfaction and Complaints Customer Relationship Consumer, and Management Benefits

Data Collection Method The data collection method being used in this research is interview method guided by constructed questionnaire that will answer the main purpose of the research. The approach that has been undertaken in doing the research is the purposive sampling, wherein the people interviewed by the researchers are the ones which are presently there

during the conduct of the interview. The people interviewed composed of customers who purchased in the supermarkets understudy and the managers of the said supermarkets.

Scope and Limitations The study is bound to know what current practices are of supermarket stores in San Jose City Nueva Ecija; the importance of customer relation management and the benefits and how to handle it.

Locale Supermarkets in San Jose City, Nueva Ecija constitutes the locale of this research. These towns are in Nueva Ecija in Central Luzon. The supermarkets that are involved in the research are the following: NE Bodega Supermarket, the CVC Supermarket, the Magic Supermarket, and the Friendship. the aforementioned supermarkets will be the ones in which the researchers will get the information that they need.


Evaluation of Customer Relationship Management

Customer Relationship Management (CRM) is to create a competitive advantage by being the best at understanding, communicating, delivering, and developing existing customer relationships, in addition to creating and keeping new customers. It has emerged as one of the largest management buzzword. Popularized by the business press and marketed by the aggressive CRM vendors as a panacea for all the ills facing the firms and managers, it means different things to different people. CRM, for some, means one to one marketing while for others a call centre. Some call database marketing as CRM. There are many others who refer to technology solutions as CRM. If so, what is CRM? Merchants and traders have been practicing customer relationship for centuries. Their business was built on trust. They could customize the products and all aspects of delivery and payment to suit the requirements of their customers. They paid personal attention to their customers, knew details regarding their customers tastes and preferences, and had a personal rapport with most of them. In many cases, the interaction transcended the commercial transaction and involved social interactions. Even today, this kind of a relationship exists between customers and retailers, craftsmen, artisans essentially in markets that are traditional, small and classified as pre-industries markets. These relationship oriented practices have changed due to industrial revolution. Businesses adopted mass production, mass communication and mass distribution to achieve economics of scale. Manufactures started focusing on manufacturing and efficient operations to cut costs. Intermediaries like distributors, wholesalers and retailers took on the responsibilities of warehousing, transportation, distribution and sale to final customers. This resulted in greater efficiencies and lower costs to manufacturers but brought in many layers between them and the customers. The resulting gap reduced direct

contacts and had a negative impact on their relationships.

Technological Advancement More information, communication and production technologies have helped marketers come closer to their customers. Firms operating in diverse sectors ranging from packaged goods to services started using these technologies to know their customers, learn more about them, and then build stronger bonds with them through frequent interactions. Marketers could gain knowledge about customers, which helped them respond to their needs through manufacturing, delivery, and customer service. Technology also enabled ordering and product-use related services. Though the emergence of CRM in recent times coincided with the information age, one must remember that technology is just an enabler. Technology enabled marketers overcome several long felt shortcomings of mass marketing. Some of these included:

- Inefficiencies of mass marketing: 1980s and early 1990s witnessed some of the most radical business transformations that resulted in cost reductions in almost all functional departments except marketing. Manufacturing and related operations costs were reduced through business process reengineering, human resource costs were reduced through outsourcing, restructuring and layoffs, financial costs were reduced through financial reengineering but marketing costs kept increasing due to increased competition and product parity in virtually every industry. - Lack of fast, effective and interactive models of customer contact, feedback and information.

- Lack of consolidated information about customer interactions, purchase behavior and future potential.

Intensive Competition In competitive markets, specially the ones that were maturing and witnessing slow or no growth, marketers found it more profitable to focus on their existing customers. Studies have shown that it costs up to 10-12 times more to attract a new customer than to retain an existing customer. Marketers have now started focusing on the lifetime value of customers. They are moving away from just trying to sell their products to understanding, customers needs and wants and then satisfying their needs. This has led to a relationship orientation which creates opportunities to cross sell products and services over the lifetime of the customer.

Growing Importance of the Service Sector The service sector contributes to over two-third of the GDP of most advanced economies. In India, the services sector contributes to over 50 per cent of the economy. One of the characteristics of the service industries is the direct interaction between the marketer and the buyer. In services, the provider is usually involved in the production as well as delivery directly. For example, professional service providers like a doctor or consultant are directly involved in production as well as delivery of their services. Similarly, the customers are directly involved in production in the purchase and consumption of these services. These direct contacts create opportunities for better understanding, a better appreciation of needs as well as constraints and emotional

bonding all of which facilitate relationship building. Therefore it should come as no surprise when you see the service firms pioneering many of the customer relationship initiatives. Firms operating in the financial services, hospitality business, telecom, and airlines are the early adopters and extensive users of CRM practices.

Adoption of total Quality Management (TQM) Programs Total quality management programs help companies offer quality products and services to customers at the lowest prices. To enable this value