Customer Relationship Management: Summary

Topics: Customer relationship management, Marketing, Customer service Pages: 7 (3224 words) Published: October 21, 2014

Definition CRM
CRM is a core business strategy that integrates internal processes and functions, and external networks, to create and deliver value to targeted customers at a profit grounded on high-quality customer-related data and enabled by information technology (book) Types of CRM

Strategic CRM: customer-centric business strategy
Dedicated to winning and keeping customers by creating and developing better value than competitors.Product oriented: customer choose products with best quality, performance, design etcProduction oriented: low price products Sales oriented: customers are persuaded by advertisement and sales promotions Customer – market oriented: uses customer and competitive information to develop better value propositions. – is a learning firm that constantly adapts to customer requirements and competitive conditions. Operational CRM: automation of customer-facing processes

Automates and improves customer facing and customer supporting business processes. Market automation: applies technology to marketing purposes. Sales force automation: applies the technology to the management of a company´s selling activities (provides a standardized view of the sales cycle and a common language for discussion of sales issues). Service automation: allows companies to manage their service operations: call centres, contact centre’s, web or face-to-face. Enables efficiency of users

Reducing service costs
Partner relationship management: Allows partners to communicate with suppliers through a portal to: manage leads, sales orders, information, incentives Analythical CRM: intelligent mining of customer-related data Focuses on the intelligent mining of customer-related data for strategic or tactical purposes.Build on the foundation of customer related information Essential part of CRM implementations

Helps makes decisions like:
Which customer to target
Focus of sales effort
Relative priority for customers and what level of service to offer. Collaborative CRM: application of technology across organizational boundaries Strategic and tactical alignment of normally separate enterprises in the supply chain for the more profitable identification of customers.Enables separate organizations to align their effort to service customers more effectively. Service:

The non-material equivalent of a good
Economic activity that does not result in ownership
The product is the act of delivery
Special attributes that characterize services: Intangible (Services which cannot be seen), variable (mechanically reproduced to exact specifications an tolerances, services cannot), perishable (Services cannot be held in inventory for sale at a later time), inseparable (service are produced at the same time and place ), difficult to evaluate, based on experience and credence Traditional customer service = do to the customer vs. Modern CRM = done with the customer Ongoing, cooperative and built for the long term

5 phases of CRM implementation

CRM models
IDIC modelSuggests that companies should take four actions in order to build closer one-to-one relationships with customers. Identify who your customers are and build a deep understanding of them Differentiate your customers to identify which customers have most value now and which offer most for the future. Interact with customers to ensure that you understand customer expectations and their relationships with other suppliers or brands Customize the offer and communications to ensure that the expectations of customers are met. CRM Value Chain by Francis Buttle’s model5 primary stages and 4 conditions which lead to the end goal of enhanced customer profitability.

Kottler’s 8-step Change Model

1: Create UrgencyFor change to happen, it helps if the whole company really wants it. Develop a sense of urgency around the need for change. This may help you spark the initial motivation to get things moving. 2: Form a Powerful CoalitionConvince people that change is necessary. 3: Create a...
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