1[2][1]. introduction to crm

8/8/2019 1[2][1]. Introduction to CRM

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CUSTOMERRELATIONSHIPMANAGEMENT

PGDM(CRM)2007-09 BATCH

Apeejay School of Management


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Free template from www.brainybetty.com 2

Relationship Marketing

Your most unhappy customers areyour greatest source of learning

Bill Gates


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What is

?

The true business of

every company is tomake customers,

keep customers, and

maximize customer

profitability


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Transaction & Relationship Marketing

Transaction RelationshipOne of exchanges

Focus

Ongoing exchanges

Brand Management CustomerManagement

Short time Focus TimePerspective

Long time Focus

Mass Communication PrimaryCommunication

Personal Communication

Isolate Marketresearch

Customerfeedback

Mechanism

Ongoing Dialogue

Mass Markets/ Market

Segments

Market Size Markets of One

Market Share CriterionofSuccess

Mind Share (Share ofCustomers)

Profitability ofTransaction Critical Metrics

Lifetime value ofCustomers

Brand Equity Customer Equity


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Directing Marketing

Business Paradigm and the Value Aspect

Developing Market-Driven Organization

and Strategies

Role of Market Research and Creation ofMarkets

Limitation of Convention Marketing

Definition Limitation of Marketing Mix (4Ps)


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towards Relationships

Fallacy of Competition Analysis

Focus on Value Equity

Managing Customer as an Asset Focus on Knowledge

Management and Experience

Impact of Electronic Channels Frozen Services


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ExchangePerspective

RelationshipPerspective

Value Distribution

Value Creation

Outcome

Process

Seth & Parvatiyar

The Paradigm Shift in

Marketing Orientation


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RELATIONSHIP

TECHNOLOGY

BUSINESS PROCESS

VALUE

VALUE

Value chain- process of

Customers

Seth & Parvatiyar


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Impact of Technology on

Modern Marketing

Seth & Parvatiyar

Increased

Competition

Relationship

Marketing

more Affordable

& Effective

NewTechnology

Development

GreaterDemand

for

Relationship

Marketing

Marketing

Evolution

IT Revolution

Changing

Customers


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Adopting Relationship Marketing

Advantages of Relationship Marketing Means to reduce costs and improve marketingeffectivenessManpowercost have been reduced by re-engineering,automation and downsizing.Financial restructuring and efficient have reducedfinancial costsTQM, JIT and FMS have reduced Operations costs

RESEARCHSHOWS THAT TODAY MANUFACTURINGCOSTS HAVE REDUCED FROM 55 TO 30 PERCENT ANDMANAGEMENT COSTS FROM 20 TO 55 PERCENT, BUTTHE MARKETING COSTS HAVE INCREASED FROM 20 TO55 PERCENT


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Advantages of Relationship Marketing Means to reduce costs and improve marketing

effectiveness

THE PRACTICE OF RELATIONSHIP MARKETING HAS THEPOTENTIAL TO IMPROVE MARKETING PRODUCTIVITY

THROUGH IMPROVED MARKETING EFFECIENCIES ANDEFFECTIVENESS

THE BENEFITS COME THROUGH LOWER COST OFRETENTION AND INCREASED PROFITS DUE TO LOWERDEFECTION RATE.

IT TAKES FIVES TIMES MORE TO AQUIREA NEW

CUSTOMER THAN TO RETAIN AN EXISTING ONE.


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Practicing Relationship Marketing Developing a core service around which to

build customerrelationships.

Customizing the relationship to individual

customer Augmenting the core service with extra

benefits

Pricing services to encourage customer

loyalty, and Marketing to employees so that they perform

well for customers.


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Basis of Building Relationship

TREATING CUSTOMERS DIFFERENTLY

INFORMATION BASED DECISIONS

CUSTOMER CENTRIC

FLEXIBILITY


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Forming a Relationship

Seth & Parvatiyar

SELLER/

PRODUCER

END BUYER/

USER

MUTUAL

TRUST

COMMITMENT

CONNECTIVELINKS

Information

Social

Process


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Defining Relationship

Mark

eting ConceptsMARKETING IS TO ESTABLISH,MAINTAIN, AND ENHANCERELATIONSHIP WITH CUSTOMERS

AND OTHER PARTNERS AT A PROFIT,SO THAT THE OBJECTIVES OFPARTIES INVOLVED ARE MET. THISIS ACHIEVED BY MUTUAL EXCHANGE

AND FULFILLMENT OF EXCHANGES

GRONROOS


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Defining Relationship

Mark

eting Concepts THE PROMISE CONCEPT

RELEVANCE OFTRUST

THE HOUSE OF

KNOWLEDGE INRELATIONSHIP MARKETING

PROCESS VIEW OF RELATIONSHIPMARKETING

COOPERATIVE VIEW OFRELATIONSHIP MARKETING

ROLE OF MARKETING ORIENTIATION


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The House of Knowledge in Relationship Marketing

Seth & Parvatiyar

Relationships Culture & Climate

INTERACTION

&

DIALOGUE

TRUST COMMITMENT

Knowledge

Knowledge Management

FirmStake-

holder


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Process View of Relationship Marketing

Relationship Mark

eting is system-oriented; but includes managerialaspects too.

Systems Approach suits to the basic

tenets of Marketing. It includes allrelevant actors, marketingenvironment and even the process ofmarketing.

Managerial Facets facilitate theactionable and normative elementsthat are required in such a theory


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Basic tenets of Mark

eting1. The market behaviour

2. The market transaction as aunit of analysis

3. The marketing as a dynamicprocess ofrelationship betweenbuyers and sellers

4. The exogenous variables thatinfluence the market behaviour

Cont.


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In thisrespect what is

requi

redis the raison d etreof

marketing, a perspective thatis common cause that no

stakeholder (consumer, seller,government, or social critic)can question. Indeed, that

perspective should really reflectwhat marketing is all about.

Seth (et.al)


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Marketing is a process that includesseveral parties.

Objective of each party is to be met andis done by mutual exchange andfulfillment of promises (TRUST)

These parties form an interactive networkthat further interacts with customers andenvironmental actors.

Relationship Marketing is dynamic

because of its process nature.Gronroos


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Cooperative View of RelationshipMarketing

Relationship Marketing is concernedwith cooperative and collaborativerelationship between firm andcustomers.

Relationship is formed betweenFirm and one ormany of itscustomers , including

End Consumer Distributors orChannel Members

B2B Customers


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Cooperative View of RelationshipMarketing

Thus Relationship Marketing is

An ongoing process of engagingin cooperative and collaborative

activities, and programs withimmediate and end-user

customers in order to create orenhance mutual economic value

at a reduced cost.


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SERVICE COMPETITION

Relationship makes Customerless Price Sensitive

Monitoring CustomerSatisfaction

Customer Perceived Quality(Technical &Functional)

CustomerFeedback CustomerComplaint Tracking

(CCT)


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StrategicImportance of

INTRAORGANIZATIONAL COLLABORATION

Level of interdependence dependswhether the Organization has chosenTransaction Based Strategy or a

Relationship Based Strategy Transaction Strategy relates more to

Product and traditional Marketing mix

Customer Interface is an essential

component ofRelational Marketing Customer Interface involves a

broader scope for par-time marketersof other functional areas.


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Prerequisite

INTERNAL MARETING FOREXTERNAL MARKETING

PRODUCER

Internal External

Marketing Marketing

EMPLOYEE Interactive CUSTOMER

Marketing

CRM

1[2][1]. introduction to crm

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