Introduction to Customer Relationship Management Free Essay Example

Discuss briefly about customer retention strategies in customer relationship management. The various customer retention strategies are: A. Reducing Attrition Virtually every business loses some customers, but few ever measure or recognize how many of their customers become inactive. Most businesses, ironically, invest an enormous amount of time, effort and expense building that Initial customer relationships Then they let that relationship go unattended.

In some cases even losing interest as soon as the sale been made, or even worse, they abandon the customer as soon as an easily remedied problem occurs, only to have to spend another small fortune to replace that customer.

The easiest way to grow your business Is not to lose your customers. Once you stop the leakage, It’s often possible to double or triple your growth rate because you’re no longer forced to make up lost ground Just to stand still. B.

Sell and then sell again So many people do an excellent Job of making the initial sale, then drop the ball and get complacent, Ignoring the customer, while they chase more business.

Your selling has actually only Just begun when someone makes that Inhalant purchase decision cause virtually everyone is susceptible to buyer’s remorse. To lock in that sale, and all of the referrals and repeat business that will flow from it, you need to strike while the iron is hot to allay your customers’ fears and demonstrate by your actions that you really care.

You should thank them and remind them again why they’ve made the right decision to deal with you and put a system in place to sell to them again, and again, constantly proving that they made the right decision.

C. Bring back the “lost sheep” There’s little point In dedicating massive resources to generating new customers hen 25-60% of your dormant customers will be receptive to your attempts to regenerate their business if you approach them the right way, with the right offer. Reactivating customers who already know you and your product is one of the easiest, quickest ways to Increase your revenues.

Re-contacting and reminding them of your existence, finding out why they’re no longer buying, overcoming their objections and demonstrating that you still value and respect them will usually result in a tremendous bounty of sales and drastically increased revenues in a matter of days and will lead to some of your best and most loyal customers. D. Frequent Communications Calendar Avoid losing your customers by building relationships and keeping in touch using a events, phone calls, “thank yoga’s”, special offers, follow-ups, magic moments, and cards or notes with a personal touch etc. Hat occur constantly and automatically at defined points in the pre-sales, sales and post-sales process. People not only respond to this positively, they really appreciate it because they feel valued and important. It acknowledges them, keeps them informed, offsets post-purchase doubts, reinforces the reason they’re doing business with you and makes them feel part of your equines so that they want to come back again and again. E. Extraordinary Customer Service The never-ending pursuit of excellence to keep customers so satisfied that they tell others how well they were treated when doing business with you.

Moving the product or service you deliver into the realm of the extraordinary by delivering higher than expected levels of service to each and every customer. Key facets include: dedication to customer satisfaction by every employee; providing immediate response; no buck passing; going above and beyond the call of duty; consistent on- mime delivery; delivering what you promise before AND after the sale; a zero-defects and error-free-delivery process and recruiting outstanding people to deliver your customer service.

Extraordinary service builds fortunes in repeat customers, whereas poor service will drive your customers to your competition. F. Courtesy system A powerful system that improves the interpersonal skills of your team and changes the spirit of your organization. It involves speaking to colleagues politely and pleasantly, without sarcasm or parody, and treating them at least as well as you loud want them to treat your customers. This will help your team to feel worthwhile and important, which makes for pleasant social contacts at work.

It also motivates them to provide extraordinary service, encourages them to be consistently pleasant in all of their dealings and to relate to customers in a warm, human and natural manner. This results in better, warmer, stronger, more trusting relationships and longer term bonds with your customers. G. Product or service integrity Long-term success and customer retention belongs to those who do not take ethical shortcuts. There must always be total consistency between what you say and do and what your customers experience.

The design, build quality, reliability and serviceability of your product or service must be of the standard your customers want, need and expect. Service integrity is also demonstrated by the way you handle the small things, as well as the large. Customers will be attracted to you if you are open and honest with them, care for them, take a genuine interest in them, don’t let them down and practice what you preach and they will avoid you if you don’t 2. Explain briefly ups of marketing Mix. The ups of Marketing Mix are: I.

Product To begin with, develop the habit of looking at your product as though you were an outside marketing consultant brought in to help your company decide whether or not it’s in the right business at this time. Ask critical questions such as, “Is your current product or service, or mix of products and services, appropriate and suitable for the The second P in the formula is price. Develop the habit of continually examining and re-examining the prices of the products and services you sell to make sure they’re still appropriate to the realities of the current market.

Sometimes you need to lower your prices. At other times, it may be appropriate to raise your prices. Many companies have found that the profitability of certain products or services doesn’t justify the amount of effort and resources that go into producing them. By raising their prices, they may lose a percentage of their customers, but the remaining percentage generates a profit on every sale. Could this be appropriate for you? Iii. Promotion The third habit in marketing and sales is to think in terms of promotion all the time.

Promotion includes all the ways you tell your customers about your products or revises and how you then market and sell to them. Small changes in the way you promote and sell your products can lead to dramatic changes in your results. Even small changes in your advertising can lead immediately to higher sales. Experienced copy;Ritter can often increase the response rate from advertising by 500 percent by simply changing the headline on an advertisement. Large and small companies in every industry continually experiment with different ways of advertising, promoting, and selling their products and services.

And here is the rule: Whatever method of racketing and sales you’re using today will, sooner or later, stop working. Sometimes it will stop working for reasons you know, and sometimes it will be for reasons you don’t know. In either case, your methods of marketing and sales will eventually stop working, and you’ll have to develop new sales, marketing and advertising approaches, offerings, and strategies. Lb. Place The fourth P in the marketing mix is the place where your product or service is actually sold.

Develop the habit of reviewing and reflecting upon the exact location where the customer meets the salesperson. Sometimes a change in place can lead to rapid increase in sales. You can sell your product in many different places. Some companies use direct selling, sending their salespeople out to personally meet and talk with the prospect. Some sell by telemarketing. Some sell through catalogs or mail order. Some sell at trade shows or in retail establishments. Some sell in Joint ventures with other similar products or services. Some companies use manufacturers’ representatives or distributors.

Many companies use a combination of one or more of these methods. V. Packaging The fifth element in the marketing mix is the packaging. Develop the habit of standing back and looking at every visual element in the packaging of your product or service through the eyes of a critical prospect. Remember, people form their first impression about you within the first 30 seconds of seeing you or some element of your company. Small improvements in the packaging or external appearance of your product or service can often lead to completely different reactions from your customers.

With regard to the packaging of your company, your product or service, you should think in terms of everything that the customer sees from the first moment f contact with your company all the way through the purchasing process. V’. Positioning The next P is positioning. You should develop the habit of thinking continually about think and talk about you when you’re not present? How do people think and talk about your company? What positioning do you have in your market, in terms of the specific words people use when they describe you and your offerings to others? Ii. People The final P of the marketing mix is people. Develop the habit of thinking in terms of the people inside and outside of your business who are responsible for every element of your sales and marketing strategy and activities. It’s amazing how many entrepreneurs and businesspeople will work extremely hard to think through every element of the marketing strategy and the marketing mix, and then pay little attention to the fact that every single decision and policy has to be carried out by a specific person, in a specific way.

Your ability to select, recruit, hire and retain the proper people, with the skills and abilities to do the Job you need to have done, is more important than everything else put together. 3. Explain the stages in new service development and its implementation. STAGES OF NEW SERVICE DEVELOPMENT IDEA GENERATION The new service development process starts with the search for ideas. New service ideas can come from customers, competitors, employees, interacting with various groups or top management. There was a brain storming session conducted by the company with the top management discussing about various customer requirements.

Various informal sessions were also conducted where customers talked about their needs and wants. Thus various ideas were generated. IDEA SCREENING The basic need for idea screening is to eliminate poor ideas as early as possible cause with each service development step, the cost of development rises. All the ides were submitted to the idea manager which was then reviewed by the idea committee. The ideas were then divided into groups of promising ideas, marginal ideas and rejects. The idea in the group of promising ideas was then researched by the committee.

The committee reviewed the idea against set criteria like: a) a) Will the service meet a need) b) Can the service be appropriately advertised) c) Does the company have enough capital for the service? CONCEPT DEVELOPMENT In this stage the service had to be described in detail. The company needed to develop a concept about the service to describe it to its customers To develop a concept for this service the company had to think about many questions like- who will use this service?? Teenage girls or would be brides. Second, what benefit will it provide them?

Better adjustment after marriage or experience sharing about married life. Third, when will people use this service? After being engaged, after graduation or after marriage. After considering various questions for developing a concept for the service, our company finally formed the concept of Dan opportunity for would be rides who want overall knowledge and experience sharing about marriage life for leading happy married life. O CONCEPT TESTING Concept testing involves presenting the service concept to appropriate target final service, the better it is.

Concept testing involved elaborating the customers upon the concept of the service and getting their reactions and acceptability of the service. We elaborated on the concept as providing services that will help girls who are about to get married to learn about the various aspects of being married and leading a happy married life by training them on handling relationships, time management, arsenal grooming, adapting to new cultures in case of inter caste marriages, wedding planner and many more.

BUSINESS ANALYSIS After the management developed the service concept and tested the feasibility of the service, it prepared a sales, cost and profits projections to analyze the entire service. Estimating total sales: Sales in term of this service would mean as to how many people avail this service and enroll for such programs. This is a repeated purchase service I. E. People keep getting married and thus customers demanding such a service will not go down torero. So sales are estimated to be favorably good in this mind of a service.

Estimating costs and profits: The initial cost of this service would include the cost of advertising and marketing the service, hiring teachers and experienced work staff to train the people homegrown and collaborating with various people who will be needed to ultimately plan the wedding for their clients. Profits are expected to be fairly good because as in a country like India where people spend lavishly for weddings, profits are expected to be good over a period of some time.

MARKET TESTING After the management was satisfied with the concept of the service and the business aspect of it, they decided to go for market testing where the consumers are offered the product and its acceptability can be checked. We went in for alpha testing where we tested our service within our organization. We went to few of our friends and one of our relative who were about to get married and explained them about our concept. The customers we approached towered quite excited about this service and wanted to enroll for it.

COMMERCIALISM’S Now is the time to finally launch the service in the market. Before the service is launched in the market, several decisions are to be taken like: 4. Discuss the GAP model briefly The GAP model The figure below shows the “GAP” model of service quality from Paranormal et al. (Chatham & Bitter 1996). This model offers an integrated view of the consumer- company relationship. It is based on substantial research amongst a number of service providers. In common with the Gar¶morons model it shows the perception gap (Gap 5) and outlines contributory factors.

In this case expected service is a function of word of mouth communication, personal need and past experience, and perceived service is a product of service delivery and external communications to consumers. However the GAP model goes further in its analysis of these key contributory factors. It not only provides a more rigorous description of the contributory Gaps, it lists key drivers for each gap and generic breakdown of each of these drivers. These are illustrated below in summary form below.

Gap I 0 Lack of upward communication I 0 Insufficient relationship focus I Gap 2 | * Absence of customer driven standards 0 Inadequate service leadership I 0 Poor service design I Gap 3 | * Deficiencies of human resource policies I 0 Failure to match supply and demand I 0 Customers not fulfilling roles I Gap 1 Ineffective management of customer expectations 0 Overprinting I 0 Inadequate horizontal communications I 0 Key factors in the GAP model (Estimate 1990) This level of detail allows powerful analysis of the contributory factors to a perception gap at a practical level.

The model shows the importance of marketing, business leadership quality and HRS systems in the management of the expectation gap. 5. Discuss about the marketing of services in Banking sector, Airline Industry,Hospitality sector. Marketing approach in banking sector had taken significance after 1950 in western countries and then after 1980 in Turkey. New banking perceptiveness oriented toward market had influenced banks to create new market. Banks had started to perform marketing and planning techniques in banking in order to be able to offer their new services efficiently.

Marketing scope in banking sector should be considered under the service marketing framework. Performed marketing strategy is the case which is determination of the place of financial institutions on customers’ mind. Bank marketing does not only include service selling of the bank but also is the function which gets personality and image for bank on its customers’ mind. On the there hand, financial marketing is the function which relates inconsequential, differences and non similar applications between financial institutions and judgment standards of their customers.

The reasons for marketing scope to have importance in banking and for banks to interest in marketing subject can be arranged as: Change in demographic structure: Differentiation of population in the number and composition affect quality and attribute of customer whom benefits from banking services. Intense competition in financial service sector: The competition became intense due to the growing international banking receptiveness and recently being non limiting for new enterprises in the sector. Increase in liberalizing of interest rates has intensified the competition.

Banks wish for increasing profit: Banks have to increase their profits to create new markets, to protect and develop their market shares and to survive on the basis of intense competition and demographic chance levels. The marketing comprehension that are performed by banks since 1950 can be shown as in following five stages: 2. Marketing comprehension based on having close relations for customers 3. Reformist marketing comprehension 4. Marketing comprehension that focused on specializing in certain areas 5. Research, planning and control oriented marketing comprehension 6. Write a short notes on: A.

Pricing strategies of service. B. Roles played by the customers during service delivery- The role for the customers in the service delivery There are three types of roles for the customer in the service delivery process. The customer can be a productive resource, a contributor to quality and satisfaction or a competitor in the service delivery process. Example: For the service Amtrak expects the customer to take part as a productive source in the service delivery process to gain a better. For Amtrak it is clearly most effective for a customer to get the tickets from the QuickTime machine.

There is simply no labor involved other than that of the customer himself. The second best way for Amtrak is if the customer orders his tickets online. This way, few employees are needed to send the tickets to the customers’ address. The last and most ineffective way for Amtrak is if the customer makes his purchase at the ticket booth at the train station. Amtrak needs to employ people to sit behind the counter and help the customer. This brings also the risk of complaints and lowering the customers’ perception of the service delivery. They totally depend on the person behind the ticket booth and blame that person for any mistakes.

Although the customer still needs to provide the cashier with the necessary information. This leads to the second customer role. The customer can also has to contribute to the quality and satisfaction. The customer will be more satisfied if they think that they have done their part in the service delivery. Therefore it is advisable to involve the customer. By online and QuickTime purchases the customer is fully involved. The customer needs o find out when and where he wants to go. What level of comfort he desires. If he wants to eat on the train, what he wants to eat. These are all examples of decisions that the customer is involved in.

The third and last is viewing the customer as competitor. By answering the critical factors we can see that there is a way that the customer can be seen as a competitor. The customers’ ultimate goal is to get from point A to point B. There are few different options. The train is one and others might be going by car or taking a airplane. Factor I Explanation I Expertise capriciousness capacities specification redisplaying reduplication’s I The expertise capacity of the customer is likely not to be that good that he can produce the service of the train trip himself.

Other options to go from point A to B are therefore important. The recourses of duplication are low. A car most likely. A plain is again a good option. Elf there is no expertise or resource for duplication it is not likely that time will be a critical factor. However the time aspect can be seen in the options again. The train is quicker than the car but not quicker than the plane. Other options such as the car might prove to be cheaper. A plane is generally more expensive. The psychic reward does not play any role here.

The degree of confidence or certainty the customer has in the various options. So what confidence does the customer has in options such as the car or the plane. The control level will be higher for the customer if he chooses to go by car. The level of control will be lower if he chooses the plane. I We can conclude that there is a certain form of viewing the customer as a competitor. If the critical factors associated with the external or internal exchange are reviewed, the conclusion is that the customer fulfils his role as a competitor by evaluating its options on substitution possibilities.