ABSTRACT CRM (Customer Relationship Management) is an integrated approach to identifying, acquiring, retaining and delighting customers. The purpose of this thesis is to analyze the impact of Customer Relationship Management Process on Customer Retention with reference to Banking Sector. We describe the objectives of Customer Relationship Management (CRM) in Customer Retention which is very important for the survival of companies in today’s competitive environment. CRM helps organizations maximize the value of every customer interaction and drive superior corporate performance. The challenge is to make it easy for customers to do business with the organization any way they want at any time, through any channel, in any language or …show more content…
On the other hand, in the world of relationship marketing, attention shifted to retention. This happened mainly because of the cost involved. In general, it is believed that “it is five to 10 times more expensive to acquire a new customer than obtain repeat business from an existing customer.”As the needs of customers became diversified, conventional promotions became less efficient and drove up costs. According to the well-known empirical “Pareto principle,” it is assumed that 20 percent of a company’s customers generate 80 percent of its profits.2 In other words; retention of a large customer base is a major issue. Birth of Customer Relationship Management In this context, CRM came into existence in the late 1990’s. Although there is no clear definition of CRM, Jeffrey Peel, CEO of Quadriga Consulting, defined it as follows: [CRM] is about understanding the nature of the exchange between customer and supplier and managing it appropriately. The exchange contains monetary considerations between supplier and customer – but also communication. The challenge to all supplier organizations is to optimize communications between parties to ensure profitable long-term relationships. CRM is a key focus for many organizations now as a shift away from customer acquisition toward customer-retention and churn reduction strategies dictates a need for best practice CRM processes. “Share of Wallet” and Life Time Value In the age of target
CRM systems consist of history purchase and information of customers. It can help track customer more easily. It can reduce the process time and increase productivity.It will resist the activities of competitors attempting to attract customers’ patronage. Customers will loyal and would not switch
The most effective Customer Relationship Management (CRM) systems are deliberately designed to align and enhance the strategic initiatives and programs of a given business or enterprise. They must take into account customer preferences, needs and wants as well, and strive to create a foundation of shared information and insight over time There are a myriad of studies that show how effective CRM systems are in transforming businesses and making them more customer-centric, profitable and responsive to rapidly changing market requirements. The level of adoption and continued use of CRM systems also assures a company's culture stays agile enough to respond to changing market conditions while also keeping the level of expertise and knowledge about customers continually growing (Chen, Chiu, 2010). Having a single system of record pertaining to all customer interactions give companies a competitive advantage in that they have greater insight into how prospects make buying decisions (Wang, Feng, 2012). When implementing a CRM system there are five critical success factors that are essential to its success and these include cost, risk, scope, time, and quality. The most effective CRM implementations that deliver the greatest value balance all five of these factors and synchronize them together to create strategies that deliver consistently profitable results. These five critical success factors are essential
Before taking a look at CRM from a technological standpoint, a historical perspective is instructive. CRM is still relatively young. It emerged during the rise of personal computers. It was a time where personal productivity was becoming vogue. At this time a plethora of software products were being designed to serve individual users but these programs did not have much to do with CRM. These early management systems were designed to automate a single segment of the customer life cycle. It wasn’t yet common knowledge at the time that an improved way to offer customers a seamless view is to integrate all tasks in order to provide a cohesive process. Today businesses know that in order to achieve a seamless flow of information a good integration strategy is required. A study conducted by Frederick Reichheld showed that dramatic increase in profits stemmed from small increases in the rate of a customer retention. Other studies report that repeat customers generate over twice as much gross income than new customers (Winer 2001). On the whole, the school of thought has changed from customer acquisition to retention, but it took several years for this goal to be actualized through the use of capable CRM
The CRM involves gathering data for sales activates and organization by using information system technology. Also, being a crucial tool, CRM helps customers with their needs by making technical and customer support easier. The main goals of a CRM system are, getting new clients and customers, and reducing the cost of sales. With successful implementation of CRM, it allows processes, technology, and even people to work together to help increase profitability while decreasing operational
Customer relationship management is a business strategy that attempts to ensure every customer interaction that is appropriate and consistent regardless of the communication channel and that CRM is a core business strategy for managing and optimizing customer interactions across the public or private’s institutions’ traditional and electronic interfaces. CRM can be used to gain clearer insight and more intimate understanding of customers' behaviours and in helping to build an effective competitive advantage and its relationship to the e-business process (Khirallah 2000) and that committed customers can be viewed as company assets who are likely to be a source of favourable referrals and are more resistant to competitors' offers (Khirallah 2000).
Using a CRM program is an effective tool to track of core customers’ needs and wants then individualize those needs with your products and services that match those needs. Moreover, the CRM program can keep track of contact,
Today, customer relationship management is very important to the business world. Most of the companies established a department and the programs to manage their relationship with the customers. Customer relationship management (CRM) is a business strategy which designed to help a company to understand and look forward to the needs of its potential and current customers (Anderson & Stang, 2000). Customer data is being collected in several different areas of the company, stored in a central database, analyzed, and distributed to key points (Anderson & Stang, 2000).The business world once was “product-centric”, the companies just provided what they could produce. However, it is now become “customer-centric”, they provide products and service
Today CRM is a method of retaining and developing customers through increased loyalty and satisfaction. The service, quality and relationship experience are the one greatest competitive aspect for a Business’s survival.
In order to establish a suitable CRM system and increase the success rate, understanding CRM processes is especially important. Building CRM system, there are many works need to do(). Firstly, the target customer market should be identified. Different customer strategies are focused on different target customer markets based on their profitability. Then, firms set customer objectives, for example, acquire customer satisfaction and loyalty. After that, the leaders and managers should support and commit the implementation of a CRM system. At the same time, when companies change their targets, a plan about changing
Introduction:Businesses has grown on fast pace in last few decades. This rapid growth in business ha snot only increased the competition but also provided the customers to choose from the products .increased competition and market uncertainty has left organization to think the ways to retain and attract more and more customers. Wining the heats and minds of customers is now the ultimate goals of much organization to earn profitability. (Kicaid, 2003) It is because organizations know a satisfied customer can refer many new customers to them with no cost of marketing. Customer
Customer Relationship Management (CRM) is significant in the service marketing these days, customers are the major element that relates to the company growth and profits. Understanding the customer purchase behavior and relationship is a key of success that commonly indicates the B2B & B2C relationship management. CRM system provides the customer information that shows what customer wants and needs, and help sales person to increase the customer relationship with the organization. Besides, customer relationship management is used in the business and marketing strategies extensively by segment and targeting the major customer groups. The system presents the customer needs and performances that can help the company to attract the new customer, increase customer satisfaction, reduce the customer manage cost and increase sales productivity.
Customer Relationship Management (CRM): Customer relation management (CRM) is a cross functional enterprise system that computerizes numerous customers serving form in direct marketing, sales, customer service and accounting management. CRM allows a company to distinguish and focus on their best customer so that they can be held as a loyal customer for a longer period of time.
CRM (Customer Relationship Management) is an information industry term for methodologies, software, and usually Internet capabilities that help an enterprise manage customer relationships in an organized way. For example, an enterprise might build a database about its customers that described relationships in sufficient detail so that management, salespeople, people providing service, and perhaps the customer directly could access information, match customer needs with product plans and offerings, remind customers of service requirements, know what other products a customer had
In this way best customer has been serve best way and in case of uninterested customer leads to their dissatisfaction and eventual defection.
Customer relationship management (CRM) is widely implemented and centralized system which offers a place for interaction under a company. An employee can handle again the repeated problem which occurred in the past by re-investigate it. Besides, CRM provides a place to identify what customers wants. Employees can track customer’s expectation by their feedback and communication that can improve their buying experience and stay interact with customer in order to understand their true needs.CRM also has ability to let the company see the customer interaction in clear picture. Different customers from different segments require different products and services, but this complex situation can handle well by CRM. Furthermore, CRM provides quality and efficiency system in the company management that helps company achieves their success by building long-term customer relationship.