Concepts of Customer Relationship Management (CRM)

Concepts of Customer Relationship Management (CRM) Happy customers tell 4 to 5 others of their positive experience. Dissatisfied customers tell 9 to 12 how bad it was Quotes Mark Steven. This quote clearly states how important it is to satisfy and delight a customer in order to grow in business. Its a well known fact that business cant exist without customers. In the business, its important to work closely with your customers to make sure your business is for them and meet their requirements. Because its critical that you form a close working relationship with your client, customer service is of vital importance. Make your customers feel valued, wanted and loved. Customer Relationship Management is combination of people, processes and technology that seeks to understand a companys customer Apple Company is one of the unique companies in todays market. I am taking this company organization to evaluate the opportunities to maintain and increase revenue in their earlier stage. The Apple company was started in 1981and it went through several critical stages to become a unique company now a day. The company faced severe problems due to lack of customer relations and didnt meet the customers expectations as they advertised. The companys first introduced Lisa and Macintosh during 1981 to 1985, but failed to reach the people due to lack of customer relations. They didnt have clear idea what people were expecting and how much they can afford to buy a PC. During this period they introduced their pc with a high price and they didnt have a clue about the people expectations so their product became a failure and they were failing in other tasks due to inner battle with in the company. After learning the lesson they started to learn from the peoples expectations and started to work towards it like introducing Portable versions with networking capabilities and their master piece was SYSTEM 7. but again after this they started to fail in customer relations like failure of proper service centres and even though they introduced several other products like cameras , CD players and other stuffs they failed to involve with the customers when their expectation was to get a Pc with a camera and CD function . But other companies like Microsoft evolved in customer relations and upgraded their products to the customers expectations as possible as they could. So there on apple started to reinvent them what went wrong and they rectified it and moved to a unique company with profit from 1998 by keeping an alliance with other companies and even their rivals and started to evolve. They introduced apple store to have better customer relations, after this the company went on hike by evolving with the customer relations management. OBJECTIVE CRM stands for Customer Relationship Management. It is a process or methodology used to learn more about customers needs and behaviors in order to develop stronger relationships with them. There are many technological components to CRM, but thinking about CRM in primarily technological terms is a mistake. The more useful way to think about CRM is as a process that will help bring together lots of pieces of information about customers, sales, marketing effectiveness, responsiveness and market trends. CRM helps businesses use technology and human resources to gain insight into the behavior of customers and the value of those customers. KEY POINTS IN CUSTOMER RELATIONSHIP MANAGEMENT: CUSTOMER SATISFACTION Business term is a measure of how products and services supplied by a company meet or surpass customer expectation. It is seen as a key performance indicator within business and is part of the four perspectives of a Balanced Scorecard. If the apple had better knowledge of customer expectations and good knowledge in customer relations they could have become a successful company from the start. They thought that if they introduced a good product they can become successful but that resulted in vain. The CEO should have focused on the customer relation management also to gain knowledge from customers what people were expecting from them CUSTOMER DELIGHT Customers will be back for more and new customers will be introduced by them if your service is good and satisfactory. This will help to distinguish you as unique from the rest. It allows you to sell your product or service for more money than the competition. It allows you to make more return on your investment. It allows you to reward your employees. The apple failed to introduce their product in cheaper price this resulted to loose customer from the start of the introduction of their product .even if the customers bought the product they faced problems in how to handle it and lack of parts for repairs they have to wait for a long time. Normally when a company is introducing a product the people wont expect to spend a huge amount in unknown product if the apple introduced their product in cheaper price with initial discounts and had better service centers they would have done well. CUSTOMER LOYALTY Customer loyalty is viewed as the strength of the relationship between an individuals relative attitude and repeat patronage. The relationship is seen as mediated by social norms and situational factors. Cognitive, affective, and co native antecedents of relative attitude are identified as contributing to loyalty, along with motivational, perceptual, and behavioral consequences. Implications for research and for the management of loyalty are derived. The key to a successful business is a steady customer base. After all, successful businesses typically see 80 percent of their business come from 20 percent of their customers. Too many businesses neglect this loyal customer base in pursuit of new customers. However, since the cost to attract new customers is significantly more than to maintain your relationship with existing ones, your efforts toward building customer loyalty will certainly payoff. If the company is having a regular customer they should give some sort of discount in the new products for them .the apple failed to do so. If the company had looked after their regular customers by giving free Operating system upgrade or discount in their New Operating systems they could have got new customers from the regular customers and retained their market in well shape. Some steps to get customers whether they are regular or new are listed below. 10 WAYS TO BUILD CUSTOMER LOYALTY Communicate. Whether it is an email newsletter, monthly flier, a reminder card for a tune up, or a holiday greeting card, reach out to your steady customers. Customer Service. Go the extra distance and meet customer needs. Train the staff to do the same. Customers remember being treated well. Employee Loyalty. Loyalty works from the top down. If you are loyal to your employees, they will feel positively about their jobs and pass that loyalty along to your customers. Employee Training. Train employees in the manner that you want them to interact with customers. Empower employees to make decisions that benefit the customer. Customer Incentives. Give customers a reason to return to your business. For instance, because children outgrow dress quickly, the owner of a childrens dress store might offer a card that makes the tenth dress half price. Likewise, a dentist may give a free cleaning to anyone who has seen him regularly for five years. Product Awareness. Know what your steady patrons purchase and keep these items in stock. Add other products and/or services that accompany or compliment the products that your regular customers buy regularly. And make sure that your staff understands everything they can about your products. Reliability. If you say a purchase will arrive on Wednesday, deliver it on Wednesday. Be reliable. If something goes wrong, let customers know immediately and compensate them for their inconvenience. Be Flexible. Try to solve customer problems or complaints to the best of your ability. Excuses such as Thats our policy will lose more customers then setting the store on fire. People over Technology. The harder it is for a customer to speak to a human being when he or she has a problem, the less likely it is that you will see that customer again. Know Their Names. Remember the theme song to the television show Cheers? Get to know the names of regular customers or at least recognize their faces. LOYALTY PERCENTAGE A mere 5 % increase in customer retention can result in a 75% increase in customer value according to Fred Reichheld, author of Loyalty Rules. A great reason to pay attention to loyalty. Here are more benefits: grab more sales from existing customer base help spread word of mouth marketing identify product/service problems earlier improve profitability provide a competitive advantage Defining Customer Loyalty Customer loyalty is the practice of finding, attracting, and retaining your customers who regularly purchase from you. Customer loyalty is not customer satisfaction. Customer satisfaction is the basic entry point of good business practices. Your small business should provide satisfaction to all your customers. CRM, despite all the talk about it being one of the most profitable customer strategies of the decade, still allows room for failure. Top 10 Features to Look for in a CRM System: Sales-cycle analysis Integration to your back-office accounting system Open, industry-standard technology Seamless flow of information between corporate systems and remote employees Real-time reporting and analysis Automated workflow Contact and campaign management Multiple language and multicurrency capabilities to support global business Ability to easily customize your solution to fit your business needs Scalability to accommodate future business growth What are the Problems occur within CRM? Exorbitant Costs One of the problems with CRM is the huge investment needed to maintain a customer database. The additional expense comes because of the money needed for computer hardware, software, personnel etc. The costs involved are enormous and most often than not the resultant ROI from the CRM implementation fail to cover the costs involved. This leads to a negative feeling within the company about CRM and its successes and ultimately results in CRM collapse. Inadequate Focus on Objectives Secondly when starting off on a CRM strategy the objectives are clearly established and followed. Management and employees know fully well what is needed to work towards organizational goals. The goals themselves are clearly laid out after meticulous planning. However midway during the CRM implementation, when hard times hit, the organization loses sight of its goals and ultimately steers away from it. At times goals get interchanged and lose their importance. Companies find themselves work at home directory towards goals that are less important and forgetting the ones that really are. This is one of the fundamental and mostly felt problems in CRM. Insufficient Resources Sometimes in phased implementation of CRM, if conditions worsen within the company or without, organizations start lessening their budgets for the current phase. When funds are less, budgets strained, the necessary costs required for CRM success are not employed. As a result CRM starts failing midway. The most important aspect- that of maintaining consistency is lost. Organizations fail to utilize the necessary resources for success and thus result in failure. Inappropriate Metrics Organizations have basically failed to use the right metrics. Failure to choose the right method of measurement and implement it is one of the chief reasons why CRM fails. Different metrics have to be employed for the calculation of different goals. Companies seldom pause to analyze which metric is needed for which element and ultimately use the wrong one. This results in faulty measurement and CRM disappointments. Complex Systems CRM simple? The hype says so, the experts agree. Is this really the case? Organizations that have employed it though have a different opinion. They are witness to the fact that CRM packages can be highly complex, with vast amounts of intricacies. If this is the case then how do simple employees cope? The answer lies in sufficient training being given in order that they are able to comprehend and deal with the difficulties easily. Business Needs Most Important One of the chief mistakes companies make is letting the technology drive their CRM functionality. Whats happening is that companies are endeavoring to go to the industry leaders, gain the technology needed and then apply it to the business problems only to find that it isnt solving any of them. Instead they need to analyze their business problems first and then find the appropriate CRM solution for it. This backwards step is responsible for CRM failure. No Customer Focus Customer oriented strategy? Yes, CRM does play the part. Customer oriented employees? Now that requires an effort on the part of the organization. It needs to motivate employees to be absolutely customer centric. This involves tremendous effort on the part of the company but is highly essential. CRM problems arise because of employee reluctance to be more customers focused. The result is a highly expensive customer strategy being adopted by the company in an effort to retain customers, with reluctant, unfocussed employees implementing it. Slow Returns Another failure of CRM is its inability to provide quick returns on investment. Organizations find themselves waiting for years before they are able to see actual returns on their investment. Most experts view the low ROI (Return of Investment) as a major problem with CRM but fail to see that the long wait is just as difficult. Waiting for years to see their investments show results, tests patience and leads to both employees and management slackening their efforts in the implementation. The apple started to listen to customers expectations and kept on looking what they can do to improve their customer relations. So they introduced several ways and walk in centres and done what ever they could to satisfy the customer expectation like introducing Ipads Iphone, Mac book and etc if they done these things from the start of the company they could have been a very successful company Once the apple rectified and reinvented by following the above key points by having direct relation ship with the customers the company will grow into a unique company CONCLUSION Most CRM problems can be mitigated, resolved and ultimately obliterated. What is highly required is the ability to focus on the business needs, choose a CRM package that works towards it, employ the right resources and assume the right metrics. Adopting these measures would go a long way in alleviating CRM problems. The world is ready for the business minded people to move further with high aim and warm refreshing ideas to make the world bloom to a lovely spotlight that feels happy to glitter with most obvious and LOVELY Customers. The apple gained their knowledge after several critical stages and gained lot of customers and when they started to look after them the company began to become a challenger and better name in the industry and with in the people