What is Customer Relationship Management (CRM)?

Discuss about the Customer Relationship Management Loyalty Program for Implementation.

CRM (Customer relationship management) program is system that manages a group of people, technology and processes which pursues to comprehend the customers of a company. This is an approach that is integrated for the management of relationships through focusing on retention of the customer and development of a relationship. CRM has advanced from the developments in information technology as well as changes in organization in the centric processes of a customer. Companies that implement CRM successfully ought to bear the good fruits in loyalty of customers and profits in the long run. However, many companies have not been able to implement CRM effectively mostly since they could not comprehend that the program of CRM needs company wide, customer focused and cross functional re-engineering process. Despite the fact that a huge part of the CRM comprises of the technology, regarding the solution of CRM as technology would mainly lead to failure. Implementation that is successful in management demands for an approach that is integrated and balanced to technology, process and people.

According to Xu, Yen, Lin & Chou (2012), CRM requires to be viewed beyond being just a technology whereas the technology being viewed as the strategy of CRM enabler. Various applications of technology may be recognized which are utilized in the advancement of the strategy of the CRM. (Xu & Walton, 2015 and Zaayman, 2014). The CRM system comprises of three major constituents:

Operational CRM which comprises of applications that face customers like the force automation of sales, automation of enterprise marketing and support and service of customer (Chen & Popovich, 2013). Call centers for customers are also a part of the operational CRM and are domineering in the systems of CRM. (Anon, 2010). This enables recording of the customer interactions which is used by the organizations in tracking the customer.

Analytical CRM that deals with analyzing of data created in the operational CRM for building the customer picture. This component deals with storing, capturing, extracting, interpreting, processing and reporting of the data of the customer sored in the warehouses of the data. This makes it possible for the organization to evaluate the behavioral patterns of the customer in developing strategies of promotion and marketing. According to a study carried out in UK, 25% of the surveyed organizations showed that analytical CRM was being utilized. (Xu & Walton, 2015).

Technology and CRM

Collaborative CRM utilizes technologies of communication that are traditional and new for enabling customers in interaction with organization. This component enables response of a level that is better to the needs of the customer through incorporation of all stakeholders of the chain of supply like the suppliers among others. (Xu & Walton, 2015). Strategies of channel or functions which offer interaction point between the channel and customer are involved in this component as well. (Shahnam,2010)

An extra category that came up later is the e-CRM. This component enables organizations to obtain the maximum contact via all the channels of communication mainly through intranet and internet.  e-CRM comes out as an approach that is web-centric to contacting customers (Xu & Walton, 2015).

CRM Tools

Facilitation of communication between the customers themselves and the organization is a major component of any strategy of the CRM regarding all kind of aspects of inclusion of the design of the product, relationship, channel preferences, service of the customer and making it possible for the organization to tune its strategy.

From the point of view of Gubser (2011), a number of the technologies that are interactive which offer customer communications that are interactive and care comprise of:

• Emails that are intelligent: Emails continues to be an essential technique of contact for the customer for a percentage exceeding 70% of the total number of businesses carried out online. When the queries of the customers are quickly and effectively responded to through the intelligent email, the cost and time of the customer are reduced. This results to an increase in the satisfaction of the customer and in turn increases rates of retention as well as the loyalty.
• Chat that is collaborative: in the case that customers want to enquire about the details of shipping or a product, the function of a live chat that is collaborative allows them to click on an icon of customer service that is live and displays a chat box. This enables the customer care representative to be able to access the history of the customer with the organization and in return enables them to interact with a customer in an effective manner.
• Telephony: the integration of the Computer telephony (CTI) may be applied since the buttons of call-back can be applied on the pages of the web and once clicked they bring on a new window whereby the customer can give out their phone numbers that can be used to reach them in case of any queries. This leads to increase in the possibility of selling as we as acquiring a new customer.
• Self-help: they comprise of intelligent FAQs as well as the traditional FAQs and agents that are virtual or bots which can converse with customers through chat, offer responses as well as even provide suggestions like a person who is live.
• VoIP: this a technology that uses the LAN or WAN of an organization to transfer voice and data. This allows organizations to communicate with customers directly through the use of headphones and speakers.

In order to come up with a CRM program that is successfully implemented, the following strategies should be put into consideration: identification of reasons why one needs the CRM and expectations by identifying areas that need to be improved and the issues that require attention. (Noel, N. & Janisson, S., 2015.). After identifying the reasons, one needs to find a suitable vendor for the CRM by exploring further in order to find correct system of CRM for a business since there are a lot of options provided as it will affect implementation to a great extent. (Gustafsson et al, 2015). Then comes the budget development. There is also the need to come up with a budget that is realistic that can be used for the expenses of the process of implementation. Then follows the identification of departments and staff to handle the process and training them. In order to ensure that the best practices are followed during the process of implementation, selection of two members that are key and making them part of the team of the project should be considered. Training of the CRM end users and their training materials should be taken care of seriously through devotion of effort and time. A blueprint of the required progress of CRM should then be drawn which details how one desires to proceed with the implementation of the CRM. Finally, one should ensure equal participation from IT and business. (Rigby et al, 2013).

CRM Tools

Among the main advantages of the system of CRM is that it makes the process of customer retention to be smooth and results to increased profitability from customers since the system of CRM assists in supplementing and complementing the physical relationship of the customer’s effort by automating the touch points of the customer. The system ensures that there are minimal mistakes and errors done in the process of managing the relationship of the customer. (Becker et al, 2014)

They system also automates the upstream and downstream processes of sales and marketing, enables the business to integrate their administrative tasks and routine related with customer management, cold calling and pre-sales together with follow up of after sales by making sure that the software of CRM handles those aspects and also increase value by intelligence of the business and mining of data of the database of the customer that is also referred to as the data warehousing. (Brown, S.A. & Coopers, P.W., 2014)

The challenges related with the solution of CRM comprises of the need to invest a good amount of money in it. Since the solutions of CRM are not cheap, businesses are required to make the needed investments and get ready to wait and allow the rewards objectify instead of becoming impatient and requesting for solutions that are instant. The main point is that, implementations of CRM are gradual which implies that the businesses must be really committed deeply and meaningfully. Also, there is the issue of lack of coordination between the vendors and businesses which leads to requirements not being met since the vendors could not properly understand the requirements and the resulting pressure from the businesses to quickly implement the CRM and produce results that are quicker. (Uncles et al, 2013)

Another limitation of the CRM is that it may lead to redundancies brought in the process of customer management due to the duplication of work and effort related with the personnel of sales and marketing being unable to adapt to the process of automation. Implementation of the CRM on the other hand may also lead to more complexity that when not properly managed may result to improper planning and chaos for the activities that are key in the life cycle of marketing and sales. (Chen, I.J. & Popovich, K., 2013)

Another major challenge of CRM implementation is that it involves participation of departments members within an entire organization. Programs of the CRM programs are basically generated and implemented by teams in the cross-organization with representations from every department that is functional. This excites communication and cooperation although actualizing is difficult. Confusion experienced in the company results to the lack of success in the business. This indicates that it is challenging to get on board all the employees and the departments with CRM which is vital for the success that is long-term. (Zikmund et al, 2013)

It is evident that it is not possible to evade implementation of CRM in businesses as they are trying to quench their anxiety in outstanding the CRM in the customer categories of satisfaction of the customers, delight of the customer and “wowing” the customer. The adoption Web 2.0 and social media into the systems of CRM ought to evolve the process of customer relationship.

References

Anon, 2000. Computer Telephony Integration (CTI) [Online] Available from: https://www.itanalysis.com/article_pf.php?articleid=1119 [Accessed: 2005/11/22].

Becker, J.U., Greve, G. and Albers, S., 2014. The impact of technological and organizational implementation of CRM on customer acquisition, maintenance, and retention. International Journal of Research in Marketing, 26(3), pp.207-215.

Brown, S.A. and Coopers, P.W., 2014. Customer relationship management: A strategic imperative in the world of e-business. John Wiley & Sons, Inc.

Chen, I.J. and Popovich, K., 2013. Understanding customer relationship management (CRM) People, process and technology. Business process management journal, 9(5), pp.672-688.

Gubser L. 2011. Enhancing Online Customer Loyalty – New Tools and New Traps [Online]
Available from: https://www.tmcnet.com/cis/oeA0201.htm [Accessed: 2004/04.10].

Gustafsson, A., Johnson, M.D. and Roos, I., 2015. The effects of customer satisfaction, relationship commitment dimensions, and triggers on customer retention. Journal of marketing, 69(4), pp.210-218.

Noel, N. and Janisson, S., 2015. Customer relationship management system. U.S. Patent Application 12/523,303.

Rigby, D.K., Reichheld, F. and Dawson, C., 2013. Winning customer loyalty is the key to a winning CRM strategy. Ivey business journal, 67(4), p.1.

Shahnam E. (2010). The Customer Relationship Management Ecosystem [Online] Available from: https://www.metagroup.com [Accessed: 2002/05/20].

Uncles, M.D., Dowling, G.R. and Hammond, K., 2013. Customer loyalty and customer loyalty programs. Journal of consumer marketing, 20(4), pp.294-316.

Xu M & Walton J. 2015. Gaining customer knowledge through analytical CRM. Industrial
Management & Data systems.

Xu Y, Yen DC, Lin B & Chou DC. 2012. Adopting customer relationship management technology. Industrial Management & Data systems.

Zaayman P. 2013. Functional requirements of e-CRM solutions for the South African SME Sector.
Unpublished M Phil disseration. Johannesburg: Rand Afrikaans University

Zikmund, W.G., McLeod, R. and Gilbert, F.W., 2013. Customer relationship management: Integrating marketing strategy and information technology. Wiley