Introduction:

The biggest management challenge in the millennium of liberalization and

globalization for a business is to serve and maintain good relationship with the king the
customer. In the past producers took their customers for granted, because at that time the
customers were not demanding nor had alternative source of supply or suppliers. But today there
is a radical transformation. The changing business environment is characterized by economic
liberalization, increasing competition, high consumer choice, demanding customer more
emphasis on quality and value of purchase etc.
All these changes have made today’s producer shift from traditional marketing to
modern marketing. Modern marketing calls for more than developing a product, pricing it,
promoting it and making it accessible to target customer, it demands building trust, a binding
force and value added relationship with customers.
The process of developing a cooperative and collaborative relationship between the
buyer and seller is called customer relationship management shortly called CRM.

CRM (customer relationship management)

CRM (customer relationship management) is an industry term for methodologies,
software, and usually internet capabilities that help an enterprise manage customer relationship
in an organized way.

According to one industry view CRM consists OF:

 Helping an enterprise to enable its marketing departments to identify and target
their best customer, manage marketing campaigns and generate quality leads for the
sales team
 Assisting the organization to improve telesales, account, and sales management by
optimizing information shared by multiple employees, and streamlining existing
process
 Allowing the formation of individualized relationship with customer with the aim of
improving customer satisfaction and maximizing profits: identifying the most
profitable customer and providing them highest level of service.
 Providing employees with information and process necessary to know their
customer understand and identify customer needs and effectively build relationship
between the company, its customer base and distribution partners,
Definition:
CRM is concerned with creating improved value through the use of customer centric
business processes and value through the use of customer centric business processes and the
development of appropriate relationships with consumers.
Aims of CRM;
The CRM is a new technique in marketing where the marketer tries to develop long
term relationship with the customers to develop them as life time customer. CRM aims to make
the customer climb up the ladder of loyalty
The company first tires to determine who are likely prospects I.e. the people who have
a strong potential interest in the product and ability to pay for it. The company hopes to strong
convert many of its qualified prospect into first time customer and then to convert those first
customer into clients- they are those people who buy only form the company in the relevant
product categories. The next challenge for the company is to convert these clients into advocates.
Advocates are those clients who praise the company and encourage other to buy form it.
The ultimate challenge is to convert these advocates into partners where the customer
and the clients work activity together to discover ways of getting mutual benefits.
Thus in CRM the key performance figure is not just current market share but share of
life time value by converting customers into partners.
Benefits of Customer Relationship Management;
Customer relationship management system may be chosen because it is thought to
provide the following advantages:
 Quality and efficiency
 Decrease in overall costs
 Decision support
 Enterprise ability
 Customer attentions
 Increase profitability
 Improved planning
 Improved product development
Customer service:
CRM software provides a business with the ability to create, assign and manage
requests made by customer. An example would the called center software which helps to direct a
customer to the agent who can best help them with their current problem recognizing that this
type of service is an important factor is attracting and retaining customers. Organization are
increasingly turning to technology to help them improve their clients experience while aiming to
increase efficiency and minimize costs. CRM software can also be used to identity and reward
loyal customer which in turn will help customer retention.
History of CRM
Customer relationship management (CRM) is one of those magnificent concepts that
swept the business world in the 1990’s with the promise of forever changing the way business
small and large interacted with their customer bases, in the short term. However, it proved to be
an unwieldy process that was better in theory than in practice for a variety of reasons. First
among these was that it was simply so difficult and expensive to track and keep the high volume
of records needed accurately and constantly update them. In the last several years however newer
software systems and advanced tracking features have vastly improved CRM capabilities and the
real promise of CRM is becoming a reality. As the price of newer, more customizable internet
solutions have hit the marketplace; competition has driven the prices down so that even relatively
small business are reaping the benefits of some custom CRM programs.

In the beginning…
The 1980’s saw the emergence of database marketing, which was simply a catch phrase to
define the practice of setting up customer service groups to speak individually to all of a
company’s customer. In the case of larger key clients it was a valuable tool for keeping the lines
of communication open and tailoring service to the clients need. In the case of smaller clients,
however, it tended to provide repetitive survey- like information that cluttered databases and
didn’t provide much insight. As companies began tracking database information they realized
that the bare bones were all that was needed in most cases: what they buy regularly, what they
spend what they do.
Advance in the 1990’s
In the 1990’s companies began improve n customer relationship management by making
it more of a two-way street instead of simply gathering data for their own use they began giving
back to their customers services. Not only In terms of the obvious goal of improved customer
service, but in incentives, gifts and other perks for improved customer loyalty. This was the
beginning of the now familiar frequent flyer programs, bonus points on credit and a host of other
resources that are based on CRM tracking 3333 customer activity and spending patterns. CRM
was now being used as way increase sales passively as through active improvement of customer.

Implanting CRM:
CRM requires an integration of a firm’s resources: people, operations and marketing
capabilities to deliver added value to the customer. CRM should provide businesses and
organizations with a single view of their customers and across irrespective of the interactive
channel or medium through which the customer accesses the services or product.
1. Advances in information technology, network and manufacturing technology have
helped companies to quickly match competition. As a results product quality and
cost are no longer significant competitive advantages.
 2. The growth in service economy. Since services are typically produced and delivered
at the same institution, it minimizes the role of the middlemen
3. Customer expectations are changing almost on a daily basis. Newly empowered
customer, who choose, how to communicate with the companies various available
channels? Also nowadays consumers expect a high degree of personalization.
4. Emerging real time, interactive channels including e-mail, ATMs and call center that
must be synchronized with customer’s non-electronic activities. The speed of business
change requiring flexibility and rapid adoption technologies.
Real customer relationship management as its thought of today really began in the early years of
this century. As software companies began relation newer, more advanced solutions that were
customized across industries, it became feasible to really use the information in a dynamic way.
Instead of feeding information into a static database for future reference, CRM became a way to
continuously update understanding of customer needs and behavior. Branching of information,
sub –folders, and custom tailored features enabled companies to break down information into
smaller subsets so that they could evaluate not only concrete statistics, but information on the
motivation and reactions of customers. The internet provided a huge boon to the development of
these huge databases by enabling offsite information storage, where before companies had
difficulty supporting the possibilities and CRM took off as providers began moving towards
internet solutions. With the increased fluidity of these programs came a less rigid relationship
between sales, customer of new strategies for more cooperative work between these different
divisions through shared information and understanding, leading to increased customer
satisfaction form order to end product.
Today CRM is still utilized most frequently by companies that rely heavily on two
distinct features: customer service or technology. The three sectors of business that reply most
heavily on CRM – and use it to great advantage- are financial services, a variety of high tech
corporations and the telecommunication industry, the financial services industry in particular
tracks changes in investment habits industry can give financial service providers truly impressive
feedback in these areas.
Another force driving the adoption of CRM has been the total quality movement, when
companies embraced TQM it became necessary to involve customers and suppliers in the needed
close working relationship with the customer thus several companies such as formed partnering
relations with suppliers and customer to TQM other programs such as JIT and MRP also made
use of interdependent relationship between suppliers and customers.
On the supply side it pays more to develop relationship is less expensive and more
sustainable competitive advantage than acquiring new ones.
The globalization of word marketplace makes it necessary to have global account
management for the customer.
Identify your customer:
To launch a one initiative the company must be able to locate and contact a fair number
of customers or at least a substantial portion of its valuable customers differentiating them will
help the company to focus its efforts to gain the most advantage with the most valuable
customers.
Differentiating your customer
Customer are different in two principal ways: they represent levels of value and have
different needs, once the company identifies its customers differentiating them will help the
company to focus its efforts to gain the most advantages with the most valuable customer.
Interacting with the customer
Interacting is also a crucial component of successful CRM initiative. It is important to
remember that interaction just not occur through marketing and sales channels, customer interact
in many different ways with many different areas of the organization must be accessible to the
customer.
Customize your enterprise’s behavior
Ultimate to lock a customer into a relationship a company must adapt of its behavior to
meet customer’s individually expressed needs this might mean mass
Marketing:
CRM systems for marketing help the enterprise identify and target potential clients and
generate leads for the sales team. A key marketing capability is tracking and measuring
multichannel campaigns, including email search social media, telephone and direct mail. Metrics
monitored include clicks, responses, leads, deals, and revenue, alternatively, prospect
relationship management (PRM) solutions offer to track customer behavior and nature them form
contact to sale, often cutting out the active sales process altogether.
In a web-focused marketing CRM solution, organizations create and track specific web
activities that help develop the client relationship. These activities may include such activities as
free downloads, online video content, and online web presentations
Product- or company- related postings
Positive product comments, reviews
Visitors following link form social channel to online store’s URL
Visitors referred to website from online frie
Review of literature

Customer relationship management (CRM) as become one of the must

dynamic technology topic of the millennium
According to chen and popvich (2003) CRM is not a concept is really new but
rather due to current development and advances in information and enterprises
software technology, it has assumed practical importance. The root of CRM is
relationship marketing, which has the objective of improving the long-term
profitability of customers by moving away from product –centric marketing.

Bose 2002 noted that CRM was invented because the customers differ in there
preferences and purchasing habit if all customers were a like, there will be little need
for CRM. As a result, understanding customer drivers and customer profitability,
firms can better tailor their offerings to maximize the overall value for their
customer portfolio. The attention CRM is currently receiving across business is due
to the fact that marketing environment of today is highly saturated and more
competitive

In term of information technology CRM means an enterprises wide integration of

technologies working together such as data warehouse, website and intranet
/extranet, phone support system, accounting, sales , marketing and production kolder
2000 assured that CRM gives as IT to gather data , which can then be used to
develop information acquired to creat a more personal interaction with the customer.
In the long term, it produces a method of continuous analysis and reinforcement in
order to enhance customer’s life time value with firms

Objectives and benefits of CRM

Gronroos (2004) explains that an-going relationship with customer will help in
providing a sense of security, trust and feeling of control through studies Xu
and Walton (2005)have concluded that the major reasons corporation
managers are implementing CRM are .
 Improve customer satisfaction
 retain existing customer
 Provide strategic information
 Improve customer life time value
Benefits of relationship as defined by gummerson
Gummerson (1994) explains that the building of relationships is key reaching and
maintaining a successful market share, gummerson the benefits as:

Retention
By learning relevant information about the customer such as: names habits
preferences and expectations one-on-0ne relations can be formed and customer can be
kept coming back continuously.

Objective as define by sheriff, nguyen &newby

The general objectives of CRM systems are to collect data about interactions with
the firm (nguyan, sheriff new by (2007) they also state these points as more specific
objectives.
Increased customer loyalty
Collecting all important information about a customer and having all the relavent
data about a customer’s history readily available all the access points in the organization