A CUSTOMER RETENTION STRATEGY Ruchi*1 1Asst. Prof

ISSN: 2249-7196 IJMRR/ May 2014/ Volume 4/Issue 5/Article No-9/624-631 Ruchi / International Journal of Management Research & Review

CUSTOMER RELATIONSHIP MANAGEMENT: A CUSTOMER RETENTION STRATEGY Ruchi* 1 1Asst. Prof, Satyawati College (Eve.), University of Delhi, Delhi, India. ABSTRACT Customer relationship management solutions provide you with the customer business data to help you provide services or products that your customers want, provide better customer service, cross-sell and up sell more effectively, close deals, retain current customers and better understand who your customer are. This paper explores the advantage of the model of CRM in getting, keeping & growing strategy. However, there is a tremendous amount of confusion regarding its domain and meaning. This paper also explains the conceptual foundations of CRM by examining the literature on relationship marketing and other disciplines that contribute to the knowledge of CRM. Keywords: CRM Model, Game changer& key strategies with CRM. INTRODUCTION CRM is the short form for Customer Relationship Management . It entails all characteristic of communication that a corporation has with its client, whether it is sales or service-related. While the term customer relationship management is most frequently used to explain a business-customer relationship, CRM system is used in the same way to handle business links, clients, contract wins and sales leads.

*Corresponding Author www.ijmrr.com 624

Ruchi / International Journal of Management Research & Review

Customer Relationship Management is often consideration of as a business policy that enables businesses to: know the customer Retain customers through better customer experience Magnetize new customer Win new clients and contracts Boost profitably Reduce customer management costs Business frequently looking for ways to personalize online experience through tools such as help-desk software, email organizers and dissimilar types of enterprise applications. Well-designed CRM includes the following characteristics: 1. Customer Relationship Management is a customer-oriented aspect with service response based on client input, one-to-one solutions to customers’ necessities, direct online interactions with buyer and customer service centers that facilitate customers solve their query.

2. Sales force automation - This job can apply sales promotion analysis, automate tracking of a client’s account history for frequent sales or prospect sales, and also coordinate sales, marketing, call centers, and retail outlets in order to understand the sales force automation.

3. Use of technology - This feature is about following the technology trend and skills of value delivering using technology to make “up-to-the-second” customer data available. It applies data warehouse technology in order to aggregate transaction information, to merge the information with CRM solutions, and to provide Key Performance Indicators. 4. Opportunity management - This feature helps the company to manage impulsive growth and demand and implement a good forecasting model to integrate sales history with sales projections. LITERATURE REVIEW CRM is one of those magnificent concepts that swept the business world in the 1990's with the promise of forever changing the way businesses 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 businesses 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 customers. In the case of larger, key clients it was a valuable tool for keeping the lines of communication open and tailoring service to the client’s needs. 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. Advances in the 1990's In the 1990's companies began to improve on 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 not only in terms of the obvious goal of improved customer service, but in incentives, gifts and other perks for customer loyalty. This was the beginning of the now familiar frequent flier programs, bonus points on credit cards and a host of other resources that are based on CRM tracking of customer activity and spending patterns. CRM was now being used as a way to increase sales passively as well as through active improvement of customer service.

The last few years… In 2002, Oracle released their Global CRM in 90 Days package that promised quick implementation of CRM throughout company offices. Offered with the package was a set fee service for set-up and training for core business needs. . Also in 2002 (a stellar year for CRM), SAP America's meySAP began using a “middleware” hub that was capable of connecting SAP systems to externals and front and back office systems for a unified operation that links partners, employees, process and technologies in a closed-loop function. Siebel consistently based its business primarily on enterprise size businesses willing to invest millions in CRM systems, which worked for them to the tune of $2.1 billion in 2001. However, in 2002 and 2003 revenues slipped as several smaller CRM firms joined the fray as ASP's (Application Service Providers). These companies, including UpShot, NetSuite and SalesNet, offered businesses CRM-style tracking and data management without the high cost of traditional CRM start-up in October of 2003, Siebel launched CRM on demand in collaboration with IBM. Their entry into the hosted, monthly CRM solution niche hit the marketplace with gale force. To some of the monthly ASP's it was a call to arms, to others it was a sign of Siebel's increasing confusion over brand identity and increasing loss of market share. In a stroke of genius, Siebel acquired UpShot a few months later to get them started and smooth their transition into the ASP market. It was a successful move. With Microsoft now in the game, it's too soon to tell what the results will be, but it seems likely that they may get some share of small businesses that tend to buy based on familiarity and usability. ASP's will continue to grow in popularity as well, especially with mid-sized businesses, so companies like NetSuite, SalesNet and Siebel's On Demand will thrive. CRM on the web has come of age! Marketing scholars are studying the nature and scope of CRM and are developing conceptualizations regarding the value and process of cooperative and collaborative relationships between buyers and sellers. Many scholars with interests in several sub- disciplines of marketing, such as channels, services marketing, business-to-business marketing, advertising, and so forth, are actively engaged in studying and exploring the conceptual foundations of managing relationships with customers. They are interested in strategies and processes for customer classification and selectivity; one-tone relationships with individual customers; key account management and customer business development processes; frequency marketing, loyalty programs, cross-selling and up-selling opportunities; and various forms of partnering with customers including co-branding, joint-marketing, co development, and other forms of strategic alliances (Parvatiyar & Sheth, 2000). Scholars from other academic disciplines, particularly those interested in the area of information systems and decision technologies, are also exploring new methodologies and techniques that create efficient frontline information systems (FIS) to effectively manage relationships with customers. Several software tools and technologies claiming solutions for various aspects of CRM have recently been introduced for commercial application. The majority of these tools promise to individualize and personalize relationships with customers by providing vital

Copyright © 2012 Published by IJMRR. All rights reserved 627 Ruchi / International Journal of Management Research & Review information at every point in the interface with the customer. Techniques such as collaborative filtering, rule-based expert systems, artificial intelligence, and relational databases are increasingly being applied to develop enterprise level solutions for managing information on customer interactions. The purpose of this paper is not to evaluate these application tools and technologies. Those aspects are considered elsewhere by the authors as well as by several commercial research organizations, such as Forrester Research and the Gartner Group. Our objective is to provide a conceptual foundation for understanding the domain of customer relationship management. To do so, we develop a framework for understanding the various aspects of CRM strategy and implementation. CRM SOFTWARE Selecting a Customer Relationship Management program means finding the software that fits the company’s needs. CRM software comes with many features and tools, and despite the fact that many of CRM products offer alike feature sets, there are some unique tools in each one.

Programs can be divided into categories by the following criteria: Features mean how well it integrates with other applications (ex. Outlook, Gmail, iCall etc.) and how available information is. It covers everything from calendar alerts and to-do lists to mobile access and synchronization capabilities. Contact information ranking outlines the program’s ability to store specific information for each contact. Business world is a fast-paced so managers are needs to be able to access customer’s information quickly. Sales and marketing tools designed to help and sustain current clients and gain new ones. Important that this tools help find campaigns with positive ROI and those that are not performed. Ease of use is about app’s design. Programs are checked on clean, quick navigation and easy-to-locate of the most important items. Help and support is about what support Customer Relationship Management software producer provides for their product.

RESEARCH METHODOLOGY This research paper is based on the secondary sources of data collected from Books, Journals, various research papers, different reports published by Govt. & other agencies, newspaper & internet. Five Key Strategies with CRM But what exactly does CRM enable and what are the possible benefits? While there are surely many approaches being espoused in the market today, there are five main strategies that companies can employ to survive and thrive during indecisive economic conditions: 1. Focus on existing customers 2. Maximize revenue opportunities 3. Do more with less 4. Reduce operational costs 5. Optimize existing IT assets It is common knowledge in business circles that it is appreciably cheaper to maintain existing customers than to attain new ones. By providing employees with immediate access to actionable customer data, organizations can better recognize the right customers, enhance their loyalty, and maximize their profitability. Effective customer retention begins with knowledge. Companies should assemble a complete customer profile that allows users to see all demographic data, interactions, communications, and purchases made. This information, combined with robust segmentation and analysis tools, enables organizations to better gauge the profitability of each customer. Organizations can then create programs and policies appropriate with the customer’s profitability. For example, organizations can configure call routing systems to automatically identify high- value customers and route them to premium customer service representatives. Or with access to key metrics agents may be empowered to provide on-the-spot discounts balanced with each customer’s value. But routing the call is only the beginning. In today’s market customers want quality not quantity of information. Customer service agents should be empowered to resolve issues more fast by being equipped with a complete client history and a full view of service incidents so they can zero in on relevant facts and provide the appropriate service or product. And with access to order and invoice information within the CRM system itself, customer service agents can quickly answer billing questions without tedious transfers to other departments. As important as efficient inbound communication is, it is proactive, relevant communication that often endears an organization to its customers. For example, organizations can set up an automated process to alert affected customers of possible issues, such as product defects, and then automatically send out proactive communications to keep their customer base informed. Or they can set up a simple process to automatically send out timely messages, like birthday cards or product vouchers based on a specific date or long customer loyalty to show appreciation to the customer. It is often these “little things” that strengthen the connection between company and customer. With 360- degree customer views, insightful analytics, and streamlined customer service capabilities,

Microsoft Dynamics CRM allows organizations to better identify, service, and retain customers. Establishing customer loyalty is only half of the equation. Organizations also need to maximize the profitability of their existing customers and better capitalize on revenue opportunities. Organizations can use robust segmentation and data mining capabilities to identify trends and patterns that indicate key selling scenarios based on buying behavior, demographics, or other criteria. Taken to another level, organizations might leverage leading indicators such as life-time value (LTV) to predict future profitability and use that information as the basis for more accurate lead scoring and effective sales engagement BENEFITS OF CUSTOMER RELATIONSHIP MANAGEMENT The biggest benefit most businesses realize when moving to a CRM system comes directly from having all your business data stores and accessed from a single location. Before CRM systems, customer data was spread out over office productivity suite documents, email systems, mobile phone data and even paper note cards and Rolodex. Storing all the data from all departments (e.g. sales, marketing, customer service and HR) in a central location gives management and employees immediate access to the most recent data when they need it. Departments can collaborate with ease and CRM systems and it helps and organization to develop efficient automated process to improve business processes. Other benefits include a 360-degree view of all customer information, knowledge of what customers and the general market wants and integration with your existing applications to consolidate all business information. CONCLUSION As the economic environment continues to fluctuate, many organizations are asking themselves what strategies they can pursue to bring tangible business benefits while taking stock of the economic conditions. In a growth economy, businesses typically work hard to expand their customer base and spend aggressively to stoke the growth engine. When money is tight however, existing customer relationships grow in importance as organizations seek a cost-effective way to nurture business expansion. And while there is no magic pill or panacea, customer relationship management (CRM) solutions can provide the foundation for sustainable growth and enable organizations to survive and thrive in these uncertain times. By investing in operational efficiencies, organizations can save money over time and find themselves better positioned to take the lead when times improve. By focusing on their customers, they can continue to nurture the business, strengthen critical relationships, and better capitalize on revenue opportunities. REFERENCES 1. Philip K, Armstrong G. Principles of Marketing, Prentice Hall of India, New Delhi, 2009. 2. Vavra TG. Simplified Customer satisfaction, a step by step guide forISO 9001: 2000 certification. ASQ Quality Press, 1 st edn, 2001. 3. Woodruff RB, Gardial SF. Know your customer: New approaches to understanding customer value and satisfaction, Paperback, April 1996.

4. Anderson JC, Narus JA. Partnering as a Focused Market Strategy. California Management Review 1991; 95-113. 5. Baker MJ. Relationship Marketing in Three Dimensions. Journal of Interactive Marketing 1998; 47-62. 6. Berry LL. Relationship Marketing of Services--Growing Interest, Emerging Perspectives. Journal of the Academy of Marketing Science 1995; 236-245. 7. Berry LL, Parsuraman A. Marketing Services – Competing Through Quality, New York: Free Press, 1991. 8. Bharadwaj SG. The Value of Intangible Firm Assets: An Empirical Examination. In J. N. Sheth & A. Parvatiyar (Eds.), Relationship Marketing: Theory, Methods and Applications). Atlanta, GA: Emory University Center For Relationship Marketing, 1994. 9. Bickert J. The Database Revolution. Target Marketing 1992; 14-18. 10. Beal, Barney. Sales reps are in for a tough 2009, but CRM sales software may help, survey says. SearchCRM.com. Davies, Jim, Adam Sarner, Michael Dunn, Michael Moaz, Johan Jacobs, Gareht Herschel 2009.