CRM is about the entire Customer Cycle. As part of CRM implementation, we need to capture and analyze data about targeted customers and their targeted buying habits. From this wealth of information, you can understand and predict customer behaviour.
Marketing efforts, armed with this customer intelligence, are more successful at both finding brand new customers and cultivating a deeper share of wallet from current customers. The CRM strategy should be clear and consistent by sharing a common vision of the customer service/sales profile. Thus, customer service profiling may assume different shapes like an hour glass, pyramid etc. depending on relationships between the three levels: 1.
Initial transactions 2. Repeat customers 3. Customer advocates Further, CRM measures can help stabilize the CRM strategy. These measures can come in the form of subjective measures like customer satisfaction surveys or tracking complaints and compliments. And objective measures through hard data like, average length of transaction, transaction accuracy, ability to resolve customer issues in the first contact etc. CRM is a comprehensive approach for creating, maintaining and expanding Customer Relationships.
The CRM “tools” may be high-tech or low-tech. These tools cannot substitute for Good Customer Service skills. At the end of the day, the best customer experiences are human and feel humane. Even if the customer and the service provider never meet, when solid customer-handling skills inform the design of the e-commerce interaction, satisfaction is increased. Services Marketing with an intangible product and the copyright impossible on many service innovations, marketing staff in the services industries are faced with a special challenge: how can a bank achieve a unique corporate image, product differentiation and a distinctive reputation in the marketplace? Adrian Payne has attempted to define “service” as an activity which has some element of intangibility associated with it, which involves some interaction with customers or with property in their possession and does not result in a transfer of ownership. A change in condition may occur and production of the service may or may not be closely associated with a physical product. The four characteristics most commonly ascribed to services are: Intangibility: Abstract and intangible Heterogeneity: Non-standard and highly variable Inseparability: Services produced and consumed at the same time Perishability: It is not possible to store services in inventory With such “unusual” features of banking products also, the continuous challenge is to deal with the varying demands on personal service delivery. Electronic channels do help, leaving more time for flexibility of service within the bank.
Even in the “tangible” manufacturing sectors, there is an increasing trend to differentiate products by service elements (pre-sales and post sales).Understanding the position of a particular service on each continuum and the position of competitors, is an important step towards finding possible sources of competitive advantage. The increased attention to the application of marketing in the services sector has brought into question what the key components or elements of a marketing mix for services are or what they should be. It is; therefore, appropriate to reconsider the traditional marketing mix in the context of services. The 4 Ps are derived from a much longer list of 12 elements developed by HBS in 1 960s.
These were, product plan, pricing, branding, channels of distribution, personal selling, advertising, promotions, packaging, display, servicing, physical handling, fact-finding and analysis. Over time, the 4 Ps were adopted to capture THE KEY ELEMENTS. So what is a less restrictive marketing mix model for Services? This is not a comprehensive check-list and the decision on pricing will be dependent on a range of factors: a.
Positioning of the service b. Corporate objectives c. The nature of competition d. Lifecycle of the service e. Elasticity of demand f. Cost structures g. Shared resources h. Prevailing economic conditions i.
Service capacity. Based on all of above, the service marketer needs to consider the method by which prices will be set. Some of the methods used in the services sector include the following: a. Cost-plus pricing: mark-up overall costs b. Rate of return pricing: Also called target return pricing c. Competitive parity pricing: Following that set by market leader d.
Loss leading pricing: Short-term, to establish position or to cross-sell other services e. Value-based pricing: Market driven approach, where prices are based on “value- perception” by the customer f. Relationship pricing: Based on future potential profit streams over the lifetime of customers.
It can be argued that Relationship Pricing is an appropriate form of pricing where there is an ongoing contract between the service provider and the customer. Relationship pricing follows closely the market-oriented approach of value-based pricing but takes the lifetime value of customer into account.