Customer Relationship Management

Customer Relationship Management

Beyond the glamour of developing the e-channel, business is investing to deploy customer relationship management in traditional channels. In most cases, these capabilities are developed independently, requiring expensive integration later on to achieve the vision of true customer relationship management on an enterprise-wide scale. Integration of these resources is one of the key challenges of successful deployment of CRM across the enterprise.

This is because it has a direct impact on the consistency of the customer experience with the enterprise. So how does the enterprise integrate systems across functions and channels? It does not happen by accident, but through foresight and planning. All the functions and the channels must come together to be fully integrated with maximum efficiency and effectiveness. This technology spreads customer information throughout the enterprise and it must be based on unified information architecture.

Independently developed CRM capabilities usually begin based on function-specific short-term needs. Marketing begins to implement CRM with a variety of products, often combined with integrated suites to plan, execute, and monitor marketing campaigns and perform database marketing.

Lead management and sales force automation capabilities are deployed to support mass customization and to provide up-to-the minute information about the goods in transit, to the customer. Field service representatives and contact centers deploy sophisticated telephony and information systems to provide ongoing customer service and cross-selling.

These separate capabilities do provide a means to support function-specific and channel-focus. Sales and marketing can focus on retention and increase of share of customers instead of acquisition and market share. Customer service can identify and take advantage of cross-sell and up-sell opportunities.

However, customer information does not freely flow across the enterprise. To obtain the vision of customer relationship management, information must move about freely. This requires integration.

And the e-channel is the vision of customer relationship management realized. Customer information must flow like water within, around, and through these functions and channels to ensure that the enterprises can build mutually beneficial relationship with the customers, and even amongst their customers. Everyone in the enterprise participating in the conversion with the customer needs access to the latest information on the customer’s profile, behavior, and expressed needs.

Marketing provides the latest promotions and offers for individual customers, based on their interactions on the website. Products are customized to meet specific customer needs and customer service is fully done, resulting in increased levels of customer satisfaction and loyalty.

With an enterprise-wide view of each customer, the value of each relationship is measurable, and each relationship is managed based on this value. Every customer touch becomes an opportunity to modify customer behavior in a beneficial way based on the totality of information at the disposal of the enterprise. Achieving this vision results in unprecedented competitive advantage in some industries or mere survival in other industries.

E-CRM Solutions

E-CRM solutions can be deployed and managed to provide increased revenues and decreased costs for companies while improving customer service. E-CRM goals can be achieved with internet business strategies, web-based CRM specification development, web systems design and project management, interactive interface design and electronic publishing. The strategy for e-CRM can be visualized in three stages, as given in Figure.

How Technology can help a Business thru Customer Relationships

Interactive computer and communications technology can assist in the sales and support process in several ways. Telephone, live chat and e-mail can enhance the effectiveness of customer service representatives.

Computer-mediated e- mail, chat and animated chat can take over when a human representative is exhausted. They can serve as a filter, answering all but the most difficult questions for the representatives.

Reducing Cost Per Contact

One of the effects of adding the appropriate technology to the customer support or sales mix is that there is often a reduction in the cost per contact, i.e. the money spent to connect with each customer. The cost per contact tends to be highest for personal, one-on-one interactions, simply because the representative’s full attention is necessarily focused on a single customer. The customer receives the full benefit of the representative’s training during the period of contact, as well as many of the resources that result in direct and indirect costs to the company.

Decreasing Developing Time

Customer representatives are expensive to train, to keep motivated, and to retain, especially in this state of the economy. Training a representative for a new product or service may take a few days or up to several weeks, depending on the complexity and the number of products and services the representative is expected to sell or support. Development time is the greatest for representatives who work face-to-face with customers. One reason for this is that it includes recruiting time.

Good all-round salespeople and representatives with fascinating manners, speech, dress, and charisma are hard to find. A business may be lucky enough to locate a representative who has excellent live chat skills, but whose squeaky voice may not do in phone support and whose green hair might not present the business is looking for in person-to-person sales.

Creating Emotional Bonds

Although the golden standard for creating an emotional bond between the customer and a company is to have a dedicated, charismatic salesperson or a representative, technology can be of great help in creating an emotional bond. Live chat is also capable of supporting a meaningful dialogue that can help create an emotional bond, but it is not as powerful as the phone or direct contact. Since e-mail lacks most of the cues we normally associate with a conversation such as immediacy, it has the lowest likelihood of creating a meaningful emotional bond.

Presenting Emotive Content

Human beings are emotional creatures. We react to not only language and voice intonation and the subject, but also to dozens of subtle cues, in the form of physical gestures.

Displaying Empathy

Great salespeople and customer representatives are emphatic; they can understand the customer’s situation or at least give the impression that they do. It is the impression that matters to customers; they want to feel that they have been listened to. This feeling can be communicated best in person, but to some degree over a phone conversation and to a lesser extent over a live chat conversation. Because it lacks immediacy, e-mail tends to be a poor communications conduit for emphatic thoughts and feelings.

Reducing Human Error

Humans are simply more error-prone than computers when it comes to manipulating symbols and values. Assuming there is an accurate customer data to work with; computer-mediated customer communications can have a much lower error rate than human-mediated communications in tracking orders, verifying charges, and identifying repeat customers.

Increasing Flexibility

While computers might excel in flawlessly following human instructions, good customer service representatives excel in flexibility. Regardless of the touch- point, a good representative, when properly trained, can help rectify errors or retrieve missing data that current computer mediated systems cannot.

Improving Interactivity

Interactivity, the ability of representatives to respond to a customer’s queries in near real-time, is best in person and over the phone. E-mail interactivity suffers from an inherent lag from the time a problem statement is made to the response, but the lag time tends to be smaller when the e-mail is computer-mediated. Chat, whether live or computer-mediated, can support a moderate level of interactivity.

Increasing Continuity

From the customer’s perspective, continuity can be extended with computer-mediated chat and e-mail. Continuity is important in forming a bond with customers, especially with personal, and to a lesser extent, phone interactions. Computer-mediated communications can provide infinite continuity. For example, the names used to identify a chat bot can be held constant, and the appearance of animated figures used in animated chat communications can remain constant as well.

Adding a Personal Touch

Even human-mediated communications tend to rely on computer-generated or warehoused customer data to the same extent that computer-mediated communications do. In other words, most touch-points are already leveraging computer technology to provide a personal touch.

Communicating Personality

Computer hardware, programs and websites, all have personalities. However, just as personal interactions tend to have a great potential to exhibit personality, animated chat, where an anthropomorphic figure can communicate with visual cues, text and even voice, has a much greater chance of communicating personalities to customers. The challenge is to create personalities that customers can relate to in a positive way.

Increasing Quality

The quality of customer dialogue tends to be highest when it is controlled by a good salesperson or motivated customer service representative. Phone, live chat, e-mail, and other touch-points can also be of high quality, but are usually not as high as of a good salesperson. Computer technology can help with these other touch-points by minimizing variability and otherwise contributing to quality control. Computer-mediated communications can have consistent, high-quality dialogues with customers, because all possible responses can be validated before they are presented to customers.

Providing Reassurance

An important aspect of the sales process is reassuring customers that their purchase decisions are correct, their problems have been solved, and that their products are on the way. Computer technology can be used for something as ordinary as helping reassure customers about the status of their order, or as sophisticated as creating a personal profile of customers and using it to explain why the products they just ordered are in their best interest.

Increasing Reliability

Humans vary in their reliability from person to person and from day to day. Computers are reliable machines as along as human-generated viruses do not attack them. A business can rely on computer-mediated communications with customers as long as it has tightly controlled parameters. In short, computers excel where reliability is an issue.

Improving Responsiveness

Properly trained sales and support staff can do a good job of responding to customer needs in a timely manner. E-mail has the lowest responsiveness of the human-mediated communication, simply because of the inherent delays in e- mail carries with it, a perceptible delay that is not noticed or at least is not significant in a live chat, for example. Because of the rapid 24×7 response made possible by computers, computer-mediated chat and animated chat are potentially much more responsive than a customer representative or salesperson could be.

Improving Return on Investment (ROI)

Generalizing the Return on Investment (ROI) for a customer representative or computer technology is complicated. There are always specific circumstances, such as the cost of the money and specifications of the people or computer technology involved.

However, in today’s economy, it is generally understood that the turnover is high. This is especially true in the customer-support area, where temporary and seasonal workers fill a relatively large number of representative jobs. It is because of the variable nature of the labor supply and the low cost per contact for computer-mediated dialogue, that the ROI for computer-mediated support of all types is potentially greater than for human- mediated support.

Increasing Scalability

In general, humans do not scale very well. Most interactions are on a one-on-one basis, such as personal, phone, and live-chat communications. E-mail is scalable because it may be handled in batches, with the same generic answer being applied to hundreds of questions. In contrast, computer-mediated touch points are virtually infinitely scalable, given an adequate infrastructure, including supporting server hardware.

Decreasing Variability

Variability is a characteristic of human-mediated communications that is virtually absent in properly computer-mediated dialogues. The variability may be a nuisance, as for example, if the customer inquires about tax code information. An animated chat bot may not be as engaging as a human, but a business will know, to what information its customers are being exposed.

E-CRM Toolkit

An E-CRM ‘toolkit’ covers a wide diversity of channels (see figure). In order to bring true customer management across online business, one needs the E-CRM products to fulfill the following criteria

Is the system delivering the contents a customer wants to see? How is it being managed on the IT platform?

Storefront and Merchandising Services

With large numbers of visitors failing to complete transaction at the checkout, it is needed to ensure that your storefront services propel your customers to the cash point.

E-mail Management

Are e-mail campaigns focused to provide an offer that customer cannot refuse?

How are these tied in with the websites so that customers enjoy a seamless experience?

Customer Management

Is the company managing data across all the sales and marketing functions to its

best?

E-Marketing

How well are e-marketing efforts targeted? How well do they combine with online selling operation?

Assisted Selling

One needs only to look at the Dell business model to see how assisted selling can enhance the shopping experience and achieve business success. But what assisted selling approach will work best for any company?

Managing Customer Value Orientation and Life Cycle

The CRM industry has matured rapidly over the past few years. Contact managers have evolved into full-function sales force automation systems. CRM front-office suites now support marketing, sales and service. Integration between CRM systems and enterprise resource planning (ERP) is becoming more common, if not commonplace.

The E-CRM market is new and rapidly evolving. Implementing CRM for traditional front-office marketing, sales and service operations is becoming the top priority for most companies. That prospect has been challenging enough, being formidable to the new touch-points such as the web. Integration is still the key. Online or offline, client/server technology is still a major factor. Anyone who has implemented client/server applications between the various contact centers and touch-points within an enterprise can afford the complexity and the cost involved in them. In short, CRM is a square peg and e-business is a round hole. However, everything is changing with the introduction of new, web-based CRM solutions.

To help organize the chaos, E-CRM solutions can be grouped into two categories— web-based solutions and web-extended solutions.

The web-based CRM solutions are designed from the bottom up, exclusively for the internet. These are very innovative products, initially focused on the sales (e- commerce) function. More marketing and service capabilities will soon be added.

Web-extended CRM solutions are established (primarily client/server-based) CRM suites, originally designed for enterprise users with extensions, to include web-interface functions. There are three phases of CRM

Acquisition

Enhancement

Retention

Each has a different impact on the customer relationship, and each can more closely tie a company with its customer’s life.

Acquisition

You acquire new customers by promoting product/service leadership that pushes performance boundaries with respect to convenience and innovation. The value proposition to the customer is the offer of a superior product backed by excellent service.

Enhancement

You enhance the relationship by encouraging excellence in cross-selling and up selling. This deepens the relationship. The value proposition to the customer is an advantage with greater convenience at low cost (one-stop shopping).

Retention

Retaining profitable customers for life should be the aim. Retention focuses on service adaptability, i.e. it delivers not what the market wants, but what the customer wants. The value proposition to the customer enhances a proactive relationship that works well with the best interest of the customers. Today, leading companies focus on retention of existing customers much more than on attracting new customers. The reason behind this strategy is simple If we want to make money hold on to customers.

All the phases of CRM are interrelated as shown in Figure. However, performing the tasks as well in all the phases is a difficult proposition, even for the best of companies. Companies often have to choose which one of these dimensions will be their primary focus.