To retain customers, customer relationship management (CRM) has become obvious in today's business environment. The effectiveness of new media has come into consideration as the media fragments virtually every day.
In the 90s when there was only one channel, one drama could draw the attention of millions. With the introduction of more than 10 local channels, in addition to more than 70 foreign channels, marketers face a challenge in reaching out to even a 10th of the customers in the 90s with 10 times the cost.
A marketer may buy a 30-second slot to broadcast a television commercial during a popular musical programme, targeting youngsters, while on the other hand, another sports channel is broadcasting a live world cup cricket match between Bangladesh and India and BBC is documenting some breaking news. Think about the target group.
With only a remote control to change to a channel of choice, the impact of the response and return on investment would be lower. So mass media needs mass money to deliver messages across to target groups.
The same is true for billboards. Even when a marketer advertises with larger than life images, it is difficult to make a difference and have a competitive edge in the market through these traditional channels.
It is time marketers revised their strategies to find innovative ways that cannot be copied by competitors. CRM gives insight on how to accelerate benefits by driving the market forward rather than letting it drive the company. In fact, CRM looks for the most advanced ways to market, which is uncommon to business environments in Bangladesh.
CRM tells us what works and what does not in today's competitive and volatile market environment. CRM strategies are designed based on real interactive data whereas mass marketing strategies are based on opinion data.
The reality is that customer choices are wider than ever before. The endless price war has put companies at risk. The market scenario is changing from a sellers' market to a buyers' one.
As the market saturates, marketers' focus shifts from market share to value. Companies are losing control over Porter's five forces: rivalry, the threat of substitutes, buyer power, supplier power and barriers to entry. Where is the end of this price war? Let us look at the success story of Google -- ranked as one of the top performers of 2006.
Google did not use traditional media channels. With $10.6 billion in 2006 and revenues up by 67 percent, Google commanded at least 31 percent of all web ad revenues and became a major threat to Viacom. The small sponsored links that run alongside search results precisely addressed particular interests.
Today people are addicted to Google and it is not only the algorithm that works behind the search mechanism; it is actually the CRM strategy that gave them the competitive edge to outpace Yahoo and AltaVista.
Confusion over CRM has created myths in the market that need to be debunked. CRM consultant Francis Buttle expressed his view to debunk the myth -- to say that CRM is about IT is like saying that gardening is about spade or that art is about the paintbrush.
The implementation of CRM was seen as IT applications that can be used to store and manage customers' records. Although a rich customer database and deployment of IT application are required to apply CRM strategies, this should not be misread as an IT job. Many business executives perceive CRM as software application like Siebel or SAS.
Marketers should not lose sight of the fact that CRM is about people first and technology second. That's where the real value of CRM lies. The basic objective of CRM is to create relationships through providing a greater customer experience. Here the role of technology is just a tool. Technology helps us to get insight and understand the differences between customer satisfaction, experience and expectations three vital components of CRM.
Oracle is playing a major role in radiating business intelligence and creating CRM applications. Business intelligence is not just about departmental reporting anymore. Oracle applications is proving customers insight, enabling managers to make informed decisions and applying CRM strategies.
Today top performing companies from banking to telecom are using the concept of CRM for acquisition and retention of customers. CRM is basically a business strategy that aims to understand the needs and wants of individual customers and then formulates efficient personalised communication mechanisms to serve individual demands and create long-term relationships.
CRM strategy applies the concept of local shop owners in your community, who developed strong relationships with community customers by calling them by their names, exchanging greetings, wishing them on their birthdays and understanding their tastes and serving them accordingly. This is because relationships create long-term loyalty and repeat purchase.
But when the customer base exceeds hundreds of thousands, who are dispersed around various geographic zones and their preferences and expectations change with advancements in technology, it is really a challenge to retain customers through relationships.
The strategic application and effectiveness of CRM is so wide and versatile that it encompasses from retail to telephone companies, insurance, banks and other sectors. With the passage of time, the avenues of CRM are getting wider that includes database marketing, churn management, loyalty programmes, data mining, predictive modelling, business intelligence, direct marketing and telemarketing.
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