Case Study Role of Customer Relation Management in Indian Market
Customer Relationship Management (Crm) What is Customer Relationship Management (CRM)? Customer Relationship Management (CRM) is an information industry term for methodologies, software, and usually Internet capabilities that help an enterprise manage customer relationships in an organized way. Customer Relationship Management has been in the limelight since the past decade. CRM has emerged in recent times because it is easier and more profitable to retain existing customers than to acquire new ones. It is a business strategy to learn more about customers’ needs and behaviors in order to develop stronger relationships with them. The relationship delivers value to customers, and profits to companies. According to industry view, CRM consists of: * Helping an enterprise to enable its marketing departments to identify and target their best customers, 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 processes (for example, taking orders using mobile devices) * Allowing the formation of individualized relationships with customers, with the aim of improving customer satisfaction and maximizing profits; identifying the most profitable customers and providing them the highest level of service. * Providing employees with the information and processes necessary to know their customers, understand and identify customer needs and effectively build relationships between the company, its customer base, and distribution partners. From the technology perspective, companies often buy into software that will help to achieve their business goals. For many, CRM is far more than a new software package, the renaming of traditional customer services, or an IT-based customer management system to support sales people. However, IT is vital since it underpins CRM, and has the payoffs associated with modern technology, such as speed,...
Overview: Retail is India's largest industry, accounting for over 10 per cent of the country's GDP and around eight per cent of the employment. It is one of the most dynamic and fast paced industries with several players entering the market. The growing middle class, who has a substantial disposal income in hand, constitutes the largest shoppers' segment in India. Its consumer behaviour is changing continuously and reaching new levels of tastes and preferences. IT is emerging as major tool of customer relationship in the retail markets in India. They are doing this by aggressively adopting IT applications to streamline from accounting and human resource management to core functions like buying, merchandising, supply chain management, store management, marketing and especially customer relationship management. This present paper highlights the strategies followed by the retail industry in India for retaining their large customer database. It also made an attempt to bring out the applications of information technology in retailing
Introduction: Retailing in India is gradually becoming one of the key industries for economic development .The changed consumer behaviour and in creased standard of living in the growing middle classbrough t arevolution in Indian retail scenario. Modern retail has entered India as seen in sprawling shopping centres, multi-storeyed malls and huge complexes offer shopping, entertainment and food all under one roof. The other reason is a significant change in th demographics. A large young working population with median age of 24 years, nuclear families in urban areas, along with increasing working-women population and emerging opportunities in the services sector are the key growth drivers of the retail sector in India.. Now there is a tough competition between the organized retail chains and unorganized retailers... Customers are the "profit –centre" in an organization. The existence of organization depends on the customers. With this the concept –Customers Relationship Management has come into the picture. The main aim is to maintain a good relationship with the customers. It is the process of creating, maintaining, and enhancing strong value-added relationships with customers and other stake holders.
Customers Relationship Management is the strategy that aims to understand and, anticipate, manage and personalize the needs of an organization's current and potential. The Rs.85,000 crore FMCG market in India is growing at a fast pace despite of the economic downtrend. The increasing disposable income and improved standard of living in most tier II and tire III cities are spearheading the FMCG growth across the nation. The changing profile and mind set of the consumers has shifted the thought to "Value for Money" from "Money for Value". Over the years companies like HUL, ITC and Dabur have improved performance with innovation and strong distribution channels. Their key categories have strengthened their presence and outperformed peers in the FMCG sector.
Retail: In Detail The emergence of Retail in India is cause for success of Indian organized Retail & Marketing. With the help of modern management techniques we will become the specialist Retailers in future. We know that the relationship between the Retailer & customer is very close than other chains of distribution. India is a nation of shopkeepers. We can see more than 16 million plus retail outlets in India, and India has highest density of retail outlets in the world. Retail Industry in India is at present estimated to be more than US $ 250 billion. On that part of organized retailing is estimated 3.5% i.e. $ 7.47 billion. By the year 2010 the vision of Industry is to attained more than the goal which was estimated US $ 23 billion in organized retail. If we are comparing the growth of retail in India as compare to China we will find that China has more growth than India. In the year 1996 the per capita GDP of China was US$ 675 and it increased US$ 434 in year 2003 i.e. in the years 2003 the contribution of retailing in GDP per capita of China was US$ 1109. But in India, in the year 2005 it was only US$ 710. We can say that in 1996-97 (or in 90's the position of retail market in China was very strong than Indian Retail market.
If we are taking as base the size of retail market in India it was only US$ 215 billion in 2005 but in China it was US$ 225 billion in 1996 & US$ 400 billion in 2003. It means the status of India's size of retail market is not very matured as compare to China. The share of organized trade in retaining in India was quite more than 4% in 2005, but it was between 7-8% in 1996 and 17% in 2003 in China. At present USA is biggest retail market with 85% share of organized trade in retailing at the second step. There is Malaysia with 55% plus, Thailand with 40%plus , Brazil with 35%plus, Russia with 33%plus, Indonesia with 30%plus, Poland with 20%plus, China with 17% plus & then India with 6% plus only.
Organized Retail: Organized retail segment has been growing at a blistering pace, exceeding all previous estimates. According to a study by Deloitte Haskins and Sells, organized retail has increased its share from 5 per cent of total retail sales in 2006 to 8 per cent in 2007. The fastest growing segments have been the wholesale cash and carry stores (150 per cent) followed by supermarkets (100 per cent) and hypermarkets (75-80 per cent). Further, it estimates the organized segment to account for 25 per cent of the total sales by 2011. It is expected that by 2016 modern retail industry in India will be worth US$ 175- 200 billion. India retail industry is one of the fastest growing industries with revenue expected in 2007 to amount US$ 320 billion and is increasing at a rate of 5% yearly. A further increase of 7-8% is expected in the industry of retail in India by growth in consumerism in urban areas, rising incomes, and a steep rise in rural consumption. It has further been predicted that the retailing industry in India will amount to US$ 21.5 billion by 2010 from the current size of US$ 7.5 billion. Shopping in India has witnessed a revolution with the change in the consumer buying behaviour and the whole format of shopping also altering. Industry
of retail in India which has become modern can be seen from the fact that there are multi- stored malls, huge shopping centres, and sprawling complexes which offer food, shopping, and entertainment all under the same roof. India retail industry is expanding itself most aggressively; as a result a great demand for real estate is being created. Indian retailers preferred means of expansion is to expand to other regions and to increase the number of their outlets in a city. It is expected that by 2010, India may have 600 new shopping centers. In the Indian retailing industry, food is the most dominating sector and is growing at a rate of 9% annually. The branded food industry is trying to enter the India retail industry and convert Indian consumers to branded food. Since at present 60% of the Indian grocery basket consists of non- branded items. India retail industry is progressing well and for this to continue retailers as well as the Indian government will have to make a combined effort. The report examines the growing market for FMCG market in India. This starts with an overview of the Industry in India and goes on to explain how product and demographic categories across the nation have added value to the Industry. The report examines the recent development within the industry and tries to gauge the impact in shaping the landscape of the FMCG market. It also contains a summary of the key
players, including their product portfolio, business operations, and strategies. The report concludes with an industry outlook section. Finally the report mandates with the outlook for the year 2013, considering the current events and growing economy. The report concludes with a list of growth drivers, breaking them into demand side, supply side and systematic drivers.
Analysis and Interpretation: 1) Do you come to Vishal Mega mart for shopping regularly?
The above shows that 73.33% customers come to Vishal for shopping regularly. The numbers of regular customers are more. So to retain them different loyalty programmes should be introduced. 2) Which one do you like in Vishal?
The above chart shows that 83.34% customers prefer offer. Manly 25% offer on Wednesday & Thursday is preferred by customers. So by giving offer on these days it can satisfy its customers 3) With whom would you like to shop?
The above chart shows that 55.33% customers prefer to come for shopping with family members. So combo family offer pack should be more. 4) Do you find the products easily in Vishal Mega mart?
From the above chart it is clear that 53.33% customers don't find the products easily. So the concentration would be given to visual merchandise. 5) Are you satisfied with the sales force' behaviour?
Above chart shows that 86.66% customers are satisfied with the behaviour of sales force. So it would increase the satisfaction level. 6) Do you like the shopping environment inside the Vishal Mega mart?
The pie chart shows that 64.66% customers are satisfied with the shopping environment inside. It is clear that ambience is preferable. 7) How much can you spend shopping?
According to the chart, customers spending capacity falls between 500-1000(36.66%).It is the maximum capacity.
8) How is the billing process in Vishal? According to the chart, billing process 50% is good & 50% average. But the problem is with the coding system. 9) Which of the following do you prefer for advertisement?
The above chart shows that 46% customers prefer mobile SMS and they have shown less interest in TV which only 10%. To get information about offers and new arrivals about.
The following are some problems faced by the customers. These are collected from the feedback. * Customers are not satisfied with the quality of the products. * Sometime confusion about the offers. * Customers get confused about the way of the sections. * Varieties of the products sometime not preferred by the customers. * They are not satisfied with the parking facility. * Sometime the customers are not getting the help of sales force. * Lack of sales women in women's section. Problems faced by the ladies. * Customers are not aware about the new arrivals. * Lack of advertisement. * Customers face size problems. * Proper colour sheds are not available. * Stocks problem is also present * There is no complaint box. * Complaints of the customers are not checked.
One Best Example is as Shown below:The Lost Customer Relationships in the Indian Retail Industry :Recently I visited a supermarket, after my shopping when I was about to pay my bill, the cashier offered me their membership at nominal joining price and showed me a few benefits for enrolled members. The same incident is repeating at every retail outlet. Every retailer is trying to tie the customer by issuing a membership at a nominal price and showing them a few benefits. Same is the case with Loyalty programs, instead of building true customer loyalty these loyalty programs are becoming sales campaigns which only aim at increasing revenue from customer. With so many programs and memberships customers are treating these as sales pitches rather than relation enhancement/building programs. Companies are forgetting the basics of building relationships and are actually trying to tie customer to their outlets through memberships and Loyalty programs. Customers are humans and not mindless creatures to stay still if tied to something. One decade back before the emergence of organized retail sector, Indian retail market was dominated by “Kirana*” shops, where the shopkeeper/owner was a part of the same community where the customers lived. These Kirana merchants knew the preferences, interests, needs, wants, any events in the customer family, any emergencies, financial issues, etc of the customers. This is more than 360 degree view of a customer; this helped the Kirana
merchant to sell the right product to right customer and even give credit at times, if required. Since they know the customers personally Kirana shopkeepers could give customers credit based on their financial abilities and based on the need and situation of the customer. They rendered a helping hand during emergencies and thus gained customer trust and loyalty. Before the advent of organized retail such a strong bond existed between customers and retailers in Indian retail market, but as the organized retail is increasing its presence, these bonds are loosening and artificial relationships are being built where customer loyalty, customer trust, etc are either superficial or doesn’t exist. What is happening now is that companies are trying to do everything artificially, build artificial relationship with customer by enrolling them as members, artificial loyalty by enrolling customer for a loyalty program, and so on. The fact is that the customer still doesn’t trust the retailer since for the customer there is no real relationship! How many customers are willing to share their personal information with the retailers? Companies think about building customer relationships, but talk about experience, satisfaction, delight and so on, but forget the foremost thing which is “customer trust”. Your customer service might be excellent, customer might be happy, but if customer feels that he/she is paying more for a nominal product packaged with excellent service the trust is broken. Retailers are totally different from manufacturers, manufactures can sell more products if they build good brand image and have good retailers in their distribution chain, but retailers
cannot sell if they don’t build good relationships. Though a retail chain might have a great brand value, if the relationship quotient is low, then they fail miserably. Terms like Brand Loyalty etc have very minimal controlling effect when we talk about retailers. There are several big brands which failed miserably in retail business. The emergence of Social CRM might help in building customer relationships if properly leveraged to build trust rather than considering them as tools to gain customer information. If companies continue with the latter perception, soon the customer relationships die as Social CRM sites can spread the negative image of companies as fast as they can spread the positive image! This approach will not build the trust factor and which will in turn lead to customer playing safe and not revealing their personal details. Hence companies should try to be a part of the communities and build trust in the customers. Loyalty should be from both sides, don’t expect customer loyalty if you are not loyal to the customer. This holds true for retailers globally, what is your opinion and any inputs on how retailers can leverage on Social CRM? * “Kirana Stores” are the typical “Mom and Pop stores” operated in a single location in towns and cities where the shop owners are the members of the local community
Recommendations: * Satisfy customers by providing quality products. * Stocks and varieties should be available. * Describe customers about the products. * Inform about the offers through mobile. * Show the way to particular section by the signs. * Customers' complaint box should be kept. * Give description about the products on the TV. * Greet them when they are entering into the stores. * Internal branding is needed. * Proper placement of the signage. * Conduct some in store games to motivate the customers. * Provide them seasonal products. Conclusion: The Customer-RelationshipManagement should be use to satisfy ever Customer in the Indian Market.
, improve telesales
, sales management
, optimizing information
, customer relationships
, Customer Relationship Management
Description: What is Customer Relationship Management (CRM)?
Customer Relationship Management (CRM) is an information industry term for methodologies, software, and usually Internet capabilities that help an enterprise manage customer relationships in an organized way. Customer Relationship Management has been in the limelight since the past decade. CRM has emerged in recent times because it is easier and more profitable to retain existing customers than to acquire new ones. It is a business strategy to learn more about customers’ needs and behaviors in order to develop stronger relationships with them. The relationship delivers value to customers, and profits to companies.