CRM

OF

SUBMITTED TO: Mrs.Ruchika Assistant Professor NIFT, Jodhpur

SUBMITTED BY: Aftab Alam Rinkesh Yadav 3rd Sem MFM

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CONTENTS

S. No. 1 2 3 4 5 6

TOPIC Bata Introduction of CRM

PAGE No. 3 6

Customer Experience 8 CRM Model Loyalty Program Acquisition Retention Strategy 9 13 & 14

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Advertisement CRM Matrix

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Performance 19

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Feedback Form References

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BATA

Bata is one of the world's leading footwear retailers and manufacturers with operations across 5 continents managed by 4 regional commercial business units (CBUs). The MBU approach provides quality resources and support in key areas to the companies operating in similar markets such as product development, sourcing or marketing support. Each MBU is entrepreneurial in nature, and can quickly adapt to changes in the market place and seize potential growth opportunities. Bata's strength lies in its worldwide presence. While local companies are self-governing, each one benefits from its link to the international organization for back-office systems, product innovations and sourcing. Although Bata operates in a wide variety of markets, climates and buying power Bata companies share the same leadership points. Two important ones are product concept development and constant improvement of business processes in order to offer customers great value and the best possible service. BATA today Serves 1 million customers per day

Employs more than 50,000 people Operates 5000 retail stores Manages a retail presence in over 70 countries Runs 27 production facilities across 20 countries

Bata Customer Service 1. Wide product assortment Bata Collections target and wide range of Customers and offer an excellent price-quality ratio. Bata's exclusive models along with national and international brands are carefully selected and updated in response to market demand. 2. Personalized Service Qualified and enthusiastic Sales Associates WHO Customers' satisfaction is heart. In many Countries customer service goes beyond the stores with home deliveries, orders Made Possible via catalogs, the web call centers or Even. 3. Clear product merchandising
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Easy-to-shop store layouts with clear product displays by category and by style. 4. Guaranteed customer satisfaction In any Bata store in the world we repair, exchange or refund any products with defects. We exchange or refund unworn merchandise if you change your mind. (Proof of purchase is required for refunds. Please see your local store for more details.)

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1. INTRODUCTION OF CRM
With increased globalization and proliferation of logistic service providers, many companies in the industry are beginning to recognize the importance of the ability to retain existing customer, rather than attracting new one, because they contribute much more revenues than new customers. Besides, it costs companies five times or more to attract a new customer than to keep an existing one. A new concept, named Customer Relationship Management (CRM), focusing on retaining and developing relationship with valuable customers, was brought forward in the mid 80s. In a short span of 20 years, CRM has already seen many successful implementations in both manufacturing industry and service industry worldwide. implementation. Hence, this study seeks to explore a feasible way of CRM implementation that can be successfully adapted to third party logistics industry in Singapore. CRM Customer Relationship Management is a comprehensive approach for creating, maintaining and expanding customer relationships .CRM does not belong just to sales and marketing. It is not the sole responsibility of the customer service group. Nor is it the brainchild of the information technology team. While any one of these areas may be the internal champion for CRM in the organization, in point of fact, CRM must be a way of doing business that touches all areas. Customer Relationship Management (CRM) is a combination of business process and technology that seeks to understand a companys customers from multiple perspectives to deliver identification, conversion, acquisition, and retention. Benefits of CRM Bata want to achieve different aspects of benefits by implementing CRM. a 100-year-old footwear maker, had multiplied its revenue, doubled the return on capital and boosted sales per employee by 33% in 5 years after it implemented CRM. By refining its customer strategy, Indian Times, which is one of the most popular newspapers in India, had made its circulation rise by 2% and its customer retention rate hit 94% while the industry average was only 60%. In addition, Another famous Indian fashion magazine had cut down its marketing budget by 33% but increased the revenue by 10% after it re-segment its customer group, making free-catalogs target on more potential buyers. In summary, the total benefits evolved from CRM can be divided into two categories. One is cost reducing, including marketing cost, sales cost and customer service cost. The other one is revenue increasing, including increasing
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share-of-wallet, increasing customer retention rate and improving customer acquisition.

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2. CUSTOMER EXPERIENCE
Customer experience is the sum of all experiences a customer has with a supplier of goods or services, over the duration of their relationship with that supplier. From awareness, discovery, attraction, interaction, purchase, use, cultivation and advocacy. It can also be used to mean an individual experience over one transaction; the distinction is usually clear in context. The goal of customer experience management (CEM) is to move customers from satisfied to loyal and then from loyal to advocate. Traditionally, managing the customer relationship has been the domain of Customer Relationship Management (CRM). However, CRM strategies and solutions are designed to focus on product, price and enterprise process, with minimal or no focus on customer need and desire. The result is a sharp mismatch between the organisations approach to customer expectations and what customers actually want, resulting in the failure of many CRM implementations. Customers receive some kind of experience, ranging from positive to negative, during the course of buying goods and services. An experience is defined as the sum total of conscious events. As such, a supplier cannot avoid creating an experience every time it interacts with a customer . Furthermore, it has been shown that a customers perception of an organisation is built as a result of their interaction across multiple-channels, not through one channel, and that a positive customer experience can result in increased share of wallet and repeat business. A company's ability to deliver an experience that sets it apart in the eyes of its customers serves to increase their spend with the company and, optimally, inspire loyalty to its brand.Loyalty,is now driven primarily by a company's interaction with its customers and how well it delivers on their wants and needs. In short, customer experience meaning a customer journey which makes the customer feel happy, satisfy, justify, with a sense of being respected, served and cared, according to his/her expectation or standard, start from first contact and through the whole relationship. With products becoming commoditized, price differentiation no longer sustainable and customers demanding more, companies and communication service providers (wire line, wireless, broadband cable, satellite) in particular are focusing on delivering superior customer experiences.

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3. CRM MODEL

The basic customer relationship management model for a small business or any business for that matter contains a set of seven basic components. The following dicusses each component:

1. A database for customer activity - Ideally the database should contain information about the following: o Transactions - including a complete purchasing history with accompanying details o Customer contacts from multiple channels and contexts
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Descriptive information for segmentation and other data analysis purposes Response to marketing stimuli - whether or not the customer responded to a direct marketing initiative, a sales contact, or any other direct contact This data should also be collected over time.

2. Analyses of the database - For many years customer databases have been analyzed with the intent to define customer segments. However, taking a larger number of customers and forming groups or segments presumes a marketing effort towards an 'average' customer in the group. With the range of marketing tools available that can reach customers one at a time through personalized messages, there is less need to consider the usual market segmentation schemes. Instead there is an increase in attention being paid to understanding each "row", or customer, of the database, and what he or she can deliver to the company in terms of profit. The idea is that each row/customer of the database should be analyzed in terms if current and future profitability to the firm. 3. Given the analyses, decisions about which customers to target- Looking at past and current purchases a model of the profitability of a customer can be used by the marketing manager to target specific customers. The profit that a customer has produced for the firm is the sum of the margins of all products purchased over time less the cost of reaching that customer. These costs include any that can be broken down at the individual customer level such as direct mail, sales calls etc. Cross-selling is also becoming of interest to marketers, with complementary products being displayed on the same physical page in a hard-copy catalogue or virtual page on a Web site. 4. Tools for targeting the customers - Once the construction and analysis of the customer information contained in the database has been completed, the next step is to consider which customers to target depending on the firms marketing programs. This could be through segmentation, with the customers in the most desired segments targeted first. Individual customers could be targeted that are projected to be profitable for the company. The goal is to use the customer profitability analysis to separate customers that will provide the most long-term profits from those that are currently hurting profits. Mass marketing is useful for generating awareness, but is poorly-suited for CRM due to its impersonal nature.
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Rather than talking "at" customers companies are urged to talk "to" their customers. In particular, "1-to-1" marketing has come to mean using the Internet to facilitate individual relationship building with customers. 5. How to build relationships with the targeted customers - The overall goal of relationship programs is to deliver a higher level of customer satisfaction than competing firms deliver. Research has shown that there is a strong, positive relationship between customer satisfaction and profits. Relationship programs include: o Customer service: With more choices available for customers today, customer service must receive a high priority within the company. Any contact or "touch point" that a customer has with a firm is a customer service encounter and has the potential to gain repeat business and help CRM or have the opposite effect. o Loyalty/Frequency Programs: Loyalty programs provide rewards to customers for repeat purchasing. However, a recent McKisey study identified the three leading problems with these programs: they are expensive, mistakes can be difficult to correct as customers see the company as taking away benefits, and also there are large questions about whether they work to increase loyalty or average spending behavior. A further problem is that due to the ubiquity of these programs, it is increasingly difficult to gain competitive advantage. o Customization: This notion implies the creation of products and services for individual customers, and not simply communicating with them as with 1-to-1 marketing. o Community: The Internet is allowing both online and offline businesses to build a network for exchanging product-related information and to create relationships between the customers and company or brand. The goal is to take a prospective relationship with a product and turn it into something more personal. This allows the manager to build an environment which makes it more difficult for the customer to leave the "family" of other people who also purchased this product. 6. Privacy issues - A CRM strategy as described in this paper depends upon a database containing customer information and the analysis of this data to achieve more effective targeting of marketing communications and relationship-building activities. With the increase in the popularity of the Internet, many consumers and advocacy groups are concerned about the amount of personal information necessary to enable this delivery. The current debate
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about privacy centers around how much control Web surfers should have over their own information.

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4. LOYALTY PROGRAM
How can a loyalty program benefit Bata? Build a long lasting relationship with the customer go beyond product satisfaction to overall brand experience create an emotional connect through simple use full services

Designing the program A retail customer- middle class and higher segments Strategy Award loyalty with a suite of discounts, offers services Primary use of points for determining level of discounts/offers and determining grade Secondary use for services Points earn & burn from partners

Grades based on: Number of purchases value of purchase regularity of purchase Benefits based on: Personalized discounts/ offers Simple useful services moments of delight

Possible benefits Personalized offers Personalized offers based on patterns Based on sku pattern, personal events

Discount top up based on grade Additional 2%-4% discount above general discount
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 Accelerated point accumulation based on grade Other Possible benefits Possible benefits- moments of delight o Delivery of sku not in stock o Free home delivery for any purchase value o Guaranteed time delivery Phone delivery Partner offers(movie tickets, fun park, gift vouchers, special gifts)

Possible loyalty returns Lifelong customer relationship Creating advocacy- reducing marketing spend Increasing on-the-spot spends Use patterns for stock planning

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5. ACQUISITION & RETENTION STRATEGY

Bata have adopted customer relationship management (CRM) systems that can support both acquisition and retention by gathering data from every contact with prospects and customers. Just collecting data should not be an end unto itself, however. The real focus should be on developing a data strategy and tuning the CRM system to help your company acquire and retain the right types of customers. Supporting Acquisition The goal for the acquisition phase of your program should be deciding which prospects most closely match your companys "ideal prospect" profile, but you should also decide which prospects dont meet your criteria for acquisition and eliminate them up front. This simple decision helps focus your marketing and acquisition efforts while saving costs and increasing your return on investment (ROI). Analyzing your marketing campaigns to determine which are most effective in bringing in new customers is also important. A CRM system that is able to tag data (assigning each contact to a specific campaign) lets you analyze the return on the investment you are making in your marketing effort as well as its overall effectiveness in identifying likely prospects. Another benefit of tagging is that it lets you look at marketing programs and their related expenses by leads generated, customers acquired, and potential and realized revenue. This will enable your company to better tailor campaigns to individual customers and prospects based on response or effectiveness rates. When Prospects Become Customers As the focus of your program shifts from acquisition to retention, the goals become those of establishing loyalty, advancing the relationship and building a sense of community, participation and affinity. As with prospecting, however, the data strategy should also help determine whether customers do or dont meet the companys criteria for retention. Look for factors that will feed back into the acquisition cycle to reduce marketing costs, increase success rates or both. Look for trends in the length of customer relationships and determine if steps can be taken to avert the loss of customers at critical points along the way. Even a small improvement in retention can result in a significant rise in profitability and your overall ROI.

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Since all organizations continually update customer data, reviewing and analyzing the data will identify opportunities where up-selling, cross- selling and service sales can be increased. Sales data, for instance, can indicate which customers are due for product/service upgrades or warranty extensions. The development of the data strategy as it relates to retention issues should address questions such as:

What characterizes our best customers, and what keeps them loyal? How do the information and service needs of new customers differ from those of established customers? Is it necessary to keep all prospect information once a customer relationship is established? What changes does the organization need to make as the relationship goes along? Were any products returned and why? How many service calls did customers place? How were they resolved? What was the time to resolution on those calls? What is the potential for developing other customers such as these? Why does one group or class of customer respond to opportunities when another does not?

Choice of a CRM Platform A companys choice of a CRM solution will affect its ability to collect, analyze and use data. A balanced CRM solution should offer the functionality the organization needs and provide the agility to help users address changing demands in the marketplace. The ideal CRM solution should be timely in that it is quick to install and deploy, and it should be cost-effective from its initial deployment through its long- term use. All information about a particular customer should be in one database (not separate databases for marketing, sales or support), and everyone in the organization should be looking at the same data. Universal access to information by all departments makes it possible to present a unified face to each customer. In addition, the CRM solution should be customizable to reflect the unique business outlook and preferences of the organization using it. It should be readily reconfigurable to record new types of information or to discontinue collecting information that is no longer relevant or is not useful. In short, it should be adaptable to new requirements as the needs of the organization evolve.
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Todays Internet technology enables companies to use customized relationship management services hosted by application service providers (ASPs). An Internet-based solution can make it easy for prospects and customers to use self-service tools and information request forms via the Web. The CRM solutions offered by the best ASPs include management and administrative tools to monitor application usage and provide expected levels of service. Developing an effective data strategy for the CRM process is a way to develop the information you need to better run your company. Ultimately, it comes down to deciding who you want to pursue as prospects and retain as customers. Your CRM solution should provide you with the tools and flexibility to support that quest on an ongoing basis. Intelligent analysis of data can indicate whether a companys activities are in line with its goals for customer acquisition and retention. It can be crucial to both the speed and the quality of the companys response, and it can influence the future direction of your product and service offerings. Most importantly, a well-developed data strategy and its effective use in concert with your CRM system will allow you to be selective in the types of customers with whom you choose to deal Revamped website and home delivery options to lure more customers: During Q3CY10, the Company announced the launch of its Bata Home Delivery service under which the customers can now place orders for any footwear, which they are unable to find in a Bata store and have it home delivered through courier. This is a limited period free of cost service provided by BIL for Its customers. Along with Home Delivery service, the Company also launched its new website at www.bata.in, which provides consumers the option of browsing the extensive range of footwear by Bata and also buying on line. The website highlights Batas latest collections that are in sync with the current fashion trends in vogue world over,

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besides the bestsellers from the brand. The following chart depicts the revamped Bata website of BIL:

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6. ADVERTISEMENT
While looking at data for individuals can help you better understand their needs and interests, analyzing data in the aggregate can show which groupings or classes of customers respond best to your companys campaigns. This step can help you develop products or services that meet the needs of specific groups of customers or prospects. There are a number of other questions you should consider as you develop the acquisition part of the data strategy. For example:

What is our best source of customers? Did they find us on their own initiative or were they referrals? Did they come from external sources such as a direct marketing list or were they from our own marketing campaigns? When customers first contact us, what information are they interested in? What was the ROI for that campaign? Was it self-service or assisted interaction that eventually leads to a sale?

The absence of certain types of inquiries should also be investigated. For instance, why are there no Web inquiries from groups of prospects that you know are part of your regular customer base? Analyzing the use of self support via the Web (such as searches of the knowledge base or support cases initiated) allows you to see where customers interests lie and where self support can be improved. Keep in mind that prospects may have significantly different information and support needs than customers and use this knowledge to tailor your acquisition program to their needs. Finally, consider how well the company is responding to prospects. As an example, data may indicate that inquiries responded to within 30 minutes are twice as likely to result in sales than those responded to the next day. This type of analysis can reveal areas where the companys performance can be improved. The competition: Baa shoes like no others Using a cellular phone as a mobile camera has become usual for many people and it is possible to use the widespread of the modern mobile technology for business objectives. Here is an example of using mobile phones with a camera for an online competition.

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Bata is one of the world's leading footwear retailers and manufacturers with operations across 5 continents, according to the Bata international website. The Bata company may organize a new competition for its customers with a business objective to increase sales and learn customers about the different models of their shoes. The key process of the competition is:

The campaign includes principles of the guerrilla marketing by using unexpected technological process and motivates to join community of active Bata customers who are competing to win reward. The objectives of the campaign are to increase the attractiveness of the brand, increase attention on the products and increase sales. The campaign uses principles of presence marketing to stimulate the target audience to learn about the differences between Bata products and products of other manufacturers. Limitations of the campaign can be identified in the technical demands for comprehensive system for managing all relevant data and promotion of such campaign that would consequently increase the budge for marketing activities of the company.

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7. CRM PERFORMANCE MATRIX

Metrics for measuring the success of the CRM process - As more attention is paid to CRM, the traditional metrics used by managers to measure the success of their products and services in the marketplace have to be updated. Some of the CRM-based measure in both Web and non-Web based businesses are as follows:
o o o o o o

Customer acquisition costs Conversion rates (from lookers to buyers) Retention /churn rates Same customer sales rates Loyalty measures Customer share or share of requirements (the share of a customer's purchases in a category devoted to a brand).

All of these measures imply doing a better job through acquiring and processing internal data and focusing on how the company is performing at the customer level. Determine customer value One of the difficulties in CRM implementation is how to identify the customer value. First of all, the company must determine the value of each customer. It is the fundamental ingredient of customer segmentation. By introducing the DCP (Discounted Customer Profitability) model. However, by formally considering the components of customer profitability, the company can develop a more intricate understanding of where the profit opportunities reside. The author argued that customer profitability should include the following components: Annual sales, Gross income, Costs to interface, Net customer profitability, Expected length of relationship and Discounted customer profitability. Discounted customer profitability (DCP) reflects the comprehensive image of a customer value. Also, these components have some relationship with each other. Gross income-Costs to interface=NCP, NCP*Expected length of relationship=DCP. Plugging in the real data of each customer into DCP model, companies can at least get a relative importance of each customer and thus determine which customer is more valuable than others. After determining each customer value, companies are then interested in how to keep those profitable customers. The author stated seven routes to lock in the core
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profitable customers, which are as follows: 1. Achieve and surpass current expectations 2. Elevate the relationship 3. Bond the customer to the companies 4. Prepare for future needs 5. Manage customers which are in decline 6. Reward loyalty 7. Never believe that a core customer is safe First, the companies should listen carefully to the customers needs and perceive the performance of their competitors. Companies can win back customers only when they surpass their competitors performance. Merely satisfying its customer is not enough because the competitor may do it better. Elevating the relationship means that companies should make their status with the core customers from an available supplier to an approved supplier, and then to a preferred supplier, finally to a partner. The higher the suppliers status, the longer the relationship with customers can last. Bonding the customer to the company suggests a multi-link between the customer and the company. Besides the simple communication between the sales and purchasing staffs of a company and its customer, more linkages should be established between both the top managements and R&D staffs of two organizations. Companies can be obsessed with satisfying current customer needs but fail to consider future requirements. Yet the majority of a customers DCP resides in the future rather than the present. Therefore, the author reminds that companies must think about the core customer of the future and involve customer in the R&D. The author claimed that it is easier to recover an account in decline than when it has already terminated business. Therefore, companies should spot the problem, which causes the decline of the core customers, and make a response as soon as possible. Also, the author suggested that companies should give a reward to those core customers to encourage loyalty. The ideal reward should have a relevance to the companies core business and make customers feel that they have been rewarded. In addition, those rewards should have an effect on promoting loyalty and be justified with the total cost.
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Finally, the author reiterated that companies have to be constantly on their guard to those most profitable customers. Complaints from customers are important because the quiet customers are more easily to leave for your competitors. Links among service quality, satisfaction and customer retention Quality, by its definition, is the measurement whether customers enjoyment of it exceeds their perceived value of the money they paid for the products or services. Poor quality usually decreases profitability by increasing costs (both visible and invisible). One of the better known quality models, the SERVQUAL instrument is a 22-item scale that measures service quality along five factors, namely reliability, responsiveness, assurance, empathy and tangibles. This forms the foundation on which all other works have been built. Interestingly, the conceptualization, dimensionality, operationalization, measurement and applications of SERVQUAL have been subjected to some severe criticisms as well . In spite of such reprehension on the efficacy of SERVQUAL across different service settings, there is a general agreement that the 22 items are reasonably good predictors of service quality in its wholeness. But a careful scrutiny of the 22 items reveals that the items at large deal with the element of human interaction/intervention in the service delivery and the rest on the tangible facets of service (such as the effect of atmospherics, design and dcor elements, appearance of equipment, employee appearance, etc.). Therefore the SERVQUAL instrument seems to have overlooked some other important factors of service quality, namely the service product or the core service, systematization/standardization of service delivery (the non-human element), and the social responsibility of the service organization. Although there is a general conformity on the distinctiveness of service quality and customer satisfaction from a conceptual point of view, the operationalization of customer satisfaction is somewhat hazy. we can conclude that customer retention is subjected to the following factors: customer age (or life cycle), relationship depth, satisfaction, price sensitivity and competition environment. The mathematics form for the relationships is: Customer Retention (CR)=f (customer life cycle, relationship depth, satisfaction, price sensitivity, competition environment) Among the five factors, four of them (customer life cycle, relationship depth, price sensitivity, competition environment) are very objective or hard to change by the vendor. But 3PL companies still can do something to improve customer satisfaction and thus increase the retention level.

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Business character of BATA BATA Customer base customer type customer segmentation customer location Product features products cost structure replacement Product input quality control Relationship relationship can be terminated anytime Now focus more on support customer satisfaction service level tangible and easy to measure Simple easy capital and knowledge Easy group or individual Simple Worldwide

Indicators of three satisfaction levels in BATA BATA A good performance product at a Core business reasonable price Support service 24 hrs technique support, repair service, easy price check and order, on time delivery Customized PC for different customers, help customer realize the maximum benefit at a minimum cost

emotional

Here the good performance means both high quality and reliability. Most manufacturers can reach the expectation in this level now, thus it is hard to distinguish between all the competitors in this level currently. Competition has moved to the second satisfaction levelsupport service, which includes both pre-sales and after-sales service, easy order and on-time delivery.

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8. FEEDBACK

FORM

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9.

REFERENCES
1. http://www.bata.com/shoe-customer-service.php# 2. www.wikipedia.com 3. http://www.hdfcsec.com/Research/ResearchDetails.aspx?report_id=2973787

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