logo image

Customer relationship management

Developing close, co-operative relationship with customers is more important in the current era of intense competition and demanding customers, than it has ever been before. CRM is a strategy that can help them to build long-lasting relationships with their customers and increase their profits through the right management system and the application of customer-focused strategies. CRM is a combination of policies, processes and strategies implemented by an organization to unify its customer interactions and provide a means to track customer information.

It involves the use of technology in attracting new and profitable customers, while forming tighter bonds with existing ones. Customer Relationship Management is a comprehensive approach which provides seamless integration of every area of business that touches the customer-namely marketing, sales, customer service and field support-through the integration of people, process and technology, taking advantage of the revolutionary impact of the Internet.

Customer Relationship Management (CRM) is a fundamental business of every enterprise and it requires a holistic strategy and process to make it successful. (Jagdish N Sheth 2001)[1]. Advancements in technology have made relationship marketing a reality in recent years. Technologies such as data warehousing, data mining, and campaign management software have made customer relationship management a new area where

Need essay sample on "Customer relationship management"? We will write a custom essay sample specifically for you for only $13.90/page

firms can gain a competitive advantage.

Customer Relationship Management is the establishment, development, maintenance and optimisation of long-term mutually valuable relationships between consumers and organizations. CRM is a comprehensive approach which provides seamless integration of every area of business that touches the customer viz., marketing, sales, customer service and field support-through the integration of people, process and technology, taking advantage of the revolutionary impact of the Internet.

CRM is a process or methodology used to learn more about customers’ needs and behaviors in order to develop stronger relationships with them. There are many technological components to CRM,the more useful way to think about CRM is as a process that will help bring together lots of pieces of information about customers, sales, marketing effectiveness, responsiveness and market trends. It helps businesses use technology and human resources to gain insight into the behavior of customers and the value of those customers. The key to customer relationship marketing is to “treat different customers differently,” according to Martha Rogers, a partner in the Stamford, Conn.-based Peppers and Rogers Group. This involves four steps, she said: • Identifying each customer individually.

• Differentiating customers by value to your organization and needs from your organization. • Interacting with customers on a more cost-efficient basis. • Customizing some aspect of your enterprise’s behavior.

Insurance companies today are focused on improving relationships with policyholders, brokers, and agents to increase policies in force and grow share of wallet, while at the same time reducing costs by streamlining internal operations. The key is improving profitability and growing revenues with personalized retention and cross-selling campaigns across multiple channels. There’s also a need to manage changing operations and practices, compete for new customers, maximize customer relationships, leverage existing technology and infrastructure investments

CRM enables insurance companies to increase cross-sell effectiveness and reduce attrition for stronger, more profitable long-term customer relationships. Real-time analytics make it easy to recommend attractive offers during inbound interactions for increased revenue and better retention. Seamless integration with legacy systems and multiple customer channels, including the contact center, provides a single customer service representative desktop for more cost-effective contact center operations.

• To identify the various CRM practices followed by Service Sector. • To examine the customers’ perceptions and the insurers views on various elements of CRM techniques followed by the insurance sectors • To analyse the factors influence the customers

• To highlight the strategies to be followed for success of CRM practices.

Service industry is undergoing tremendous changes; the focus is towards the customer service. The customer is aware of technology and the various service options. Due to these factors, there is heavy competition between insurance companies. Increased competition in the market in the past few years propelled retail insurance companies to focus greatly on maintaining and increasing their customer base while improving customer service quality. In other words customer relationship management has become a major focus for the insurance companies.

Relationship building with customers is now accepted as over-riding goal of marketing and of the business as a whole. In service industries, the goal is especially emphasized since a repeat customer is believed to cost merely a fraction of what needs to be spent in servicing a new customer in service transaction. It is believed that relationships flourish when marketers play by the book, meet customers’ core expectations and exceed in respect of other features of their total offering. Service firms have been the pioneers in adopting the practice of customer relationship management practices. (Shainesh and Ramneesh 2001)[2]

In reality, often products fail to meet the requirements and expectations of the customers resulting in subjective and or objective complaints. The phenomenon is more likely in services where the product is essentially intangible and variable. Services offer only a limited scope of quality correction before they reach customers. As per a preliminary estimate, the intensity of complaint is twice greater in a service product than in the comparable good product.

Today’s insurance companies are under extreme pressure to manage profitability, risk and customer loyalty in a challenging and ever-changing marketplace. As a result, many insurers are pursuing initiatives to take costs out of underwriting and claims operations; to improve customer service functions; and to mitigate various forms of risk. Enterprise Content Integration (ECI) has emerged as a preferred approach for unifying these content silos, providing a single interface to distributed content across the enterprise.

This white paper discusses how ECI can help today’s insurance companies to reduce risk, improve claims and underwriting cycletimes, and dramatically improve customer service. Customer Relationship Management (CRM) is a strategy that can help them to build long-lasting relationships with their customers and increase their profits through the right management system and the application of customer-focused strategies. CRM in the insurance sector is of strategic importance. (Evangelia and Michalis 2006)[3]

According to Peppers & Rogers, great service happens only when you relate to your customers “One to One”. To do that the organizations will have to identify their customers, differentiate them, interact with them, and finally, customize their products or services to meet their needs. This calls for customer relationship management, a tool in the hands of the insurance companies. Obviously, a customer relationship management strategy has numerous aspects, but the theme is for the insurance companies to become more customer-centric. This does not necessarily create a new revenue stream today or even tomorrow. However, it will add customer loyalty to the bottom line of the business.

After telecom and banking, it’s the turn of insurance companies to deploy customer relationship management (CRM) solutions. As competition intensifies, insurers are trying every trick in the book to retain existing customers, with a wide range of services driving the market for CRM applications in the process. While the insurance sector is seeking to maintain a balance between acquiring customers and developing existing ones, customer acquisition is vital, as no retention strategy will entirely stem customer defection.

That said, insurance companies are experiencing unacceptable levels of customer churn, thanks to which they are focusing on keeping the customers they already have in a bid to ensure a net growth in their customer base. Today, the focus is on selling more products to existing customers to improve profitability. Customer-focused strategies require CRM (customer relationship management) to help acquire customers thorough various touch points and translate operational data into actionable insights for proactively serving customers. Vikram G Shah, managing director, Talisma Corporation says, “CRM with BI (Business Intelligence) tools can help insurance firms monitor the ebb and flow of customer behaviour, giving them a holistic 360-degree view of their customers

The traditional customer relationship management approach based around the relationship manager can no longer be sustained without the application of customer relationship management tools and techniques, regardless of whether the organization is targeting the high net worth or the mass affluent customer segments of the market. The relationship manager is like a communication node between the customer and the organization, understanding customers’ needs and preferences, and orchestrating the products and services to meet those needs. When life is simple, the relationship manager needs only to communicate with the customer to have a fully assimilated view of that customer’s activities. The manager’s brain is acting as the customer relationship management tool for storing, processing and evaluating data leading to a customer strategy.

Marketers of either goods or services are constantly reminded to undo any disappointment to the customers and resolve customers’ complaints. The negative word of mouth mentions emanating from the complaining customers is far more damaging and widespread than the recommendations of the satisfied customers.

A competitive environment has always made business to change and improve their process of working. After Manufacturing Resource Planning (MRP), Total Quality Management (TQM), Quality Function Deployment (QFD), Electronic Data Exchange (EDE), Business Process Reengineering (BPR), Enterprise Resource Planning (ERP), Supply Chain Management (SCM), the next three letter mantra which has rewritten the marketing lexicon by driving for a paradigm shift from a traditional transactional marketing to web enabled interactive relationship marketing is Customer Relationship Marketing (CRM).

In recent years, the use of Customer Relationship Management (CRM) solutions as a Knowledge Management (KM) tool has fast become prevalent in sectors such as the telecommunication, finance and insurance industries. (Andrew)[4]. The objectives of CRM would be achieved and benefits reaped by those businessman who can clearly distinguish between the old concepts of customer satisfaction to the newer concept of customer delight. Thus achieving competitive advantage in services requires integration of services marketing with service delivery.

The Insurance companies are facing lot of difficulties in acquiring new customers and in retaining the existing customers. As a result of the advancement of Insurance technology and computerization and networking of insurance branches, the customers are becoming more and more dynamic and less loyal in their behaviour. The development of the Internet is further adding to this trend and the whole market has become transparent and customers are in a position to move easily from one bank to another. In such a situation, analyzing the effectiveness of customer relationship is the key to marketing insurance services which aims at retention of the old customers and their bringing in new customers.

The key to effective CRM is to cultivate meaningful insights about customers-insights that reveal not only what makes the customer satisfied, but also what brings profitability to the organization. Although most companies understand that developing insights about individual customers can increase satisfaction and drive sales, few truly understand which insights are critical, how to use them to deliver value, or how to develop them in the first place. By building intelligence from customer insight, financial services companies stand to reap the benefits of: • Predicting what customers need and want on a more personalized level. • Understanding how much should be invested at the individual customer level. • Understanding how to cost-effectively allocate marketing, sales and service resources. • Measuring the effectiveness of resource allocation decisions. • Driving intelligent decision-making across channels and contact points.

Leading customer-focused companies view every customer interaction as an opportunity to make a new offer, improve retention, increase revenue, build loyalty, or strengthen their brand. Infor CRM (Customer Relationship Management) helps companies optimize customer relationships by integrating marketing, sales, and service. By providing a full 360-degree view of customers, the system enables a consistent and continuous customer dialogue based on real-time information. With this advanced CRM solution set, you can make the most of every interaction with every customer across every channel or touch point. As a result, you gain true customer insight, along with the ability to act on that insight.

Customer expectations are rising: Customers, faced with a dizzying array of insurance products expect customised offerings, value, ease of access, and personalisation from insurers. Today, customers are expecting individual attention, responsiveness, customisation and access. At the same time, they don’t want to pay a premium for these services. High customer expectations and lower exit barriers could lead to increased customer attrition.

Read full document

Can’t wait to take that assignment burden offyour shoulders?

Let us know what it is and we will show you how it can be done!
×
Sorry, but copying text is forbidden on this website. If you need this or any other sample, please register
Signup & Access Essays

Already on Businessays? Login here

No, thanks. I prefer suffering on my own
Sorry, but copying text is forbidden on this website. If you need this or any other sample register now and get a free access to all papers, carefully proofread and edited by our experts.
Sign in / Sign up
No, thanks. I prefer suffering on my own
Not quite the topic you need?
We would be happy to write it
Join and witness the magic
Service Open At All Times
|
Complete Buyer Protection
|
Plagiarism-Free Writing

Emily from Businessays

Hi there, would you like to get such a paper? How about receiving a customized one? Check it out https://goo.gl/chNgQy