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CRM MATRIXCRM MATRIX
By:- Dr. Ramikshen Y.By:- Dr. Ramikshen Y.
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How Relationships are builtHow Relationships are built
Relationships are built on trust.Relationships are built on trust.
Three stages of building relationshipThree stages of building relationship
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ABC of RelationshipsABC of Relationships
First you First you acceptaccept a relationship a relationship
Acceptance Belief CommitmentRelationship
Bond
Your Your beliefbelief in that relationship leads to a in that relationship leads to a sense of sense of commitmentcommitment to that relationship. to that relationship.
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Then you start Then you start believingbelieving in that relationship. in that relationship. If you do not believe, you can not continue If you do not believe, you can not continue the relationship further. If you believe, you the relationship further. If you believe, you will nurture the relationship. will nurture the relationship.
Two elements are Two elements are merged merged together to form together to form relationship/bondrelationship/bond
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Customer Relationship MatrixCustomer Relationship Matrix
Two elements of relationship are:Two elements of relationship are:1.1. Commitment Commitment in relationshipin relationship
2.2. Acceptance Acceptance of relationshipof relationship..
Based on this, four customer relationship Based on this, four customer relationship styles are developed. styles are developed.
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Customer Relationship MatrixCustomer Relationship Matrix
Four relationship styles are:
1. Golf-Hole Relationship
2. Rail Track Relationship
3. Telephone Booth Relationship
4. Honey Bee Relationship
Customer Relationship MatrixCustomer Relationship Matrix
COMMITMENT
AC
CE
PT
AN
CE
GOLF - HOLE RAIL TRACK
TELEPHONE BOOTH HONEY BEE
LOW HIGH
HIGH
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CR Matrix: CR Matrix: Golf-HoleGolf-Hole(Low commitment & low acceptance)
Objective: To increase the sales
Strategy: Put the ball (customer) into the hole (place/offering) anyhow
Approach: Ad-hoc, Short-term, price leadership
Loyalty: Service provider is the only player in the industry, customers are price conscious, loyal to the service provider with lowest price.
Outcome: Increase in revenue but opportunistic relationship with customers, neutral word of mouth
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CR Matrix: CR Matrix: Rail TrackRail Track(High commitment & low acceptance)
Objective: To increase sales based on constraints, switching cost
Strategy: Like two rails of a track, they run together/ parallel but never meet
Approach: Focused
Loyalty: Customers are unable to seek alternative service provider
Outcome: Customers buy the product because of commitment but negative word of mouth.
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CR Matrix: CR Matrix: Telephone BoothTelephone Booth(Low commitment & high acceptance)(Low commitment & high acceptance)
Objective: To increase sales based on product availability at affordable cost.
Strategy: Telephone booths are used irrespective of their condition & brand.
Approach: Extensive distribution, convenience
Loyalty: Loyalty due to convenience factors (location), habitual
Outcome: Products get sold because of convenience, positive word of mouth
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CR Matrix: CR Matrix: Honey BeeHoney Bee(High commitment & high acceptance)
Objective: To build & maintain meaningful mutually beneficial relationship to increase the sales
Strategy: All bees have relationship with the queen bee and strong commitment towards her. They live together (mutual benefit).
Approach: Long-term, Customisation
Loyalty: Loyalty as a consequence from emotional attachment to the service provider/ product.
Outcome: Stronger brand. Customers buy the product because of relationship bond, positive word of mouth
Relationship Styles & 4CsRelationship Styles & 4Cs
Compromise Constraints
Convenience ContentmentBoth have High Commitment but reasons are different
Both have High Acceptance but reasons are different
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Do we need to manage the Do we need to manage the relationship?relationship?
Why do business relationships have to be Why do business relationships have to be managed anyway? It seems so planned or managed anyway? It seems so planned or deliberate. deliberate.
Why can't they just happen and evolve in Why can't they just happen and evolve in their own way?their own way?
We do our job, customers do theirs, and We do our job, customers do theirs, and somehow we meet in the middle.somehow we meet in the middle.
Sadly, it doesn't work that way. Sadly, it doesn't work that way.
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Managing RelationshipManaging Relationship
Managing customers effectively does Managing customers effectively does mean a bit of calculation, premeditation mean a bit of calculation, premeditation and work on our part. and work on our part.
Managing business relationships means Managing business relationships means that we become aware of changing needs, that we become aware of changing needs, of difficulties that arise or of issues that of difficulties that arise or of issues that need resolving. need resolving.
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How to manage the relationshipHow to manage the relationship
Everyone has had the experience of ending a Everyone has had the experience of ending a phone conversation or leaving a meeting phone conversation or leaving a meeting thinking how much better the discussion would thinking how much better the discussion would have gone 'if only' the customers had been more have gone 'if only' the customers had been more co-operative or understood more. co-operative or understood more.
It seems so logical to imagine that things really It seems so logical to imagine that things really would improve if only the customers could see would improve if only the customers could see the situation the way we see it. the situation the way we see it.
However much we may wish it, it just doesn't However much we may wish it, it just doesn't work that way.work that way.
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Expectations from RelationshipExpectations from Relationship
Understanding CustomersUnderstanding Customers
Company(Seller/Provider)
CUSTOMERS
Expectations
Expectations
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Who is managing the relationship?Who is managing the relationship?
CUSTOMER MANAGED RELATIONSHIP
C R MCustomer Relationship Management
Are we managing the relationship?
Are we being managed by the customers?
In a business relationship it is important to understand that who is managing the relationship.
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Developing RelationshipsDeveloping Relationships
Understanding the value of relationshipUnderstanding the value of relationship
Creating values in relationshipCreating values in relationship
Delivering value in relationshipDelivering value in relationship
Keeping the relationship dynamicKeeping the relationship dynamic
Developing RelationshipDeveloping Relationship
COMMITMENT
AC
CE
PT
AN
CE Simple
Relationship
EnduringRelationship
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Developing RelationshipDeveloping RelationshipVia Acceptance RouteVia Acceptance Route
Golf Hole →Telephone Booth → Honey Bee
Implement marketing activities to increase customers commitment to the brand/ offering/ company/ channel
Enable the customer
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Golf Hole Golf Hole →→ Rail Track → Honey Bee Rail Track → Honey Bee
Implement marketing activities to increase Implement marketing activities to increase customer’s acceptance of the customer’s acceptance of the brand/product/service brand/product/service
Add value to the offering Add value to the offering
Developing RelationshipDeveloping RelationshipVia Commitment RouteVia Commitment Route
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ConclusionConclusion
Most of the customers have Golf-Hole type of Most of the customers have Golf-Hole type of relationship with the sellers/providers. relationship with the sellers/providers. Companies (sellers/providers) can build enduring Companies (sellers/providers) can build enduring relationship (Honey Bee type) with its customers relationship (Honey Bee type) with its customers through Acceptance or Commitment route. through Acceptance or Commitment route. CR Style matrix provides an insight toCR Style matrix provides an insight to the the customer’s behaviour, enabling tactical and customer’s behaviour, enabling tactical and strategic actions to be taken by sales, product strategic actions to be taken by sales, product development and marketing to meet customer development and marketing to meet customer needs & expectationsneeds & expectations