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CUSTOMER RELATIONSHIP
MANAGEMENT
 What Is Customer Relationship
2
Management?

a company-wide business strategy designed

to optimize profitability, revenue, and customer
satisfaction by focusing on highly defined and
precise customer groups.
 OBJECTIVES
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1. Contrast transaction-based marketing with

relationship-based marketing.
2. Identify and explain the four basic elements of
relationship marketing, as well as the importance
of internal marketing.
3. Identify the three levels of the relationship
marketing continuum.
4. Explain how firms can enhance customer
satisfaction.
 OBJECTIVES
4

5. Describe how companies build buyer-seller

relationships.
6. Explain customer relationship management (CRM)
and the role of technology in building customer
relationships.
7. Describe the buyer-seller relationship in B2B
marketing and identify the four types of business
partnerships.
 CUSTOMER RELATIONSHIP
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MANAGEMENT STRATEGY
Organize the company around customer segments

Encourage and track customer interaction with the company

Foster customer-satisfying behaviors

Link all processes of the company from its customers

through its suppliers

Allows companies to tightly focus in on their target markets

 RELATIONSHIP MARKETING
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 Focuses on long term rather than short term

 Emphasizes retaining customers over making a sale
 Ranks customer service as a high priority
 Encourages frequent customer contact
 Fosters customer commitment with the
firm
 Bases customer interactions on cooperation and trust
 ELEMENTS OF RELATIONSHIP
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MARKETING

 Firms build long-term relationships in four ways

 Gather information about their customers
 Analyze the data and use it to modify the marketing
mix
 Monitor interactions with customers

 Use customers’ preferences and knowledge

 INTERNAL MARKETING
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External customers - People or

organizations that buy or use a firm’s
goods or services

Internal customers - Employees or

departments within the organization whose
success depends on the work of other
employees or departments
 PURPOSE OF CRM
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• Why we need CRM

• Defining CRM
• Identifying different customer types
• Developing customers i.e. Loyalty programs
• A buzz phrase…with meaning
• Good CRM has a sophisticated database
• Management of customers –
don’t have to be passive recipients of their behavior
 ADVANTAGES OF CRM
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 While company is quickly growing, customers are

more satisfied as well
 Service provided in a better way, and a quicker way
 Sales force automated
 Integrated customer information
 Certain processes eliminated
 Operation cost cut, and time efficient
 Brand names more quickly established
 A central database so that everyone in your company
can keep track of customer contacts
 DISADVANTAGES
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 Organizational wise change of priority to customers.

 Significant investment of time and money
 Threatens management’s control/power struggle
 Heightens people’s resistance to change
Inappropriate integration leads to disaster
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SUPPLY CHAIN MANAGEMENT

 SUPPLY CHAIN MANAGEMENT
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 A supply chain is a set of organizations directly linked by one

or more of the upstream and downstream flows of products,
services, finances, and information from a source to a
customer. Managing a supply chain is 'supply chain
management'
 Supply chain management (SCM) is the management of a
network of interconnected businesses involved in the ultimate
provision of product and service packages required by end
customers. Supply chain management spans all movement
and storage of raw materials, work-in-process inventory, and
finished goods from point of origin to point of consumption
(supply chain).
 WHAT CAN SUPPLY CHAIN
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MANAGEMENT DO?
 Estimated that the grocery industry could save $30 billion (10% of operating cost)
by using effective logistics and supply chain strategies
 A typical box of cereal spends 104 days from factory to sale
 A typical car spends 15 days from factory to dealership
 Faster turnaround of the goods is better?

 Laura Ashley (retailer of women and children clothes) turns its inventory 10 times a
year five times faster than 3 years ago
 inventory is emptied 10 times a year, or an item spends about 12/10 months in the
inventory.
 To be responsive, it relocated its main warehouse next to FedEx hub in Memphis, TE.

 National Semiconductor used air transportation and closed 6 warehouses, 34%

increase in sales and 47% decrease in delivery lead time.
 SUPPLY CHAIN MANAGEMENT
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 THE SUPPLY CHAIN
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Manufacturers Warehouses &
Suppliers Customers
Distribution Centers

Transportation Transportation
Costs Costs
Material Costs Transportation
Manufacturing Costs Inventory Costs Costs
 FLOWS IN A SUPPLY CHAIN
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Material

Information
Supplier Customer
Funds

The flows resemble a chain reaction.

 IMPORTANCE OF SUPPLY CHAIN
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MANAGEMENT
 In 2000, the US companies spent $1 trillion (10% of GNP) on supply-related
activities (movement, storage, and control of products across supply chains).
Source: State of Logistics Report

Frequent Supply shortages Low order fill

Inefficient rates
logistics
High
Tier 1 Manufacturer Distributor Retailer Customer stockouts
Supplier

Glitch-Wrong Material, Ineffective

Machine is Down – High inventories High landed costs to
through the chain promotions the shelf
effect snowballs

 Eliminating inefficiencies in supply chains can save millions of $.

 CYCLE VIEW OF SUPPLY CHAINS
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Customer
Customer Order
Cycle
Retailer
Any cycle
Replenishment Cycle 0. Customer arrival
1. Customer triggers an order
Distributor 2. Supplier fulfils the order
3. Customer receives the order
Manufacturing Cycle

Manufacturer
Procurement Cycle
Supplier
 SUPPLY CHAIN FOR
SERVICE PROVIDERS
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 More difficult than manufacturing

 Does not focus on the flow of physical goods
 Focuses on human resources and support services
 More compact and less extended
 EFFECTIVE SCM
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 Managing flow of information through supply

chain in order to attain the level of
synchronization that will make it more responsive
to customer needs while lowering costs
 Keys to effective SCM
 information
 communication
 cooperation
 trust
 SUPPLY CHAIN MANAGEMENT (SCM)?
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Plan Source Make Deliver Buy

 A set of approaches used to efficiently integrate

 Suppliers
 Manufacturers
 Warehouses
 Distribution centers
 So that the product is produced and distributed
 In the right quantities
 To the right locations
 And at the right time
 System-wide costs are minimized and
 Service level requirements are satisfied
 HISTORY OF SUPPLY CHAIN
MANAGEMENT
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 1960’s - Inventory Management Focus, Cost Control

 1970’s - MRP & BOM - Operations Planning
 1980’s - MRPII, JIT - Materials Management, Logistics
 1990’s - SCM - ERP - “Integrated” Purchasing,
Financials, Manufacturing, Order Entry
 2000’s - Optimized “Value Network” with Real-Time
Decision Support; Synchronized & Collaborative
Extended Network
 CONCLUSION
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 Supply chain management (SCM) is the

management of a network of interconnected
businesses involved in the ultimate provision of
product and service packages required by end
customers.
 Managing flow of information through supply
chain in order to attain the level of
synchronization that will make it more
responsive to customer needs while lowering
costs
 BIBILOGRAPHY
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 https://www.slideshare.net/jaiserabbas/customer-
relationship-management-crm-10974369
 https://studymafia.org/customer-relationship-
management-seminar-ppt-with-pdf-report/
 https://www.slideshare.net/mundirikasah25/ppt-
of-crm-12678251
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