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The biggest management challenge in the new millennium of liberalization and

globalization for a business is to serve and maintain good relationship with the
king the customer.
In the past producers took their customers for granted, because at that time the
customers were not demanding nor had alternative source of supply or
suppliers. But today there is a radical transformation. The changing business
environment is characterized by economic liberalization, increasing
competition, high consumer choice, demanding customer, more emphasis on
quality and value of purchase etc. All these changes have made today’s
producer shift from traditional marketing to modern marketing. Modern
marketing calls for more than developing a product, pricing it, promoting it and
making it accessible to target customer. It demands building trust, a binding
force and value added relationship with the customers. The process of
developing a cooperative and collaborative relationship between the buyer and
seller is called customer relationship management shortly called CRM.
CRM (customer relationship management) is an information industry term for
methodologies, software, and usually Internet capabilities that help an
enterprise manage customer relationships in an organized way. For example, an
enterprise might build a

database about its customers that described relationships in sufficient detail so

that management, salespeople, people providing service, and perhaps the
customer directly could access information, match customer needs with product
plans and offerings, remind customers of service requirements, know what other
products a customer had purchased, and so forth. According to one industry
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
 The CRM is a new technique in marketing where the marketer tries to
develop long term relationship with the customers to develop them as life
time customers. CRM aims to make the customer climb up the ladder of
 The company first tries to determine who are likely prospects i.e. the
people who have a strong potential interest in the product and ability to
pay for it.
 The company hopes to convert many of its qualified prospect into first
time customers and then to convert those first time customers into repeat
 Then the company tries to convert these repeat customers into clients –
they are those people who buy only from the company in the relevant
product categories. The next challenge for the company is to convert
these clients into advocates.
 Advocates are those clients who praise the company and encourage
others to buy from it. The ultimate challenge is to convert these advocates
into partners where the customers and the clients work actively together
to discover ways of getting mutual benefit.
 Thus in CRM the key performance figure is not just current market share
but share of life time value by converting customers into partners. In
CRM the company tries to identify that small percentage (20%) of key
account holders whose contribution to the company revenues is high
(80%). So from this point of view, CRM is also known as KEY
 A satisfied customer in 10 years will bring 100 more customers to the
 It costs 7 times more to attract a new customer than to serve an old one.
 20% of the company’s loyal customer’s account for 80% of its revenues.
(Pareto’s principle).
 The chances of selling to an existing customer are 1 in 2; the chances of
selling to a new customer are 1 in 16.


A Customer Relationship Management system may be chosen because it is

thought to provide the following advantages:
 Quality and efficiency
 Decrease in overall costs Decision support
 Enterprise ability
 Customer Attentions
 Increase profitability
 Improved planning
 Improved product development


CRM software provides a business with the ability to create, assign and manage
requests made by customers. An example would be Call Centre software which
helps to direct a customer to the agent who can best help them with their current
problem. Recognizing that this type of service is an important factor in
attracting and retaining customers, organizations are increasingly turning to
technology to help them improve their clients’ experience while aiming to
increase efficiency and minimize costs. CRM software can also be used to
identify and reward loyal customers which in turn will help customer retention.
Even so, a 2009 study revealed that only 39% of corporate executives believe
their employees have the right tools and authority to solve client problems.

Increase in customer retention Customer satisfaction ratings improved Service

calls deflected from call center to online forum Reduction in overall customer
service costs


CRM systems for marketing help the enterprise identify and target potential
clients and generate leads for the sales team. A key marketing capability is
tracking and measuring multichannel campaigns, including email, search, social
media, telephone and direct mail. Metrics monitored include clicks, responses,
leads, deals, and revenue. Alternatively, Prospect Relationship Management
(PRM) solutions offer to track customer behaviour and nurture them from first
contact to sale, often cutting out the active sales process altogether. In a web-
focused marketing CRM solution, organizations create and track specific web
activities that help develop the client relationship. These activities may include
such activities as free downloads, online video content, and online web
presentations Product- or company-related postings Positive product comments,
reviews Visitors following link from social channel to online store’s URL
Visitors referred to website from online friend



Involves using software to streamline all phases of the sales process,

minimizing the time that sales representatives need to spend on each phase. This
allows a business to use fewer sales representatives to manage their clients. At
the core of SFA is a contact management system for tracking and recording
every stage in the sales process for each prospective client, from initial contact
to final disposition. Many SFA applications also include insights into
opportunities, territories, sales forecasts and workflow automation. More sales
lead with expressed interest or need Increase in referrals Reduce cost per lead
acquired Key social influencers identified and engaged (invited to write a blog,
for instance, or otherwise participate in a company’s online community) Overall
increase in online sales and/or online customers High response rate to coupon or
promotion offered on Face book or other social channel Increased purchasing
from social channel visitors vs. regular online visitors


New ideas for future products or services generated via contests or “crowd
sourcing,” in which online groups brainstorm and then vote on best ideas
Responses to online surveys to vote on new product features or upgrades

Horizontal vs. Vertical:-

Major CRM vendors offer horizontal CRM solutions. In order to tailor a
horizontal CRM solution, companies may use industry templates to overlay
some generic best practices by industry on top of the horizontal CRM solution.
Horizontal CRM vendors may also rely on value added reseller networks of
systems integrators to build vertical solutions and sell them as 3rd party add-ons
or to come in and customize the solution to fit into a particular scenario.
Vertical CRM vendors focus on a particular industry. As a general rule of
thumb in CRM, it is ten times more costly to build a vertical solution from a
horizontal software program than it is to find a particular vertical solution that is
already tailored to your business model and industry.


Four key steps for putting one to one marketing program to work
Step 1: Identify your customers:
To launch a one to one initiative the company must be able to locate and contact
a fair number of customers or at least a substantial portion of its valuable
customers. It is crucial to know the customer details as much as possible, not
just their names or address, but their habits, preferences and so forth.
Step 2: Differentiating your customers
Customers are different in two principal ways; they represent different levels of
value and have different needs. Once the company identifies its customers
differentiating them will help the company to focus its efforts to gain the most
advantage with the most valuable customers.
Step 3: Interacting with the customer
Interaction is also a crucial component of a successful CRM initiative. It is
important to remember that interaction just not occur through marketing and
sales channels, customer interact in many different ways with many different
areas of the organization so to foster relationship all the areas of the
organization must be accessible to the customer.
Step 4: Customize your enterprise’s behaviour
Ultimately to lock a customer into a relationship a company must adapt some
aspect of its behaviour to meet customer’s individually expressed needs this
might mean mass customizing a manufactured product or it might involve
tailoring some aspect of the service surrounding the product.

Successful development, implementation, use and support of customer
relationship management systems can provide a significant advantage to the
user, but often there are obstacles that obstruct the user from using the system to
its full potential. Instances of a CRM attempting to contain a large, complex
group of data can become cumbersome and difficult to understand for ill-trained
users. The lack of senior management sponsorship can also hinder the success
of a new CRM system. Stakeholders must be identified early in the process and
a full commitment is needed f

A firm in paint industry has to maintain good relations with its customers. They
have to retain the customers for a long time to avail the benefit of their relations.
The customer relationship management is one of the effective tools to identify,
establish and maintain relationship with the customers.


 To study the current practices of CRM.

 To find out the impact of CRM on the profitability of the organization.
 To study the factors affecting the CRM practices.
 To study the role of information technology in CRM.


Customer Relationship Management (CRM) has become one of the most
dynamic technology topics of the millennium. According to Chen and Popovich
(2003), CRM is not a concept that is really new but rather due to current
development and advances in information and enterprise software technology, it
has assumed practical importance. The root of CRM is relationship marketing,
which has the objective of improving the long-term profitability of customers
by moving away from product-centric marketing.
Bose (2002) noted that CRM was invented because the customers differ in their
preferences and purchasing

habits. If all customers were alike, there will be little need for CRM. As a result,
understanding customer drivers and customer profitability, firms can better
tailor their offerings to maximize the overall value of their customer portfolio
(Chen and Popovich) .
The attention CRM is currently receiving across businesses is due to the fact
that the marketing environment of today is highly saturated and more
competitive. In term of information technology (IT), CRM means an enterprise
–wide integration of technologies working together such as data warehouse,
web site, and intranet/extranet, phone support system, accounting, sales,
marketing and production.
Kotler (2000) assured that CRM uses IT to gather data, which can then be used
to develop information acquired to create a more personal interaction with the
customer. In the long-term, it produces a method of continuous analysis and
reinforcement in order to enhance customer’s lifetime value with firms. Benefits
of CRM
According to Chen and Popovich (2003), CRM applications have the ability to
deliver repositories of customer data at a much smaller cost than old network
technologies. Throughout an organization, CRM systems can accumulate, store,
maintain, and distribute customer knowledge.
Peppard(2000) noted that effective management of information has a very
important role to play in CRM because it can be used to for product tailoring,
service innovation; consolidate views of customers, and for calculating
customer lifetime value.
According to Swift (2001), companies can gain many benefits from CRM
implementation. He states that the benefits are commonly found in one of these
areas: o Lower cost of recruiting Customers o No need to acquire so many
customers to preserve a steady volume of business o Reduced cost of sales
Higher Customer Profitability o Increased Customer retention & Loyalty o
Evaluation of customers Profitability Past Survey-Facts Growth Strategies
International (GSI) performed a statistical analysis of Customer satisfaction data
encompassing the findings of over 20,000 customer surveys conducted in 40
countries by Info quest. The conclusions of the study were:
1) A Totally Satisfied Customer contributes 2.6 times as much revenue to a
company as a Somewhat Satisfied Customer.
2) A Totally Satisfied Customer contributes 17 times as much revenue as a
Somewhat Dissatisfied Customer.
3) A Totally Dissatisfied customer decreases revenue at a rate equal to 1.8 times
what a Totally Satisfied Customer contributes to a business.
4) By reducing customer defection (by as little as 5%) will result in increase in
profits by 25% to 85% depending from industry to industry. An important facet
of CRM is “customer selectivity”. As several research studies have shown not
all customers are equally profitable (In fact in some cases 80% of the sales
come through 20% of the customers). The company must therefore be selective
and tailor its program and marketing efforts by segmenting and selecting
appropriate customers for individual Marketing Programs.

Research methodology is away to systematically solve research problem. In it
we study the various step that are generally adopted by researcher in studying
his research problem along with logic behind them. It is necessary for a
researcher to know not only the research method/techniques but also the
methodology. It may be noted, in the context of planning & development that
the significance of research lines in its quality and not in quantity. Researcher
should know how to apply particular research techniques, but they also need to
know which of these methods or techniques, are relevant and which are not, and
what would they mean and indicate and why? Meaning of Research “Research
is common parlance refers to a search for knowledge. In fact research is an act
of scientific investigation.” The project was divided in to the following steps.


 This step is also research problem. Problem definition is the most critical
part of the research process. Research problem definition involves
specifying the information needed by management.
 To study the awareness of XENON AUTOMOBILE SPARE PARTS
 To find out the level of customer satisfaction with the offers, discount and

Research design involves defining the research problem, determining how to
collect the data and from whom, establishing the way the data will be analyzed
estimating costs and the preparation of the research approach. For this study,
descriptive research was selected.
A research design is simply a plan for study in collecting and analysing the data.
It helps the researcher to conduct the study in an economical method and
relevant to the problem. Research methodology is a systematic way to solve a
research problem. The methodology should combine economy with efficiency.
Research design
The study conducted here is exploratory cum descriptive.
Scope of the study
The scope of the study is confined to Company.
Collection of the data
There are two types of data.
Primary data
Primary data is that data which is collected for the first time. These data are
basically observed and collected by the researcher for the first time. I have used
primary data for my project work.
Secondary data
Secondary data are those data which are primarily collected by the other person
for his own purpose and now we use these for our purpose secondlrom all
executives before beginning the conversion. But the challenges faced by the
company will last longer for the convenience of their customers. Additionally,
an interface that is difficult to navigate or understand can hinder the CRM’s
effectiveness, causing users to pick and choose which areas of the system to be
used, while others may be pushed aside. This fragmented implementation can
cause inherent challenges, as only certain parts are used and the system is not
fully functional. The increased use of customer relationship management
software has also led to an industry-wide shift in evaluating the role of the
developer in designing and maintaining its software. Companies are urged to
consider the overall impact of a viable CRM software suite and the potential for
good or bad in its use.


The CRM (customer relationship management) is an integrated effort to
strengthen the network of relationship for the mutual benefit of both the parties.
The biggest management challenge in the new millennium of liberalization and
globalization for a business is to maintain good relationship with the king – the
customer. This study is of great significance because
A 5% increase in the customer retention will increase the profit up to
 It costs seven times more to attract a new customer than to serve an old
 20% of the company’s loyal customer’s account for the 80% of its
 To study on customer relationship management would enable the
researcher to know about the CRM practices adopted in the automobile


In today’s intensely competitive, rapidly changing & highly complex business

environment characterized by diminishing customer loyalty, the need to be
market focused & customer centric is more critical than any other time in past.
Firms use technology as a key tool to enhance the information flow within their
business units, helping their employees better understand the ever changing and
increasing need and wants of their customers. It is certain that the internet will
continue to change the ways customers and organizations interact with one
another in terms of speed and ease. This fact requires that the integration of
internet technology into CRM activities occur at all levels throughout the
organization. Thus, it would be wrong to say that keeping its customer satisfied
is in the best interests of the organizations. The purpose of this study is to bring
insight and deeper understanding into the objectives, strategies and the expected
benefits of CRM initiatives by the organization.

Reason for selecting Primary Data

In terms of primary data a questionnaire has been used to interview desire
sample units that give accurate and up to data information as well better to
research problem.
Research approaches:
- Primary data can be collected in five main ways: through Observation, focus
groups, surveys, behavioural data, and experiments.
Research instruments:-
Marketing researchers have a choice of three main research Instruments in
collecting primary data:

A questionnaire consists of questions presented to respondents for their
answers. Because of its flexibility, the questionnaire is by far the most common
Instrument used to collect primary data. Questions can be open-ended or closed-



2.Age of the respondent

a) 18-25
b) 26-30
c) 31-40 ]
d) Above 40
3. Occupation
 Student
 Service
 Business
4. Sex-
a) Male
b) Female
5.Annual Income-
a) < 100000
b) 100000 – 150000
c) 150000 – 200000
d) 200000 – 250000
e) 250000 – 300000
f) >300000

6.through ongoing dialogue, we work with individual key customer to

customize our offerings

a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree

7.yourorganization provides customized services and products to our key


a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree
8.will people in my organization treat key customers with great care.
a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree organization makes an effort to find out what our key customer needs 45
a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree
10.when my organization finds that customers would like to modify a product/
service, the departments makes coordinated efforts to do so

a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree

11.customers centric performance standards are established and monitored at

all customer touch points

f) Strongly Agree
g) Agree
h) Neutral
i) Strongly disagree
j) disagree organization has the sales and marketing expertise and resources to
succeed incrm
a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree
13.our employee training programs are designed to develop the skills required
for acquiring anddeepening customer relationship
a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree
14.My organization has established clear business goals related to customer
acquisition, development, retention and reactivation
a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree
15. My organization commits time and resources in managing customer
relationship 4
a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree
16. Employee performance is measured and rewarded based on meeting
customer needs and onsuccessfully serving the customers
a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree
17. Our organization structure is meticulously designed4
a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree organization has the right personnel to provide technical support for the
utilization of in building customer relationships
a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree organization has the right software to serve our customers 4

a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree
20.organization has the right hardware to serve our customers
a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree

21.Individual customer information is available at every point of contact

a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree

22.My organization maintains a comprehensive database of our customers

a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree

23.customers can expect exactly when services will be performed

4ustomers can expect
that my organizations employees respond to their requests promptly
a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree organizations employees are willing to help customers in a

responsive manner
a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree organization fully understands the needs of our key customers via
knowledge learning
a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree organization provides channels to enable ongoing two-way

communication with our key customers and us
a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree

27.customers can expect prompt service from employees of my

a) Strongly Agree
b) Agree
c) Neutral
d) Strongly disagree
e) disagree