INTRODUCTION DEFINITION OF CUSTOMER RELATIONSHIP MANAGEMENT (CRM) Customer Relationship Management (CRM) is the core business strategy that integrates internal processes and function and external network, to create and deliver value to targeted customer. It is grounded by high quality customer-related data and enabled by information technology. CRM is information industry that helps company to manage the relationship between customer and the organization. A company builds a customer database to know their customer better.
This customer database describes relationship in sufficient details so that the organization, management and other related people can access the information easily. The company will understand more about customer’s needs for the product and service so the organization can provide the right product or service to the right customers. Besides, it is also designed to coordinate multiple channels of support for the customer in managing problems, questions and feedback.
It’s a mixture of business processes and technologies with various consumers touch points like sales, marketing, customer support and feedback etc. A best business practice is to know about the customers’ profiles, history, and preferences to confirm for customers that the supplier cares about them. It considers customers needs and behavior, examines profitability and continuous automation process. CRM software is a system that connects different parts of a company through the thread of customer relationships.
Sales, Marketing, Accounting and Customer Service can all be tied together with powerful, centralized CRM software made to retain customer loyalty, increase revenue, deliver consistent and efficient customer service, and finally, evaluate which customers to focus on. CRM is composed of four types of CRM, which are strategic, operational, analytical, and collaborative CRM. BACKGROUND OF WAL-MART Wal-Mart is a retail and discount store organization which originated in the United States, in the early year of 1950. The purpose of Wal-Mart is to save people money to help them live better.
Wal-Mart enhances the purchasing power of consumers by offering the best possible prices on the products which our consumers need. The concept of Wal-Mart stores grew extremely popular in the United States. Sam Walton was convinced that the American consumers wanted something more than retail shops. He opened his own discount and retail shop in Roger, Arkansas. Walton had gained a lot of experiences related to discount shops after travelled across the United States. In1962, he started the Wal-Mart by opening first store.
In the next five years, Walton was succeeding to open 24 more stores in Arkansas due to his hard work. The 24 stores played a highly instrumental role in helping Wal-Mart achieve landmark turnover of RM12. 6 million. In 1968, Wal-Mart hired its first commercial pilot for speedy logistics. Wal-Mart started a huge expansion by opening a gigantic and a home office in Bentonville, Arkansas. In 1977, Wal-Mart introduced a branch for pharmaceutical with the name of Wal-Mart pharmacy. Wal-Mart became a giant in American retail industry with turnover of more than 1. 48 billion dollars in sales and 276 stores which managed by 21,000 staffs. In year between 1980 and 1990, beginning of Wal-Mart’s journey was trended to global retail phenomenon. As the company grew in size and also in term of monetary earnings, the operational area of Wal-Mart also kept on increasing. In 1983, the first Sam’s club was opened by Wal-Mart. The year 1983 was very eventful year for Wal-Mart due to the fact, that it was ranked first among the retail shop chains by Forbes Magazine. Besides, Wal-Mart’s supercenters were developed in 1988 to meet the growing demand for convenient.
It purposed to save consumer’s time and money by combining a full grocery and our general merchandise under one roof. There are 2772 supercenters nationwide and most are open 24hours. Supercenters average 185,000square feet and employ about 350 or more associates. Walton’s idea of retail shops, discount stores and supercenter has changed the world of shoppers and consumers. For the 21st century, Wal-Mart becomes most successful retailer in the world. It employs more than 2. 1 million associates and direct employees.
The stores of Wal-Mart serve more than 176 million consumers worldwide annually. Sam Walton and Wal-Mart organization have been successful in setting an example about maintaining value and managing the never-ending growth and success. WHY IMPLEMENT THE CUSTOMER RELATIONSHIP MANAGEMENT (CRM) Basically, every company has customers, and every company should maintain some basic information about those customers such as names, addresses, purchases, contracts, invoices, etc. Therefore every company should have at least some basic “CRM Technology” to track and serve their customers.
Even small businesses use Outlook, Quicken or other applications for this purpose. If use Microsoft Outlook for daily communications, calendaring, tasks and appointments and need a way to track sales leads and opportunities, to share data across sales representatives, to improve the understanding of sales process, to communicate with a broad groups of people on a one to one basis, to improve business process in the most important area such as sales, and need a reporting system that beats multiple excel spreadsheets, then need a complete CRM solution.
Why? Because CRM software can increase profitability for business by reducing current operating costs, usually in the call center or distribution system, and by increasing customer value through smarter marketing using customer data to increase customer profitability. Can do it without a CRM?
Probably, but not as efficiently because only a CRM is built to take care of Customer personal needs “centrally”, meaning that by using a single software, all the employees of the same company can access an organised database via Internet, where sales, customer service and management have access to the same customer data using tools such as “Sales Force Automation” (provides Lead Management, Opportunity Management, Account & Contact Management, Reports & Dashboards specifically useful for your organization’s sales team), “Customer Support ; Services” (provides Ticket Management, Knowledge Base, E-mail Notifications specifically useful for your organization’s customer support team. ), “Marketing Automation” (provides Lead Management, Mailing Lists, E-mail/Mail Merge templates, Product Management, specifically useful for your organization’s marketing team. ), “Inventory Management” (provides Products, Price Books, Vendors, Quotes, Purchase Orders, Sales Orders, and Invoices specifically useful for integrating organization’s sales, inventory, and accounting processes and enhance the sales effectiveness. , providing a complete integration between pre-sales, post-sales, procurement, fulfillment, and other business processes within organization. In other words, good CRM software will help build customer relationships by setting mutually satisfying goals between organization and customers, establishing and maintaining customer rapport and producing positive feelings in organization and for the customers. CRM helps businesses to gain an insight into the behaviour of their customers and modify their business operations to ensure that customers are served in the best possible way. In essence, CRM helps a business to recognise the value of its customers and to capitalise on improved customer relations. The better understand of customers, the more responsive can be to customers’ needs.
Besides that, CRM can be achieved by finding out about customers’ purchasing habits, opinions and preferences; profiling individuals and groups to market more effectively and increase sales; and changing the way operate to improve customer service and marketing. Benefiting from CRM is not just a question of buying the right software but also adapt business to the needs of customers. Wal-Mart – Customer Relations Wal-Mart is not a fling of sorts that will abruptly end, but it is a relationship built on commitment and trust that seems to get stronger and stronger over time. In order to better understand the customer franchise that Wal-Mart has nurtured through the 1980s as it grew by about 1,000 stores and dozens of new markets, thus, reflect the tremendous penetration and powerful position of Wal-Mart in the retailing industry.
Wal-Mart’s continuous growth as a general merchant, at a time when such retailers have declined, is exemplified in the fact that its customers have steadily increased the amount of money they spend in the store. The retailer has been able to satisfy the general merchandise needs of consumers. HOW TO IMPLEMENT CUSTOMER RELATIONSHIP MANAGEMENT (CRM) The implementation of a CRM solution is best treated as a six-stage process, moving from collecting information about customers and processing it to using that information to improve marketing and the customer experience. Collecting information is the priority should be to capture the information need to identify customers and categorise their behaviour.
Those businesses with a website and online customer service have an advantage as customers can enter and maintain their own details when they buy. Storing information is the most effective way to store and manage customer information is in a relational database which a centralised customer database that will allow to run all systems from the same source, ensuring that everyone uses up-to-date information. Accessing information is with information collected and stored centrally, the next stage is to make this information available to staff in the most useful format. Analysing customer behaviour is using data mining tools in spreadsheet programs, which analyse data to identify patterns or relationships, begin to profile customers and develop sales strategies.
Marketing more effectively is many businesses find that a small percentage of their customers generate a high percentage of their profits. Use CRM to gain a better understanding of customers’ needs, desires and self-perception, reward and target most valuable customers. Enhancing the customer experience is just as a small group of customers are the most profitable, a small number of complaining customers often take up a disproportionate amount of staff time. If their problems can be identified and resolved quickly, staff will have more time for other customers. Largest Retail Data Warehouse Wal-Mart is leads as the largest retail data warehouse in the world. It gave no details as to the size or specifics.
However, this massive data warehouse is not solely a customer CRM system, but also serves as the base for Wal-Marts Retail Link decision-support system between Wal-Mart and its suppliers. Retail Link allows suppliers to access large amounts of online, real-time, item-level data to help those suppliers improve operations. Buying VUDU To Build an E-Commerce Platform Wal-Mart is moving to build direct relationships with customers by buying streaming-video service VUDU. With VUDU embedded in consumer electronics, Wal-Mart has a great opportunity to bring the Internet to the consumer and provide direct services such as product sales. Wal-Mart is gaining an advantage over Netflix, Apple and Blockbuster.
Wal-Mart has agreed to buy VUDU, a three-year-old company that embeds its streaming technology into high-definition TVs and Blu-Ray DVD players. Wal-Mart and VUDU began briefing movie studios and TV makers. Control the User Experience Why is Wal-Mart investing in a company that provides an embedded technology into brand-name electronics? This is all about trying to control the user experience and give Wal-Mart more direct access to the customer. The goal would be to integrate these services into next-generation TVs and Blu-ray/DVD players and try and integrate them into users’ overall digital experience to make it easy for them to gain access to movies over the Internet on demand.
With Wal-Mart in the business of streaming content, sales of Internet-connected devices are expected to improve. E-commerce on the TV could be extended beyond entertainment to infomercials and product sales. Leveraging Relationships Ultimately, the retailer wants to use this as a way to provide more direct services to their customers and leverage the relationship they develop from these services to provide consumers other Internet-related applications and services over time. EXPERIENCES OF WAL-MART WITH CUSTOMER RELATIONSHIP MANAGEMENT (CRM) IMPLEMENTATION Customer experience is the cognitive and affective outcome of the customer’s exposure to, or interaction with a company’s people, process, technologies, products, services, and other outputs.
It also defined as the totality of experience customers have with the business, across all the channels and touch points. Wal-Mart is a company that has implement CRM programme. Wal-Mart has implemented a remodelling project that giving local shoppers a glimpse of the company’s next generation of store design and customer experience. Improvements are including new layout, wider aisles, low-profile shelving, bright interior paint scheme, enhanced lighting and easy-to-read signage. The purpose of making these improvements is to make the shopping experience more convenient for customers than before. Furthermore, Wal-Mart has come out a new design to improve customer experience.
It features a more widely shopping environment that contains no product displays and also aligned the departments that customers shop most frequently, makes it become quicker for customer to purchase everyday items. This new layout is easier to navigate so it will save the customers’ precious time as they shop for the necessities. Wal-Mart has combined the Site-to-Store pick up location and photo lab into a single area. Customers now have ready to access these services as well as associate who can provide aid when they need. Other than that, Wal-Mart also brings their customers an expanded electronics department that featuring a wide selection of the latest consumer electronics and home entertainment.
The new design includes a more hands-on experience for customers with interactive displays for hi-definition Blu-ray, video gaming and portable electronics. Besides that, a bright interior paint scheme and enhanced lighting also create a more inviting shopping experience and helps to define the store’s merchandise areas. Low-profile shelving creates an improved sightline and directional signage that helps customers search for the products they need. It can improve the customer experience as the company creates new design that can increase customer satisfaction. The customer experience is positive when the customers feel that the interaction happened is better than they expected.
It is important for a company to have positive customer experience because it will attract others in the market to purchase from the company and also easier for them to get support or engage. Besides, a positive customer experience will be able to ensure the high customer retention rate and low customer churned rate. The company has using the mystery shopping methods to understand the customer experience, which is interactive experience that enables paid shoppers to test the new technology. Shoppers need to report on their customer experience with the company sponsoring the research. It is needed for a company to carry out methods to understand the customer experience in order to improve customer experience.
For information, a new department called Celebration Station has been added and will feature party suppliers, greeting cards, balloon, cake suppliers and gift wrap. It is value added to improve customer experience of Wal-Mart. The customer experience concept is including touch points, moments of truth, and engagement which are related to the customer experience management. The touch points are found wherever customers come into virtual or actual contact with, or touch the company brand and the company’s product, services, communications, places, people, processes or technologies. Touch points for Wal-Mart includes email customer service, service centers, websites, call centers, contact form, direct mail and so on.
Wal-Mart is a company that committed to provide the customer service and a pleasant shopping experience. For example, the email customer service is about the store and corporate feedback. The company can know the customers’ enquiries, comments, suggestions and also complaint through this way. It will improve the customer experience when all the customers’ enquiries, suggestions and complaints have been satisfied and solved. The moment of truth is any occasion the customers interact with, or is exposed to, any organizational output which leads to the formation of an impression of the organization. It is the moments of truth during customer interactions at touch points.
Customer will form evaluation judgements, positive or negative about their experience. They generally can expect what will happen during the moments of truth, the dissatisfaction will result if the expectations are not met, whereas the satisfaction will be increased if the expectations are met. The engagement concept is the customer’s emotional and rational response to a customer experience. Companies that design customer experience want to evoke strong and positive engagement. The effective touch points individually or sequenced will move the customers closer to organization because of the high satisfaction, thus it will increase the engagement of the customer and also the customer experience. Customer Loyalty
Wal-Mart is a great example of a company that uses a blend of high-tech solutions and high-touch employees-like flesh and blood greeters-to increase customer loyalty. Wal-Mart lets technology work behind the scenes. Its CRM data warehouse is one of the largest in the world, tracking exactly what the customer purchases. As a result, Wal-Mart stocks more of the most popular merchandise and clusters items that people tend to buy at the same time. But Wal-Mart does not use technology to build profiles of individual customers by gathering addresses and phone numbers. Instead, Wal-Mart leaves that job to its local employees, who know their regular customers and understand their needs. Chose IBM’s Most Advanced Servers and Storage
Wal-Mart, the world’s largest retailer, has selected IBM Enterprise Storage Servers and IBM eServer z900 mainframes as the backbone of Wal-Mart’s worldwide data center infrastructure that serves more than 4,000 Wal-Mart stores, Supercenters and SAM’s Club facilities and millions of customers worldwide. Wal-Mart is using the new Enterprise Storage Servers (code named “Shark”) and the eServer z900 to create an e-business infrastructure that will more efficiently and quickly handle the data processing, reconciliation, debit and credit transactions, as well as the product replenishment for all of its retail outlets. This new IBM technology allows having a faster processing time, greater availability of systems and better systems operation without interruption. The IBM Shark and eServer z900 have given a significant improvement in processing time, in some cases allowing cutting processing time for some jobs by more than half.
This ability to save processing time allows Wal-Mart a faster look at trends in inventory and sales, allowing the retailer an even sharper focus on customer service, its low-price philosophy and international expansion and growth. Wal-Mart’s unwavering focuses on customer service and business efficiency is near legendary in retailing, and they are widely known as visionary leaders in leveraging information technology to achieve those goals. Wal-Mart chose IBM’s Shark and eServer z900 servers after rigorous benchmarking that demonstrated their reliability, power and capability. As companies transform themselves from businesses to e-businesses, their number one priority is building an IT infrastructure that is powerful enough to do the job now, and flexible enough to grow. The IBM “Shark” Enterprise Storage Server
The Enterprise Storage Server is the high-performance disk storage solution from IBM, which is recognized for its leadership in storage systems, software, services and patented technology. Built on the foundation of IBM’s Seascape architecture, the Enterprise Storage Server works with a variety of hardware and software technologies, such as Windows NT, UNIX, Novell NetWare, the entire IBM eServer family and with a variety of interfaces, including Fibre Channel, Ultra SCSI and ESCON. IBM eServer IBM is the world’s largest server company, offering a full line of data transaction, Web application and appliance servers that embrace industry standards.
Powered by breakthroughs such as microprocessors with copper wiring and Silicon-on-Insulator technology, IBM servers have captured industry leading benchmarks that measure transactions, web serving capabilities and performance in software applications. The IBM eServer line is an integral part of customized, flexible and scalable Internet solutions for companies of all sizes. IBM supports Linux on its entire portfolio of e-business servers. CONCLUSION Customer Relationship Management (CRM) system is very important for a company for implement business. CRM system is one of the newest innovations in customer service today. It helps management and customer service staffs cope with customer concerns and issues. CRM system involves gathering a lot of data about the customer. The data is used to facilitate customer services.
Besides that, CRM system facilitates cross-selling and up-selling. And thus, it helps company to understand of customer and anticipate their purchases. Hence, CRM can enhance customer satisfaction and lead to successful of business. Furthermore, CRM system helps management in making decision for the future course of the company. CRM system is also important to the top management because it provides crucial data like customer satisfaction and efficiency of service by staffs. CRM system also help for the top management in deciding the company future course of action, whether choose for using an on-premise CRM system or a hosted system via internet.
Other than that, CRM system enable the company to release advertisements or plan marketing campaigns more in tune with target market. Hence, it leads to more responses to the advertisement and more effective marketing campaign. CRM system helps the organization in identifying potential customers. The business can easily come out with a strategy to determine the kinds of people who should targeted by keeping a track of the profiles of their existing clientele. Moreover, CRM system defines as a good way to organize company business. CRM system embraces all aspect of relationship between the customer and supplier. Company implemented CRM can maximize the efficiency of all customer related activities, ultimately increasing revenues.
Main benefit of CRM system is it enables company to increase the efficiency of all related activities such as grow their revenues without expanding their resource spending. Marketing campaigns can be co-ordinated more effectively by ensuring that promotions do not target customers who have already purchased that particular product. It also ensures higher customer retention by introducing loyalty programs. A business would never like to see a product to a customer who has just bought it recently. CRM system is important in maintaining the intangible asset which is good reputation. Company with completely updated CRM will lead to the business successful and maximize the customer satisfaction. And thus, it can earn and enhance the reputation of company. CRM system also helps the organization to asily adjust the level of service to reflect the customer’s importance and status. Better customer services through improved responsiveness and understanding help in building customer loyalty and decrease customer agitation. It also assists company in getting continuous feedbacks from customer on the product they have bought. It is essential of CRM system for Wal-Mart to gain the understanding of customers. CRM system can control the growth of Wal-Mart budgets and demonstrate the value of achieving. Other than that, CRM system give Wal-Mart a lot of strategic advantages such as the ability to personalize relationship with customers regardless of which employees is service them.
Using CRM, Wal-Mart can maintain on customer profiles, thereby treating each client as an individual and not as a group. So, every employee can be better informed about each customer’s specific needs and transaction profile. Hence, Wal-Mart should focus on CRM in order to ensure they understand, anticipate and meet the needs of their core customers for anytime. By giving each customer the kind of attention via customer relationship management (CRM) system can move the customer up the loyalty ladder which is from transaction based marketing to relationship based marketing, thus, customers will keep coming back for more services. Wal-Mart will keep attaining the profitability goal in future.