Free Marketing Dissertations - Arguably, Crm Takes This A Step Further In Its Incorporation Of The Other
Arguably, CRM takes this a step further in its incorporation of the other business functions, invariably contributing to the provision of a value maximising service to the consumer via the management of customer relationships, and increasing the relative likeliness of creating loyalty and retention.
Table 1 below demonstrates the levels of interactivity provided by the varying approaches to customer management observed:
Individualising of Solution
Intensity of Customer Relationship
Customised Marketing
Product Construction
Product Configuration
Individual Marketing
Customer Profiling
Self Customisation
Database Marketing
Mass Customisation
Learning Relationship
Mass Marketing
Transaction
Standard Product
Repetitive Buy
Relationship Marketing
Partnership
Loyalty
Customer Integration
Table 1: Adapted from Link & Hildebrand (1997) cited in Muther (2002)
Relationship marketing has been successful in creating strong ties with consumers on a large scale. The technique has traditionally sought to apply its marketing communications to its customers depending on their relative needs. This involves customising marketing and product offerings to the various individual consumer groups to create a more personalised service, as well as to develop a relationship based on interactivity.
CRM, on the other hand, adheres more to the individual marketing attributes summarised above. Due in the main part to the technology to make such a system technically and economically feasible (Österle 2002 cited in Muther 2002), organisations are now able to further customise their marketing and product offerings, not just to groups but to individuals themselves. Hence, consumers need not be grouped together into lifecycles with others, as companies can adapt their services to meet individual requirements.
Using this system, large organisations are able to provide mass customisation of its services to its consumers; unfeasible in preceding years. Mass customisation could be seen as the ultimate form of customer service for large global companies who were previously not able to provide the sort of personalised service smaller or individual businesses could. The hotel chain Ritz Carlton, for instance, developed technology to provide individualised service via an electronic customer database which records previous guest requests so staff can better tailor their next stay. The company also uses a Service Quality Indicator (SQI) to monitor the key production and guest service processes up to the minute. Integration of databases and technology, in this respect, can lead to high quality personalised service on a mass scale.
CRM systems are able to provide the sort of strong customer relationships found within RM approaches, and also tailor products, services and communications.
