Putting the 'Relationship' Back Into CRM Marketing Strategy Analysis & Solution

Marketing & Sales Case Study Analysis and Solution

At Fern Fort University, we use Harvard Business Review (HBR) marketing principles and framework to analyze Putting the 'Relationship' Back Into CRM case study. Putting the 'Relationship' Back Into CRM is a Harvard Business Review case study written by Susan Fournier, Jill Averyfor the students of Sales & Marketing. The case study also include other relevant topics and learning material on – Supply chain

Strategic Marketing Analysis of Putting the 'Relationship' Back Into CRM case study written by Susan Fournier, Jill Avery will comprise following sections –

Putting the 'Relationship' Back Into CRM Case Description
Marketing Definition
Market Potential Analysis of Putting the 'Relationship' Back Into CRM
Market Share Potential Analysis
Segmentation and Segment Attractiveness Analysis
Competition and Competitiveness Analysis of Putting the 'Relationship' Back Into CRM
Customer Value Analysis of Putting the 'Relationship' Back Into CRM case study

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Putting the 'Relationship' Back Into CRM Marketing Case Description

Sales & Marketing Case Study | Authors :: Susan Fournier, Jill Avery

Many managers think that the way to capture value through relationship marketing is to focus on the "good" customers and get rid of the "bad"ones. But there is a lot more to best practice relationship management than maximizing revenues on individual customers and minimizing costs to serve. The authors studied people who were in emerging, existing and terminated relationships with companies and identified three important ways in which the current practice of CRM fails. First, companies forget that their relationships are not just with consumers, but with people who live rich and complicated lives. Second, because relationships come in different shapes and sizes, companies need to be cognizant of the requirements of diverse types of relationships beyond the loyalty ideal. Finally, companies don't recognize that relationships are two-sided and that these relationships evolve with each interaction. These three failings, illustrated with examples, led to the identification of three principles: Get to know customers as people; think beyond loyalty; and take responsibility for relationships that are two-way. The authors provide guidelines for companies that want to improve the overall value of their customer relationships. They suggest that companies first catalog and analyze the types of customer relationships they have, then develop a portfolio of relationships, optimizing those they have and identifying which new ones to focus on. Companies then need to determine which metrics to use to track the health and performance of those relationships, adjusting as they go. For most companies, the transition to a relationship-based approach will require a significant shift in mindset and practice. Managers will need to expand the type of data collected by their CRM systems, customize CRM solutions to the specific types of relationships the company is managing and retrain customer-facing employees to be sensitive to the relational clues they receive and send. This is an MIT Sloan Management Review article.

Supply chain

Marketing Definition

According to American Marketing Association – Marketing is a set of activities that a firm undertakes for creating, communicating, delivering, & exchanging offerings that have value for customers, clients, partners, and society at large.

Kotler explains - Marketing is a process by which organizations can create value for its potential and current customers and build strong customer relationships in order to capture value in return.

Market Potential Analysis of Putting the 'Relationship' Back Into CRM

Market potential analysis comprises evaluating the overall market size of the related product that the firm is planning to launch. This will involve defining – Why the target market segment needs the product and how it will provide a solution to full its consumers’ needs. Market potential of Putting the 'Relationship' Back Into CRM products various on factors such as –

Maturity of the market. In mature markets the profitability is often stable but the market potential is less as most of the players have already taken market share based on the segment they are serving. New players have to go for market share strategies in marketing.
Technological competence of the existing players and culture of innovation and development in the industry.
Untapped market sizes and barriers to both enter the market and serving the customers. Often companies can easily see the unfulfilled needs in the markets but they are difficult to serve as there are costly barriers.
Define the core need that your product is serving and list out all the direct and indirect competitors in the market place. This will help not only in positioning of the product but also in defining or creating a segment better.
Uncovering the current and untapped market sizes and barriers to serving the larger market. Analyze the areas that you need to sort out while launching the products to wider market and what are the challenges the firm will face in market place.
Estimate the current stage in product life cycle and its implications for marketing decisions for the product.

Market Share Potential Analysis

Understanding the buyer behavior model for Putting the 'Relationship' Back Into CRMindustry.
Identifying the market share drivers relevant to Putting the 'Relationship' Back Into CRM market.
Segment Attractiveness Analysis – Our analysis will work out which are the most attractive segments and which are the one the firm should go ahead and target. We point out in great detail which segments will be most lucrative for the company to enter.
Understanding the different needs and relative value of your offering by segment.
Developing segment priorities and positioning the product based on the product need fit developed by the firm.

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Competition & Competitive Position Analysis

Uncovering customer-based competitive positions for key rivals and firm’s offering. This will not only help in assessing the strengths and weaknesses of the competitors but also help in defining and positioning of the product.
Developing a positioning and launching strategy. It will require not only distribution channel analysis but also promotion mix for the product.
Strategic Marketing Planning — the process of developing and maintaining a strategic fit between the organization’s objectives and capabilities and the ever evolving marketing opportunities for its products.

Putting the 'Relationship' Back Into CRM - Customer Value Analysis

Capturing customer value is essential to marketing efforts as it results in higher return in the form of both current & future sales, greater market share, and higher profits. By creating superior customer value, the organization can create highly satisfied customers who stay loyal and buy more. This, in turn, means greater long-run returns for the firm.

The crucial role of customer perceived value in acquiring and retaining profitable customers. Product differentiation is often based on building on a value niche that a firm believes that is very important to the customer. This niche contributes to perceived value. If the perceived value is high then customer stay loyal to the product if not then she can switch to the competitor’s product.
Graphically displaying value differences for deeper understanding and better internal communication. This helps is building a narrative that a customer can identify with. The better the insight more are the chances of connecting with the potential customers.
Identifying and selecting actionable value creation options. This can help in increasing the customer lifetime value. Customer lifetime value is the value of the entire stream of purchases that the customer would make over a lifetime of patronage.