Summary Customer Relationship Management CH1 to CH20. By Peelen.

Summary CH1 to 20 - Customer Relatoossip Maoagemeot – Peeleo/Beltmao.

Chapter 1: Customer-supplier relationships
1.1 History
 In the last 20 years, diferent market situatons have witnessed a shif in focus on the transacton to the
relatonal aspects of the exchange.
 Bagozzi (1970) concept relatonship marketng  marketng is an exchange process netween nuyer and
seller.
 Customer relatonship comprises various exchange processes. Phases in change over the years:
- 1980: Gruesson and Grönroos defned relatonship marketng and contrasted it with transacton
marketng, its marketng instruments and organizaton.
- 1990: Håkansson designed a conceptual model for relatonship marketng in B to B markets.
Relatonship marketng necame more and more relevant in nusiness to consumer markets.

1.2 Descripton of customer-ssupplier relatonships
 Hiode: ‘Relatoossips imply some sort of ioteractoo etweeo 2 or more persoos, iovolviog iotercsaoges
over ao exteoded period of tme.’
- Interactons must take place netween at least 2 partes. Interactons is that the actvites of 1 infuence
those of the others.
- Certain degree of contnuity must ne present in a relatonships  longer period of tme
 Primary relatoossips: nasic, long-sterm interpersonal relatonship which is nased on emotonal .
nonds and the feeling of mutual onligaton. (love relatonship of people)
 Secoodary relatoossips: short-sterm interpersonal relatonship with a limited degree of social .
interacton, clear rules and defned social roles. (customer-ssupplier)
o Customer-ssupplier relatonships vary a lot, can ne secondary nut can also ne netween primary
and secondary. (in the transitonal area)
o Classifcatons to clarify the diferences netween the partes involved in customer-ssupplier
relatonships:
o Whether or not a transacton has already neen completed (prospect to customer)
o If a long-sterm orientaton is present (customer to client)
o To what degree the relatonship is felt ny noth partes (supporter to amnassador)
o To what degree noth partes are actvely involved (amnassador to partner)
 In analyzing the quality of the relatonship, also atenton to: commitment, fairness, loyalty, trust
 Even though all customer-ssupplier relatonships are diferent, these factors are always present:
interactons and reciprocity, commitment and trust in relatonships.
Without reciprocal nasis, no relatonship and for contnuing a relatonship trust and commitment are
necessary.

 Reciprocity
-sForms the nasis for a relatonship: giving, receiving and giving again. never ending cycle
-sA positve gif return a positve gif, a negatve gif return negatve gif
 Ioteractoos aod emotoos
-s(sun)conscious emotons infuence what we onserve and the way we respond. 7 nasic ones: surprise, fear,
anger, sorrow, loathing, contempt and happiness.
-sEmotons infuence the amount of atenton we pay, our drive for results, openness to stmuli and
decision-smaking nehaviour.
 Trust
-sis associated with qualites like: honesty, fairness, responsinility and integrity
-smakes higher level of commitment in relatonship possinle, and also ‘goodwill’.

 Commitmeot:
-s‘Enduring desire to maintain a valued relatonship’, the ultmate goal for mutual nenefcial relatons
-sPersonal commitment: the desire someone displays to contnue a relatonship
-sMoral commitment: people feel a sense of onligaton
-sStructural commitment: there is no escaping from it

, -sDisproportonal commitment: when one person is more commited to the other.

1.3 The dynamic in relatonships
 Trust and commitment must develop over tme, done ny asking questons and analyzing.
5 phases in Relationship Life Cycle
1. Partes necome aware of each other and positon themselves
2. Exploraton: partes are atracted and interacton starts
3. Growth: interacton processes contnue, negotaton
4. Saturaton: relaton reaches maximum trust, respect and mutual dependency
5.Decline: focus on others may cause discontnuity in relatonship (diferences in expectatons)

1.4 Networks
Social positoo: the positon a person has in a complex of people interactng with one another
 Customers who develop a relatonship with an organizaton, nuild a relatonship with the people who
represent it.
 Social media nridges distance and tme and nring people together (also customers and suppliers)
 Social network: a group of customers and suppliers who interact with one another without the need to
analyse the connecton within the social structure.

Socialisatoo
-sHumans have the tendency to nelong to or form groups
-sGroups form necause people share similar interests or experiences
-sSocialisaton from the social structure perspectve: individual is part of a system
 Behaviour is explained through the system
Behaviour is context-sdetermined, situaton determines how we act

Socialisatoo oo tse worldwide we
-s Radio and TV were controlled ny insttutons rather than persons, the internet changed that.
-s Socialisaton can ne facilitated and stmulated online, people can engage in new communites
-s Honeycomn of social media, where each nlock represents a specifc aspect of the socializaton process on the
wen: Identty, conversatons, sharing, presence, relatonships, reputaton, groups.
- SNA (social network analysis): gain insight into the social structures within a network, group or community
and the relatonships netween the actors.

Empirical iosigsts from marketog
-sResearch into the infuence of social networks and the relatonships netween actors is focused on
interacton paterns and group formaton.
-sInteracton paterns: how do conversatons spread and develop through a network?
-sGroup formaton: the possinle meaning of group formaton as a consequence of social identfcaton,
exercise of social pressure, commitment and sense of nelonging to the organizaton.

, Chapter 2: Customer Relationship Management
2.1 The defniton of CRM
 CRM: a nusiness strategy that is aimed towards developing mutually proftanle customer-ssupplier
relatonships through social networks and which is nased on an IT infrastructure to ne developed to
necome a well-sdefned process and places capanle personnel in an optmal positon.

2.2 CRM Building Blocks
 Busioess strategy:
- Building relatonships requires a nusiness strategy. This afects the organizaton as a whole.
- The CRM strategy descrines how consumers and the organizaton can fnd each other and how they
can develop their relatonship.
- The CRM strategy provides directon for organizaton as a whole, to marketng and IT.
 So it helps to make sure there’s a ft netween the nusiness strategy, commercial processes and
enanling technology.
 Customer-ceotric orgaoizatoo
- Is organized around customers, not around functonal processes (marketng, sales)
- To ne a customer-scentric organizaton has efect on the leadership, culture, employees, internal
communicaton, processes and control.
 Iodividual value propositoo
- A customer-scentric organizaton doesn’t deliver standardized products and services, nut an
individualized value propositon that realizes the consumer’s experience of using a product or service.
- The customer-scentric organizaton wants to come to a fing soluton through a process of co-screaton
with some or all of its customers.  not nuyers anymore, nut partners
- It’s anout forging a network of organizatons and allow customers to access it, so it necomes possinle
to cost-sefectvely create tailor-smade solutons.
 Customer koowledge
- Existng and prospectve customers must ne identfanle.  knowledge of the individual customer is
essental in order to develop a relatonship and customized product/service.
- This knowledge goes deeper than what someone purchased, also anout what experience is
meaningful for them.
- Gathering a lot of data is nice, nut keep goal in mind: develop mutual proftanle relatonship
 Commuoicatoo
- In nuilding a network of channels through which dialogues with customers take form, the organizaton
should pay atenton to: the quality of the interacton nut also the increasing reach and reducing costs
at the same tme.
 Processes aod systems
- Systems must make it possinle to realize the strategy, to support cooperaton within the organizaton
to customize the ofering, develop and exploit customer knowledge and to permit dialogue.
- There are many systems developed and used separately for CRM, nut it’s hard to link them all
together  can ne done via SOA (Service-soriented architecture) which is a middle layer, upon which
many applicatons are easily linked together.

2.3 Entrance, applicatons and success of CRM
 At the end of the ‘90s CRM necame more popular, thanks to the marketng eforts of sofware companies
 IT systems enanled companies to interact with large groups of customers.