A01 chaf6542 06 se fm indd

Chapter 9  Customer relationship management

Summary

  1 

The objective of customer relationship management (CRM) is to increase cus‑

tomer loyalty in order to increase profitability. CRM is aimed at improving all 

aspects of the level of customer service.

  2 

CRM tactics can be based around the  acquisition–  retention–  extension model of 

the ideal relationship between company and customer.

  3 

In an e‑commerce context, acquisition refers to gaining new customers to a com‑

pany and converting existing customers to online services. To enable an online 

Questions

Based on the case study and your own research on 

competitors, summarise the strategic approaches 

which have helped Tesco.com achieve success 

online.

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Part 2  Strategy and applications

relationship it is important to profile customers to find out their needs and expec‑

tations and obtain an opt‑in email agreement to continue the dialogue.

  4 

Marketing communications techniques to achieve acquisition, retention and 

extension include traditional online  mass‑  media techniques and specialised 

online techniques such as search engine registration,  link‑  building, email market‑

ing and banner advertising.

  5 

Techniques for customer retention include the use of extranets, online communi‑

ties, online sales promotions and email marketing.

  6 

Customer extension involves better understanding of the customer through feed‑

back on new product development and encouraging customers to increase the 

depth of their relationship by offering complementary products for purchase or 

increasing purchase frequency.

  7 

Knowledge of online buyer behaviour, and in particular, the differing needs of 

the customer through the different stages of the buying decision can be used to 

improve CRM management.

  8 

Customer service quality is important in achieving loyalty and the SERVQUAL 

framework can be used to consider how to use the Internet to achieve this.

  9 

Technology solutions for CRM are aimed at providing interaction between 

employees and customers across multiple communications channels with all 

customer information stored in a single database to provide complete visibility of 

the customer by employees. Managers look to minimise the number of solutions 

partners they work with to achieve these goals.

10 

Specific technology application requirements for CRM are salesforce automation 

(contact management) and  call‑  centre applications which integrate workflow to 

manage queries and a knowledge base from which queries can be reviewed.

Exercises