CRM in B2C Market
In consumer market establishing a cordial relationship with the customer is an important consideration. An effective relationship building can be done only by delivering quality service to the customers. There are some important characteristics of the service which are as follows :
- Intangibility –it means that service cannot be touched it can only be felt.
- Simultaneity – which means that the service is produced and consumed simultaneously.
- Perishability- it means that the service cannot be stored.
- Heterogeneity – it means that the quality of the service varied each time it is delivered
- Assurance in delivery
- Reliability in performance
- Tangibles associated with the service
- responsiveness of the consumers
The cost of Losing the customers
- When a customer is lost it reduces the cash flows in the company for the future
- Gaining new customers and losing the existing customers require high cost of advertising and various other costs
- A firm is more efficient in serving old customers rather than new customers, since they are aware of the needs of the existing customers.
- Firms with long-term customers, in whom they have developed a higher level of loyalty, can charge more for their products and services.
- An existing customer can help in getting new customers through references.
Managing the defections of the customers
- There should be some technique to find out those customers who are leaving the firm or are likely to leave in the near future.
- After identifying which customers are more likely to leave then it becomes necessary to get them back and can stop the loss of revenue from the firm.
- Defections also help in getting a real view of the firm from outside which is not possible to judge from within the company
- Defections also serve as an early warning for the firm.
- The defections also would help the firm to make decision on which type of service quality investment would be profitable for the firm.
- A firm should not keep all its customers whether existing or the new customers in the firm at any of the cost
- The defecting of the customers also explain the reasons for which the customers are leaving the brand and also will help the firm to understand the mechanism for service delivery and also take some corrective actions to manage these defections.