In this research, the researchers have highlighted the topic ‘Developing a Social Customer Relationship Management (SCRM) Strategy within Organisations’ the two variables of the research are social media and customer relationship management (CRM). For stabilising the relationship between the consumers and the business, social media plays an essential role in providing the details of the organisation right to consumers. The aim of this research is to understand the challenges organisations face in current times to adapt with a new term known as social customer relationship (Ionescu 2014).
Unfortunately, certain organisations are still not aware with this term and do not understand the social media value of CRM. The paper will focus specifically
…show more content…
However, many organisations that are in competition with Aldi try to give as much customer value as possible. In order for Aldi’s strategies to be successful they necessitate an innovative and developed strategy to progress in the future. The problems, which will be investigated, is to develop a Social Customer Relationship Management strategy for Aldi with the intention of solving these problems the following questions will be formulated:
==> What is the Social Customer Relationship Management process? The research gathered formulates what SCRM is and how the strategy works to play an effective role for businesses and their consumers. Also to give a brief understanding of the development of CRM in SCRM.
==> What is porters 5 forces and how they implement on SCRM process? Identifying the main problem through using Porters five-force model and sticking to buyer’s power to identify competitors as for Aldi the buyer’s power is quiet high. In order to give organisations recognition to the market and their main consumers, organisations need to get involved with SCRM, to provide the ultimate value for customers
As strategy consultants of McCormick & Associates, we use Porters Five Forces Model as a framework when making a qualitative evaluation of a firm's strategic position (Appendix 1.2). These five forces determine the competitive intensity and therefore attractiveness of a market. These forces affect the ability of a company to serve its customers and make a profit. A change in any of the forces normally requires a company to re-assess the market place.
Porter’s Five Forces is defined as threats of new entrants, bargaining power of suppliers, power of buyers, the threat of substitutes and rivalry among existing competitors. New entrants into the industry aim to gain market share from rivals, so the intensity of competition may require to make changes on current strategy of marketing to maintain existing market share. The bargaining power of suppliers is one of the threats on the industry where price changes or product quality by suppliers can impact the profitability. Therefore, it is important for the companies to keep alternate suppliers or a contract to ensure prices, quality and quantity of the product so to avoid the company's supply from falling behind. The power of buyers can force the companies to lower the prices and offer different type products and service. Buyer can threaten the company with the competitors which may cause a negative impact on the bottom line to the companies. Thus, it is important to create a loyalty market share to avoid this threat. The threat of substitutes increases when another industry offers a similar product or services to customers within the same industry with a lower price. In this case, the industry profitability sinks since the product is available at a better price. This threat forces most competitors to price match or better performance. Rivalry among existing competitors ...
Porter’s competitive forces model includes five forces that need to be analysed. These forces include the intensity of rivalry from traditional competitors, threat of new market entrants, threat of substitute products and services, bargaining power of customers and bargaining power of suppliers (Laudon & Laudon, 2007). See diagram below;
The Porter five forces model (see Appendix 1) as an external analysis tool was established by Michael E. Porter and firstly announced in his book “Competitive Strategy: Techniques for Analyzing Industries and Competitors” in 1980 . The main idea of the Porter five forces concept is that the attractiveness of a market depends on the characteristic of the five competitive forces that have an impact on a company (see Appendix 2).
SCRM is a strategic business process whose vital objective is to build long term relationship with its customer/traveller, to ensure customer/travellers loyalty along with enhancing the brand image and its value and increase customer satisfaction. SCRM can also be considered as organisation’s philosophy, to enthusiastically
Customer relationship management systems are part of enterprise applications. These systems are used to help manage relationships with customers, Information is provided to coordinate all of the business processes that deal with customers in sales, marketing, and service to optimize revenue, customer satisfaction, and customer retention (Laudon & Laudon, 2012).In today’s world, customer management relationship systems have given companies a large list of ways to interact with customers. Even though those ways are applied occasionally, companies still find even newer ways to provide customers an enjoyable experience for their products and services. Today, the customer relationship management industry is mainly focused on components, such as crowdsourcing, customers using mobile apps of companies and interaction from the social media teams of companies. Needless to say, Starbucks, coffeehouse chain, have pioneered in this system. Starbucks started out as a café in Seattle, Washington in USA at1971. One day, in 1981, a man named Howard Schultz entered in the café for the first time and fell into homelike environment of the café. He adored the place so much that, in 1987, he and a group investors acquired the café. From there on out, as of June 28, 2015, they have built more than 24000 stores in 70 countries
In 2011, Swati Singh and Manju Lamba in their paper ‘Maintaining CRM in Apparel Retailing through Touch points’ highlighted on Customer Relationship Management which is the most talked about business mantra these days. With the advent of CRM in late 1990s, marketers are of the opinion that appropriate vigil and analysis of customer data might bring wonders for the organization. Indian apparel retail sector is booming, leading to intense competition. The war is to attract new customers but most importantly to retain the old ones. The companies are continuously adopting the process of generating custom CRM initiatives to increase their customer base. The study is focussed at establishing the importance of genuine customer touch points in CRM. This empirical study establishes the important touch points from customer’s point of view.
Payne and Frow (2005 :168) defines customer relationship management(CRM) as strategic approach concerned with creating improved shareholder value through the development of appropriate relationships with key customers and customer segments. According to Agrawal (2003 :109) CRM can be defined as a concept that keeps tracking customers, once attracted, retains them in the business and makes profit from their growth.
One source of technology that Marketing companies use is called Customer Relationship Management Systems. For many corporate senior executives Customer Relationship Management has introduced itself in their boardroom meetings with mixed reviews-initially appearing to be a great opportunity to increase efficiency, revenues, and profitability, as well as providing a process for getting to know the customer better. Software companies and consultants have communicated with both large and small companies about using the CRM strategy. They have also made it clear that if they didn't jump on the bandwagon they would loose out a great deal to their competitors who are more open to new corporate practices. CRM is a great asset to use with business-to-business and business-to-consumer relationships. However while the systems are being purchased by companies they are wither not using it to the best of it's ability or the companies are not properly implementing the CRM system, which in turn is a waste of the company invested time, effort, and most important money.
Computer Economics, a research and consulting firm, surveyed 209 IT organization worldwide regarding their IT investment plans. The leading trends “were identified as low risk/high reward based on their cost predictability and their positive return on investment for organizations within two years’ time.” CRM tops the list for 2014 (Mackie, 2014)
Customer relationship management is a cross-functional process to achieve a continuing dialogue with customers, across all their contact and access point, with personalized treatment of the most valuable customers and to ensure customer retention and the effectiveness of marketing initiatives. It is also provide the chance for customers to interact with the brand.
The writer finds social media is important in her current organization, Modern Business Concepts, Incorporated (MBC). With small business organizations such as hers, social media is important in spreading information on who the company is and what they do. Also as a business-to-business sales and marketing company, spreading the word is important in gaining customers and potential employees. Ucok (2014) uses research and experiments to prove how social media is essential to marketing. These platforms were essential in Ucok’s research, resulting in higher response with marketing campaigns proving “the importance of social media in marketing strategy and communication” (Ucock, 2014, p. 95).
In 2016, the value of Internet retailing improved to 84% (Euromonitor International, 2016). Thus, online marketing became vital to businesses to promote their products. In respond to that, market players continuously promote their products through social media such as Facebook and Instagram. Businesses improve their customer relationship management as these platforms provide a swift and convenient 2-way interaction (Euromonitor International,
Customer relationship management has become the marketing buzzword of the past two decades, with business-to-business firms jumping in, many without really being certain of what they hope to achieve from it, and oftentimes being disappointed with the results. Gummesson (2004) describes CRM as "the values and strategies of relationship marketing with particular emphasis on customer relationships- turned into a practical application. " CRM has become a necessity to successfully and profitability manage customers and a firm’s relationship with them, with the market reaching a value of approximately $11.5 billion in 2002. Xu et al. 2002). The 'Secondary' of the 'Secondary' of the 'Secondary' of the 'Secondary' of the 'Second
Customer relationship management or CRM for short is a model for managing a company’s interactions with current and future customers. When CRM is utilized correctly it will increase profitability and customer loyalty, which are both very important to an organization. It involves using technology to organize, automate, and synchronize sales, marketing, customer service, and technical support. Customer relationship management is very important in many ways to help a company become and stay successful. CRM can help businesses gain a competitive edge through communication, marketing, gathering customer information, social media and mobile technology. Customer relationship management is a continually evolving domain and now social media technologies have revolutionized the way businesses and consumers interact. (Choudhury & Harrigan, 2014) There are many benefits that come with implementing customer relationship management.