An oft used term by everyone right from the Gyan Guru’s down to the new recruit…..to all the agencies. Some call it Customer Relationship Management; whilst some use it for Customer Retention Management, so on & forth.

Everyone has a different spin on it like
• 60-70% of our business comes from our CRM techniques.
• We apply CRM/we use CRM
• Our new CRM package/software shall take care of this.

However the facts are something else.
• Software is xls./access at most places being driven by the long suffering marketing executive.
• Even where it had been introduced, the ownership has been passed down.
• A lot of promotions run to ward competition helps to get business.
• Nobody really knows the cost of CRM
• And there are serious ownership issues.

There is always a time limit put:
• On redemption that ensures 80:20 rule is applied, where only 20% of the customers shall redeem.
• On purchase period to certify that you are loyal.

Every store, restaurant, airline, hotel, FMCG, vehicle companies etc. today collect data, promising some gift or the other, give it to the selected people & that’s the end of the promotion that has CRM/loyalty at the back!!

What about those who did not win anything but took time out to fill in your form & are still loyal to you.
When will people understand that in this new age “Loyalty has a price”

This daring quote on an employee’s board sums up today’s sentiments :- ” I work for money, if you want loyalty…hire a dog ”

For customers this is particularly true in this age of No or little differentiation by majority businesses, what they look first for is Rewards then Loyalty.

When will companies understand that Customers today are looking for Convenience; Consistency; Experience; Gratification/Rewards – Before they turn Loyal.

The loyalty card needs to factor in Instant Gratification, followed up by Consistent Product value as well as experience which would then turn customers loyal.

For Example Some years ago -A coffee place had started with a Gift voucher for Rs. 50/- when you bought anything from them. Good initiative but that Rs. 50/- off was on 2nd Purchase of Rs. 250/- Yes you can argue that it was 20% off, but the target audience consisting of college kids, Yuppies would at the most , whose average invoice was in the range of 60-100 every time.

There would have been nice pat for it not affecting its bottom line, but nobody was rewarded & they did not feel loyal. Yes till it was convenient they continued then shifted to another coffee place.

AGAINST this, if the same gift voucher had been broken into 5 each of Rs. 10/- that was off on anything, you would have had the person coming in 5 times feeling rewarded & being loyal for those 5 occasions at least. And every time he/she came in, offer a cookie coupon that gave out a cookie the next time around also. The volume itself would have ensured increase in bottom line.

Another coffee place started a card where you paid Rs. 50/- and then you would get 10% off, which was a good thing but discontinued it abruptly for reasons best known to them.

In India today practically everyone has or is jumping on the CRM bandwagon that is plain vanilla with 3 tier approach. With highly advanced technology at your beck & call for a reasonable price, why is it not made use of to differentiate? Instead of the blue, silver, gold why can the categorization not be made male/female – apparels, books, household, sports etc. based on their spends & specific offers be made to them which would make the customers feel wanted & loyal.

There are some who have argued that the market has to mature before this being attempted, but if you are not willing to experiment, the customers who have already matured will Kiss you good bye!

For those who would like to read about the basic steps of crm

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Written by AD
ex waiter, angadia, travel agent, dotcomer, dukaandaar, marketeer, people watcher. appreciates single malt, food, friends