Evaluation of CRM Contribution - Dissertation Example

Like for every other industry, CRM can prove to be an effective strategy for UK banks which will not only help them build and survive in tough competition and harsh economic scenarios but will also help them grow and enjoy customer life time value only if implemented carefully and properly. Evaluation of CRM contribution in order to gain customer retention in the UK banking industry – A case study of Barclays Bank Richmond branch 1 INTRODUCTION Approaching customers and selling company’s offerings is not a new concept; what is new is the change in focus.

Previously, companies tend to focus on selling their products and services to the customers irrespective of the fact that whether the solutions offered are required or not and honestly there was no need either because there were quite a few alternatives available which makes the sales of any product easier. However, with the change in time where markets became tight and competition became tough there comes the need to remodel selling techniques. Now the modern marketing concept, as stated by Jobber & Fahy (2009, p. 3), suggests “achievement of corporate goals through meeting and exceeding customer needs better than the competition”.

Another necessity which aroused with time is the need to retain existing customers than to attract new ones. Research shows that attracting new customers is more expensive than retaining old ones (Jobber & Fahy 2009) and this changed the focus even further. Among several strategies adopted by companies, Customer Relationship Management (CRM) has become a focal point. According to Nili & Keramati (2011, p. 527) CRM “is a business philosophy that provides the organization a vision to deal with customers better”.

It helps enhance customer’s experience by offering them real business benefits which not only enhance customer loyalty but also promise increased revenues and profitability for the businesses (Russ 2006). CRM has become an important strategy for all industries and financial markets are no exception. According to Russ (2006) “Retail banks are facing greater challenges than ever before in executing their customer management strategies. Intensifying competition, proliferating customer contact channels, escalating attacks on customer information, rising customer expectations and capitalizing on new market opportunities are at the top of every bank executive’s agenda.

” Given the importance of Customer Relationship Management in financial markets, this research aims to critically evaluate the contribution of CRM towards customer retention in the UK Banking industry. Barclays Bank Richmond branch has been selected as a case to fulfill the purpose of this study. 1.1 Background and Context Customer satisfaction is the main aim of every business as the businessmen know that it is easy to do business with a satisfied customer because it requires fewer resources and less time.

The success of a business relies mainly on one factor “customer retention” and to retain customers it is very important to make sure they are satisfied. Customer retention can increase profits and productivity and forms long term relationships which are beneficial to both parties. Customer Relationship Management is found to be one of the key factors in retaining customers which further ensures company maintains a strong and loyal customer base. With the help of CRM, the customer service personnel can create, allocate and manage any request for service made by the