CRM of Caffe Nero - Case Study Example

CRM Report: Caffè Nero

Introduction

Customer Relations Management is very instrumental to business. The main reasons companies exist is to serve their customers. Customers are the main source of revenue in any given organization. As such, the worst thing that can happen to an organization is the loss of a customer. Every organization must focus mainly on keeping customers happy, retaining them and attracting new customers. However, Customer Relations Management also extends to the organization’s pockets. Heavy investment in customer services must be made by any organization seeking to improve its relations with customers. Besides offering a product, looking for feedback from customers is also instrumental as it makes the organization establish some of the sound policies to improve the revenues and competitive position of a company. Additionally, good customer relations management is vital for the health of an organization. According to Drucker (1954), in the very competitive environment that businesses in the contemporary world thrive, competition affects the economic position of a company. When the customer relations of a company are good, repeat business is assured. As such, CRM is vital in that it builds customer loyalty. It also allows an organization to improve its brand and its products as well. Customer feedback is instrumental in improving the services as well as the products. With a good CRM system in place, a company’s position in the industry is almost secured. Competitors are more likely to beat other firms purely due to their customer service approach.

Maintaining Customer Relationships

Caffè Nero is an excellent organization. One of the key traits about the business that makes it unique is its interior design. Most people who have been to their shops will tell you that it feels like home. The good Italian finish is a key aspect that makes the coffee shop highly admired. Additionally, the staffs are also very welcoming. Most comments made about Caffè Nero indicate that the staffs are always very polite and highly courteous. They also welcome the customers with smiles which thus makes them very popular among the repeat customer. These are some of the strengths of the CRM of the organization. However, this does not mean that the customer service of the company is extremely outstanding and completely excellent.

The company has some few weaknesses when it comes to its CRM. First, the main problem that has been noted is the fact that the online platform for booking a reservation is extremely poor. The company has an inaccurate booking system which at times might indicate that the cafe is full, whereas in reality it might not be full. Therefore, this has had a bad image for the company among its customers (Khanlari, 2015, p.25). In addition, there are a few other modifications that must be made to make sure that the company is performing at peak conditions. The organization also has extremely large queues that keep customers waiting for a very long time, and this is an issue that needs to be sorted out as quickly as possible. As such, to improve customer relationships and attract more customers, these issues must be solved as soon as possible.

Several recommendations are feasible for Caffè Nero’s problems. Primarily, integrating superior technology will be instrumental in better customer relations management. Using technological applications and software can improve the performance of the organization. Creating an IT department that will manage customer relations solely is the best approach that should be adopted at first. Having good smartphone applications that allow customers to place orders before coming to the cafe can help reduce the booking inconsistencies and also to reduce the long line of queues. By reducing the time the customers have to wait to be served, the organization might have more customers being attracted to the cafes.

E-CRM is a new form of Customer Relations Management that uses the internet to make the recommendations much easier. According to Buttle and Maklan (2015), the coming of the internet has made it possible for businesses to move most of their organizational processes to go online. Evidently, using the internet can easily make it possible for organizations to develop better solutions and implement them more easily. Likewise, the organization needs to have an online customer relations management system, either for picking calls, using chatbots or for online feedback. Optimove (2016) argues that the online platform can be used to supply information to customers such as new products and offers with much ease. This approach is vital for the organization to attain the much-needed improvement in customer service reception.

This modification can be made by creating an application that will allow customers to book or place orders online or on their smartphones an hour or a few minutes before they report to the cafe. The application could use a platform that is suitable for all operating systems for smartphones. The application could allow customers to place orders 20 to 30 minutes before getting to one of the cafes (IT Knowledge Portal, 2016). Using a GPS system, the application can inform the customer of the various cafes that are open, allowing the customer to choose the one that is most convenient for them. The customer could then place the order and by the time he or she gets to the cafe, have the order ready for the customer, and this would reduce the queues to a great extent.

Alternatively, the cafe needs to have more customer attendants working. With the cafes having two to three staffs serving a long line of customers, queues are inevitable. Improving the service by hiring additional staff could have some unbelievable benefits to the customers. First, by having additional staffs attend to the customers, the lines would be significantly much shorter. Likewise, if this is coupled with the online booking system, there are many merits that can be accrued. The system will allow the staff to have enough time to prepare the set orders. The application should also notify the customers when their order is ready. Such an application would help solve the queues, but the additional staffs are required to ensure that the system does not fail the customers, but rather is more effective and reliable.

Another problem that was identified with the visit to the Cafe is the use of paper membership cards. Loyalty cards that are online based are more effective. They could be coupled with the booking system, allowing the organization to maintain a large database of customers. Besides having an online or virtual loyalty card, the application can help maintain records of customer orders and using this information; the application can give customers recommendations on new products based on their previous preferences (Dubois, 2010). Additionally, having a real-time customer service system that is connected with the loyalty card can enable Caffè Nero to create a platform for rewarding the customers for being loyal to the brand.

Retaining the Customers

Retaining customers entail the development of solutions to existing CRM problems, and this can be achieved by improving just minor aspects of the business (Little & Marandi, 2003, p.24). First, the organization undergoes some problems with its existing customers. Some solutions to these problems have been outlined in the preceding section. The long queues are the first problem that affects customer service at Caffè Nero. To retain the customers, reducing the time to wait on queues using the technological advancements prescribed above can help the organization retain most of its existing customers, and even improve the customer service experience allowing the existing customers to bring with them more customers. As such, it is instrumental to note that long queues and the waiting time before the service.

Another main change that can be adopted to improve the customer service is the addition of another restroom. Currently, there is only one unisex restroom within the cafe. However, we can modify the service delivery to customers by adding another toilet. Having separate restrooms for both genders is vital as it is the current norm in all other organizations. Although at times it is crucial to be different from the industry standards, this is a sensitive issue that needs to be solved (Nasir, 2015, p.10). Besides adding another toilet, having a larger restroom can be instrumental. People go to restrooms to freshen up. The better the restroom, the more the customers will be satisfied with the service being offered by the business. Although this has nothing to do with the product, it is instrumental when it comes to customer service. For customers to have a really pleasant time at the cafe, it is good to modify the business to fit the majority of the customer suggestions or demands.

Generating Trust

Creating customer trust is essential for the organization. Building customer trust mostly entails curtailing customer loyalty. There are numerous approaches that can be applied for an organization to build customer trust. First, ensuring that the organization is able to maintain its quality and its brand is the first thing. Customers like predictable businesses; businesses which they can count on. To be predictable as a business person, the first approach entails having a consistent quality product and service. Ensuring that services are effective is another approach. The organization will have to hire extra help for it to increase efficiency and build trust. Having separate gender bathrooms is also advisable for the institution to make its customers more comfortable and willing to return a second time.

Other Recommendations

Essentially, there are multiple issues associated with the development of sound solutions that have been made with the organization. Arguably, that there have been countless issues associated with the development of a good CRM. Any good CRM has a number of attributes which include flexibility, efficiency, the speed of service delivery and customer appreciation. Some of the modifications that can be made to the existing customer service strategy of Caffè Nero include creating a customer lifecycle, software integration, and steady online and social media marketing. Although social media strategies are extremely vital and instrumental in organizations, monitoring good customer relations on social media must also be implemented by the company (Gummesson, 2008, p.15).

A customer lifecycle is vital. However, currently, bearing in mind that the organization still uses paper loyalty cards, saving such information can be extremely difficult. For a CRM strategy to incorporate this form of modification, Caffè Nero must use a more digitized system to manage customer relations. This database maintains the customer’s preferences and orders and uses a form of an algorithm that allows the organization to monitor customer activity and their purchases within the organization to offer recommendations, give discounts and promote offers that are related to the customers’ tastes (Chaffey & Ellis-Chadwick, 2012). Once a customer leaves the organization, the system will show people who have become inactive, monitoring some of their complaints or evaluating the cause of them withdrawing from the organization.

Social media marketing and customer service is also an instrumental tool for contemporary businesses. When businesses can market themselves on social media, in the contemporary business environment, they are highly likely to attract more customers and likewise, they are also highly likely to promote better feedback from customers (Peelen & Beltman, 2013, p.27). Having a social media strategy will be instrumental in this organization. Arguably, one of the best approaches is to have a social media CRM division that will ensure that the organizational image on social media is attractive and highly effective in facilitating customer attraction and retention. Giving feedback on social media platforms also makes this organization highly effective as well.

Likewise, digitizing the entire CRM system and integrating software to facilitate better customer service management is another recommendation that must be implemented. Arguably, some organizations have managed to develop sound software solutions for CRM. Customer management systems are more effective than manual or analogue customer records management. Needless to say, times are changing, and the internet, software, and applications are the future of all industries, including the hospitality industry. Therefore, restaurants are slowly incorporating highly effective technology, and Caffè Nero should not be left behind. The new software can bring in more opportunities than expected and can drive the organization’s profits higher. These three recommendations must be implemented in the organization for it to perform better than the competition, and for it to retain its customers more effectively.

Conclusion

Caffè Nero has a number of strategies that it must adopt to improve its performance. Customer relations management is vital in contemporary business as the business environment has become very competitive. To avoid losing customers to the competition, Caffè Nero must implement the aforementioned strategies. These changes are likely to affect the organization, and therefore, when implementing the new CRM strategy, putting in place proper change management strategies will work greatly towards furthering the organization’s performance and its overall output. Additionally, the restaurant must digitize and incorporate software and the internet in customer relations management. Since this is where the business world is headed, the company must conform to these new innovations or it will lose all its clientele to the competition.