Cutting edge issues in service - Assignment Example

Cutting Edge Issues in Service Contents Contents 2 3 Car Dealership and s 3 5 Relationship Marketing (CRM) in Perry’s 7 Recommendations to enhance the CRM at Perrys 11 Conclusion 12 13 References 13 Abstract Service industry and the Customer Relationship Marketing are related with each other. CRM is defined as a process which gets implemented by company so to handle the customers efficiently by storing the information of its current and prospective customers. CRM is mainly used by business in order to improve the service which is provided directly to the customers and to use the valid information to target the sales and marketing purpose.

Similarly this project deals with analyzing the customer relationship marketing activities of Perry, which is an automobile dealer in UK and deals with the sale of reputed brand cars. This paper talks about the theories in relation to CRM particularly in the service sector and how with the adoption of customer relationship marketing, Perry can improve its customer base and induce more customers. Finally a set of recommendation, which included the use of the internet, was provided to Perry. Objectives To have an in depth knowledge about CRM How Perry has implemented CRM in its service Future of CRM in the service industry Car Dealership and Customers Automobile or car manufacturers tend to gain an increased consumer space in the retail markets through the availability of service rendered by the dealers.

The manufacturers in turn need to maintain and coordinate with their dealership and franchisees in a regular manner to avoid conflicts in regards to rendering services to the consumers (Mangin, Koplyay and Calmes, 2007, p.60-61; Boone and Kurtz, 2012, p.588). Further the car dealers also focus in gaining profit from conducting their sales but at the same time require maintaining effective relationship with the consumers. Dealers have to gain a tradeoff between the impeding pressures of the car manufacturers in selling large volumes and the consumer’s demand in gaining the automobiles at lower prices.

Thus the dealers are required to gain effective information of the market demands and thereby create attractive packages involving car loans and discounts to attract the people to purchase cars from their end (Clarke, 2003, p.73-74; Pride and Ferrell, 2006, p.327). Relationship marketing is cornered with the developing, attracting and also retaining the customer relationships. A good and impressive relationship between the buyers and the sellers is one when both the concerned parties receive value in the course of doing the business.

The concept of CRM has tended to catch the picture of the academics as well as the people from the related industry. Thus it can be said that CRM is a tool which helps to build in relationship and not transactions; it tends to access the value of its customers and finally it works with well defined technology (Nargundkar, 2006, p.357). In service industry, customer deflations are recorded to be highest and this happens mainly due to unsatisfactorily result on the part of the service sectors. It is important to understand the drivers which lead to customer deflations also known as customer churn and it is recommended that the service sectors should effectively work on reducing such factors and concentrate on satisfying the needs of the customers.

Figure 1: Factors that Drives customers away from the service industry (Source: Lovelock, 2010, p. 360) According to the findings the importance of addressing the customer deflations are mainly due to quality services, minimizing the inconvenience, transparent and fair pricing and monetary cost. Other than these generic problems, there are other industry related drivers which leads to customer churn (Lovelock, 2010, p. 360). Adoption of new technology has also added to a new dimension in the process of relationship marketing basically adopting the form of CRM.

With an increased global competition and an urge for the manufacturer to produce differentiated products, companies have started to move away from the product centric view and had adopted the customer centric approach and this is done through CRM. The application of CRM includes, targeting the potential customers as well as managing the marketing promotions and campaigns; automation of the sales force team; help desk; call centers and customer service (Nag, 2008, p. 313). In the recent past years most of the vendors and the dealers have been diving slowly in order to clear off the stocks in their respective warehouse.

It is usually the case when the sky high profits earned by the automobile industry comes to an end and there are no marketing gimmick to apply on its customers, then the automobile industry need to survive in the competitive market become the topmost priority of the car vendors and dealers (Jiang, 2012). The car buying experience is one kind of love hate relationship for the people residing in USA. Customers love to drive their new car but it is the process that puts most of the potential customers with fear and loathing.

In order to tackle the problem, the automobile industry has finally has changed its face manily because of its own survival in the competitive market and to gain a competitive advantage. Thus with the adoption of CRM it can help increase its sale process. The potential payoffs in the automobile industry are huge, good CRM tends to drives out the bad sales as well as marketing efforts and the expenditure incurred reach nearly about 30% of the cost for a new car. It has been surveyed and analyzed that in the multichannel world, the automobile industry has discovered that the potential customers are generally not interested into the details, only interested in the products and tends to remember the product only (Compton, 2000).

However with the adoption of CRM, the service industry has become efficient and effective with respect to its customers. But however there exists certain issue with the usage of CRM. Some of the major issues include implementation of CRM, administration and adaptability, ease of use, price and scalability. As per the experts, the effective management of CRM should involve technology, effective and efficient sales team; well defined business process, analyze the customers and most important well trained employees to guide the customers and make them the loyal customers of the brand.

In relation to car vendors and manufacturers, by analyzing the customer base, the vendors can effectively launch marketing promotions in different parts differently according to the taste and needs of the potential customers. Figure 2: Application of CRM in Automobile industry (Source: Jiang, 2012) CRM has been criticized as it tends to manipulate the customers and especially when CRM is regarded as “cause related marketing”, when the linkage between the customer and the brand is built by portraying to b a caring brand and satisfying the needs of the customers in specific sectors.

CRM tends to make ethical and relational consumption, critical theorist; Marcuse (1964) termed it as deeply manipulative. According to Smith and Higgins, (2000) ethical choices offered through CRM is not a mater in case of moral judgment but are clearly subject to decision making with respect to shopping (Carter, et al., 2011, p.160). Customer Relationship Marketing (CRM) in Perry’s In the light of the above discussion the paper focuses on analyzing the customer relationship marketing activities of Perrys a large automobile dealer in United Kingdom dealing with the sales of cars from reputable brands.

In regards to enhancing their relationship with the consumer base the dealership company has incorporated in its website an area through which the consumers can render complaints and potential feedback. The site also contains testimonials of people who have already availed their service. All this features lead to a better CRM which guaranteed to keep the customer. The figure below demonstrates the beneficial effects. Figure 1 Titel: Why customers are more profitable over time Scource: Why are customers more profitable over timefrom Frederick R.

Reinhard and W. Earl Sassar, Jr. “Zero Defections: Quality comes from service” Harvard Business Review 73 (Sep- Oct 1999) p.108 This also creates a positive and transparent image of the concern in the public’s eye (Perrys, 2012; Genat, 2004, p.32-33). Further the company to enhance its relationship with the consumer base also focuses on marketing its several warranty, financing and insurance packages along with other key service deliverables through the web page created. Through the above activities the company tends to effectively communicate with their consumers in terms of offers and opportunities available (Perrys-a, 2012; Brink and Berndt, 2009, p.36-39). It is found from the above discussion that Perrys depends largely on the internet to help market its products and services to a larger consumer base in the United Kingdom market.

Internet has emerged as one of the growing mediums for helping in the sale of automobile products to a larger consumer space in reflecting a rise of around 11 percent in automobile sales during 2010 as against 2009. On the contrary the sales in units through other mediums failed to reflect any such rise. With the help of the internet the automobile dealers can effectively communicate the different offerings and other value additions rendered in the automobiles to the consumers in an enhanced fashion.

Along with internet the telephone communication also appears to have rendered high amount of effectiveness in the dealership functions related to sales of new and used cars to the consumers. In total the internet and telephone communication media has helped to increase the sales of automobiles by around 9 percent during the 2009 to 2010 period. Thus the automobile dealers tend to enhance their relationship with the consumers in an effective fashion with the help of internet and telecommunication media (Mintel Group Limited, 2011; Plunkett, 2006).

Again the use of internet as a communication tool used by car dealerships helps in retaining a large pool of customers. The consumers can learn from the internet sites of the car retailers and dealerships where car Dealerships Company through the use of such sites can give effective testimonials of other consumers. Such learning helps the company in enhancing its relationship and communication base with the consumers in providing them effective information needed to be gained prior to making a purchase of automobiles from the dealer’s end.

Retention of consumers helps in enhancing the goodwill of the company in the market and also enhances its competitiveness in the automobile dealership market. Moreover the creation of an internet page by the dealership company to enhance the level of relationship marketing with the consumers in turn creates a differentiated image of the concern. This differentiation enabled in the sphere of customer relationship activity helps the automobile dealership company in gaining the attention of a larger consumer base in the United Kingdom market (Ahmad and Buttle, 2001, p.

40; Morton, Zettelmeyer and Risso, 2001, p.503-505). Perry can handle the issue of CRM with the help of the CRM pyramid. Figure 3: CRM Pyramid As stated above with the adoption of technology, CRM has lead to the increase of sales similarly Perry can also increase its sales with effective adaptation and implementation of the required technology. When technology becomes stronger, marketing and sales also tends to form effective part which would help to retain the customers and attract new and potential customers.

This can be done through product offering based on the requirements of the customers and finally leads to satisfaction of the customers and most importantly will increase the loyalty of the customers towards Perry and its products. Recommendations to enhance the CRM at Perrys In the light of the customer relationship activities maintained at Perrys using the internet as an effective tool for marketing its products and offerings to a large consumer base in the United Kingdom market evaluating the level of consumer trust earns priority.

Consumers who transact via the online sphere in choosing the product for purchase and thereby proceed to procure the same through availing the different offers and promotions rendered tend to create a different perception. These consumers tend to enjoy a level of comfort while transacting or gaining information via the online sphere. The business companies like automobile dealers in order to sustain such increased level of perception and satisfaction needs to meet the demands of the consumers through acting on the physical plane in rightly delivering the products on time.

Moreover the company can also work in effectively addressing the queries and complaints of the different consumers via the online sphere accurately and timely to enhance the company’s relationship aspects with the consumers at large. The level of trust and perception of comfort in regards to the consumers being enhanced would help the company in augmenting its goodwill in the market (Luo and Lee, 2011, p.834-835; Linoff and Berry, 2011, p.7). The dealership function of Perry’s along with other such car dealers can be better enhanced in letting the companies maintain a sustained relationship with the different consumers.

Thus the dealership companies should work on the parameters of product, pricing, distribution and promotion other than enhancing the parameters of physical evidence through the use of testimonials and business processes encouraging consumers to transact in an online fashion (Kotler and Armstrong, 2008, p.49). Henceforth the company should effectively work at sustaining a developed product base in gaining automobiles from branded companies. Further in regards to pricing the company needs to render offers and promotions time to time to create excitement among the consumers.

The car dealership can also expand its units on a regional basis to help the consumers gain easy accessibility of services. Authorized service centers can be created by the dealership in different regions to render repair and other services both during and after the warranty period. Finally the car dealership also needs to act on several promotional and advertising models both through the online and physical sphere. In regards to the online sphere the company can work in creating a page in the social networking site to gain consumer feedback and interactions and thereby enhance its communication activity with the consumer sphere.

Other than acting on the online sphere the company can work in the increase of hoardings and other audio-visual system advertisements with also working to augment the level of print advertisements distributed through newspapers and magazines focusing on automobiles (Peach and Karen, 1996; Foss and Stone, 2001, p.420-421). Conclusion Perrys an automobile dealership operating in the United Kingdom market is found to interrelate with its customers in an enhanced fashion to largely inform them about the different models available with effective offers and packages.

The company however is required to sustain the enhanced perception and expectation levels of the consumer through the rendering of products and services on time and also in largely advertising its image both online and physically. Such activities would help the company in effectively sustaining the large volumes of customers which would help it to enhance its competitive and business position. References Ahmad, R., and Buttle, F., 2001. Customer retention: a potentially potent marketing management strategy.

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