Chapter 3: Customer Relationship Management and Hero Honda PVT LTD

Introduction: -
Customer Relationship Management [CRM] is one of the most important thing
and customer’s problems are solve in this service. It is the powerfully tool of the
management. Here, with the help of CRM, management can know the experience of
customers about the product. The products are more important for the overall
development of the nation (at rural and urban area). The CRM is work on the
principles that, the retailers has to chat out programmers’ which would help them to
raise their profitability on a continuous basis through building long term relationship
with there customers. We have also tried to evaluate a mode of relationship based
buying which refers to those motivate of the customers. The CRM is depends upon
the customers loyalty and their lifelong goodwill or equity.
The CRM is a start of new business and process issue. The types of CRM is
develop of market and customer focused, methodology including the understand of
need based segment and development of element based proposition and the
management of maximize the customer value. CRM is the understanding of this
segment relationship and the help of customer.
The biggest management challenge in the new millennium of liberalization
and globalization for a business is to serve and maintain good relationship with the
king - the customer. In the past, producers took their customers for granted because at
these time customers were not demanding nor had many alternatives sources of
supply or supplies, since has was a passive customer, the product dictated terms and
had little customer. But today, there is radical transformation; the changing business
environment is characterized by economic liberalization, increasing competition, high
consumer choice, enlightened and demanding customer, more emphasis on quality
and value of purchase.
All these changes have made today’s producer sniff from traditional marketing
to modern marketing. The modern marketing cells for more than developing a
product, pricing it, promoting it and making it accessible to fret customers. It demands
building trust, a binding force and value added relationship with the customers to win
their hearts. The new age marketing aims at winning customers for ever, where
companies greet the customers, create products to suit their needs, work hard for

28
develop life time customers through the principles of customers delight, approval and
enthusiasm.

Customer’s relationship management:-

The process of developing a co-operative and collaborative relationship
between the buyers and seller is called customer relationship managements shortly
called CRM.
CRM aims at focusing all the organizations activates towards crediting and
maintaining a customer. CRM is a new technique in marketing where the marketer
term to development long term collaborative relationship with customers to develop
them as life time customers. CRM aims to make the customer climb up the ladder of
loyalty.

Four aims of CRM-

 Focus on long term profit: - CRM Focuses on long term profits and it ignores
the acquiring customers for single transaction to earn a little profit at present.
Company should spend for the profitable customers and serve them better at the
expense of present earn long term profits in the future.
 Retention of customer: - It is proved that the retention of existing customers is
cheaper than attracting new customers. Attracting new customers involve high
cost such as advertisement but retention cost such as serving the customer is
considered to be less. But many firms fail to recognize this and refrain from
retention strategies.
 Customer welfare at profit: - CRM says that the chosen profitable customers
should be served at the expense of present profits which will bring better profits in
the future through a loyal customer base who will not switch to competitors.
Company should provide services to customers and build long relationships with
customers and loyalty should be built from basic level to a partnership level.
 Developing the strategy: - CRM should be incorporated in to business and
marketing strategies to yield better results and entire organization should be
dedicated to serve profits to day to earn better profits tomorrow.

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 CRM process can be visually represented as follow

Customer
Relationship
Management

Orgnisation’s Customer
performanie satisfaction

Customer
loyaty and
customar
Reletion

CRM does not focus on profit from a single transaction rather it focuses on
achieving better profits’ in long term by understanding chosen customers and creating
value for them. Through CRM customer satisfied and will be bound to retain with the
originations leading to better organization process and value creation process is a
crucial element in creating loyalty.

FEATURES OF CRM –
 Focus on customer rather than revenue from single transaction.
 Creating customer value than just adding features to the product.
 Long term use of focused
 High level customer service
 High customer commitment through loyalty
 High customer contacts to identify customer needs and serve them better

OBJECTIVE OF CRM –
CRM the technology, along with human recourse of the company. Enables the
company to analyze the behavior of customers and their value the main suggest:

30
customer, relationship and the management of relationship and the main objective to
implement CRM in the business strategy are:
1. To suggest marketing and sales process.
2. To find call centers more efficient.
3. To provide better customer service.
4. To discover new customers and increase customer revenue.
5. To cross sell products more effectively.
The CRM processes should fully sport the basic steps of customer life cycle. The
basic steps are following
 Attracting present and new customer
 Acquiring new customers
 Serving the customers
 Finally, retaining the customer

Selections of the right CRM technology-

The point here is one size doesn’t fit all there is no single CRM software or
formula will give instant success to all companies, for small or medium enterprises.
The requirement is different from that of big firms; most CRM packages provide
excellent sales force automation, but not equally good integration with computer
.telephony, or with web. These are adequate for small and medium firms but not for
firms. A mix of different softer to link the data bases, data warehousing software,
contact management softer ware, and a CRM package will go a long way in helping to
upgrade the small companies.
Other internet enabled applications a available are enterprise resource
planning package commerce applications, relationship management package
,enterprise portal applications etc. one can adopt the best practices to slash costs,
introduce efficiencies into supply chain and internal operations. Today the global
market for CRM services and solutions is currently worth $148 billion this proves to
show the numerous choices availed in this field.

31
Benefits of CRM -
The main banalities’ are as following of adopting CRM processes.
 To develop better communication channels.
 Create detailed profits of in dividable customer.
 Increased customer satisfaction.
 To collect customer related data.
 Identify new selling opportunities.
 To increased revenues.
 Access to customer account history, order information, and customer
information’s at all touch point.
 To increased market share and profit margin.
 Improved customer service and support.
 To more effective reach and marketing.
 Enhanced customer loyalty.
 Better stand against global competition.
 Reduced cost of buying and using product and services.
 To improved quality communication and services.
 To improved ability to meet customer requirements.

The Process of Customer Relationship Management:

1. Basics of customer relationship management: - The customer relationship
management process involves strategic decisions that are based on the needs,
input and feedback of customer. Businesses that incorporate CRM work form an
outside-in-model, rather than forcing their ideas on to the customer to building
business. The customer is the mingier in a CRM model. Everything from
technology to pricing, sales techniques and educations revolve around the
customer. Departments that serve the customer, including marketing, sales and
customer service are integrated so that budgets and business involve all parties of
marketing.
2. Marketing: - Beyond data collections, CRM relies on personal integrations with
clients through mutual interest networks, such as industry associations,
community groups and philanthropic endeavors. CRM encourages sales to
communication with customers, based on mutual interest and concerns;
relationship marketing involves gives- and- take. In additions to the products and

32
 services a sale person may be offering. Marketing professional may provide
business leads to client who doesn’t make an immediate purchase. Laying a
foundation of interaction with a new client is just as important as an imminent
deal.
3. Long – term benefits: - By focusing marketing efforts on building efforts is
tantamount touches. Companies can direct their efforts at the types of clients who
are open to continuing relationship. Partnerships are formed with customers who
are open to continuing relationship, partnerships are formed with customers who
feel they are part of company’s success, and who strongly believe they are
receiving benefits in return for continued loyalty. Clients who do not respond to
relationship. Building techniques can be moved to a different form of sales
management.
Monitor time and effort spent, and the results gleaned from each relationship
time are the primary resource needed to build a strong relationship clientele.
Marketing efficiency is enhanced when CRM processes and the means to monitor
them are incorporated into the strategic plans of any business.
4. Networking: - Beyond data collection, customer relationship management relies
on personal interaction with clients through mutual interest networks, such as
industry association’s community groups and philanthropic endeavored CRM
encourages sales and marketing professionals to more beyond sales to
communication with customers, based on mutual interests and
concerns.Relationship marketing involves give-and –take. in additions to then
products and services a salesperson may be offering , marketing professionals may
provide business leads to clients who don’t make an immediate purchase. Laying
a foundation of integration with a new client is just as important as an imminent
deal.

Some of the commonly established CRM objective:

1. Increase in customer service: - Establishing customer loyalty as one of your top
CRM goals is ability fundamental to CRM successful implementations. For this
task it is essential that whole organization realize that they play apart in this goal.
This objective can objective cannot be achieved with the help of a few employees
only. Customer need to fees that have received excellent service, this is by far one
of the most essential goals of customer relationship management customer

33
 retention and brand loyalty is absolutely essential to ensure success. Undoubtedly
it is for harder to gain a new customer than to actually keep one customer service
is the pivotal point around which CRM devolves.
2. Increasing efficiency: - One of the most important goals of CRM is the increase
in organization efficiency and effective’s. This is almost always adopted by every
organization. It is required to boost success. CRM achieves this through cost
reduction and customer retention. Adequate CRM training achieves these goals.
3. Lowering operating costs: - CRM goals also induced the reduction of cost of
operations. This goal should be clearly established and conveyed to all those
involved in the CRM implementation process. CRM manages to reduce operating
costs through a workforce management system. These reduced costs enable an
organization to achieve greater efficiency. If cost reduction is management’s
objective then the CRM implementations should be carried out in such a way that
this is achieved. Throughout the process maximum reduction in costs should be
adhered to in order to meet these particular CRM goals.
4. Aiding the marketing Department: - Another goal of CRM is generally aiding
the marketing department in all its efforts. This includes marketing campaigns,
sales promotions etc. if these is fixated as one of the goals of CRM, then it should
be communicated to those involved. These goals are fundamental as it boosts sales
in directly thereby increasing the profitability.
The biggest management challenge in the new millennium of liberalization
and globalization and for a business is to serve and maintain good relations with the
king customer .the past products took their customer for granted because at that time
customers were not demanding not had many alternative source of supply or suppliers
since he was a passive customer the producer ducted terms and had little customer
commitment. But today there is a radical transformation. The changing business
environment is characterized by economic liberalization, increasing competition, high
consumer choice, enlightened and demanding customer, more emphasis on quality
and value of purchase.
All this changes have made today ,s producer shift from traditional marketing
to modern marketing call for more than developing a products, pricing it promoting it
and making it accessible to target customer .it demands deluding trust , a binding
force and value added relationship with the customers to win their hearts .The new
age marketing aims at wining customer for ever where companies greet the

34
customers, create products’ to suit their needs, work head to develop life time
customers through the principles of customer delight ,approval and enthusiasm.

What Is Customer Relationship Management (CRM)

The process of developing a cooperative and collaborative relationship
between the buyers and sellers is called customer relationship management shortly
called CRM. CRM aims at focusing all the organizational activities towards creating
and maintaining a customer.CRM is a new technique in marketing where the marketer
tries to develop long term collaborative relationship with customers to develop them
as life time customers. CRM aims to make the customer climb up the ladder of
loyalty.
CRM Process:

Customer
Customer
Relationship
Satisfaction
Management

Orgnisations Customer
Performance Loyalty

CRM dose not focus on profit form a single transaction rather it focuses on
achieving better profits in long term by understanding chosen customers and creating
value for them. Through CRM customers gets satisfied and will be bound to retain
with the organization leading to better organization process and value creation process
is a crucial element in creating loyalty.

35
Features of CRM:
 Focus on customer rather than revenue from single transaction.
 Creating customer value rather than just adding features to the product.
 High customer focused
 High customer commitment through loyalty
 High customer contacts to identify customer need and serve them better

Objectives of CRM:
CRM the technology, along with human resources of the company, enables the
company, enables the company to analyze the behavior of customer and their value.
The main areas of focus are as the name suggests: customer, relationship and the
management of relationship and the main objectives to implement CRM in business
strategy are:
 To simplify marketing and sales process
 To make all centers more efficient
 To mate call centers more efficient
 To discover new customer and increase customer revenue
 To cross sell product more effectively
The CRM process should fully support the basic steps of customer life cycle
the basic steps are :
 Attracting present and new customers
 Acquiring new customers
 Serving the customers
 Finally, retaining the customers

Concept of Customer Relationship Management

The concept of Customer Relationship Management has its roots in
relationship marketing. The following figure present the triangles showings
difference between those terms.

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 Relastionship
marketing customer
orintations

Customer

Customer relationship Measurement and

management evaluations customer

Relationship marketing brought new approach to relations with customers,

creating at the same time new market assumptions. CRM is a business strategy
focused on maximizing shareholder value through winning, growing, and keeping the
right customers. We can distinguish here two important elements. First of all,
concentrating on the most important from company’s perspective customers and
second of all retaining long-term relationship with them. That is why it is essential to
collect consequently customers’ opinions, complaints and new needs. In this way it is
possible to approach a client more individually, and make them feel important for the
company, because each company is worth as much as customer values it. Satisfied
client will also recommend company’s products to their friends. Therefore the main
challenges are:
 Building long - term partner relations with customers,
 Identifying and focusing on the most significant customers,
 Acquiring and retaining new customers,
In developing CRM strategies whole organizations should be engaged. It
includes adequate approach in terms of sales, marketing and customer support. A truly
comprehensive picture of a customer might include information collected by sales
partners, suppliers or collaborative service deliverers. When company limits whole its
attention only to operational activities, it can decrease communication between
business and customer. Initial CRM implementations should be based on adequate
information and perspective about customers and the firm’s demand environment.
Once implemented, CRM should allow organizations to see beyond the boundaries of
the internal enterprise, and collect, analyze, and leverage such insight. It should
include following issues:

37
 Understanding markets and customers (gathering market information, Selecting
target markets),
 Ability of dealing with different customers in different ways,
 Focusing on one-to-one relations by satisfying needs of individual customers,
 Developing an offer (selecting products, positioning, differentiating),
 Providing customer care (delivery process, service process, support, loyalty
programs).

FACTS OF CRM:
CRM is a methodology to achieve global excellence through customer
satisfaction. It observed to a customer’s history, need and co- ordinates companies
multi- pronged interaction with its customer for business excellence. CRM tentacles
reach every area of business. These are:
 Customer needs
 Customer response and influence
 Customer satisfaction
 Customer loyalty
 Reclaiming lost customer
 Customer complaint
 Customer services

Importance of CRM:
CRM help the organization to identify to the customer need and re-focus its
strategy to serve him better. It helps the company to achieve business growth through
development of competitive edge and excellence. Some of the major issue it adders
are:
 Identify customer need.
 Help in rediscovering the customer and understanding him.
 Identify untapped business prudential.
 Identify fields requiring new technology and development.
 Identify strong and weak points of supplier.
 Provide feedback to the supplier on his total operation.
 Provide feedback and new information on competitors.

38
  Details on the aspects on which customer is happy with the supplier and on
those were he feels that important need to be incorporated.
 Action plan to make organization customer centric.
CRM is a strategic business and process issue. Those principles of CRM are
developed out of / customer focused, the development of segments based prospection
and the management of delivery against those propositions to maximize the customer
value. CRM is the understanding of this segmental relationship and the customer
ability to generate action plan to help the customer. An effective CRM result in
maximizing business and profits throughout the customer life cycle. CRM maximizes
the value of company’s customer profits throughout convergence of marketing,
services and sales.

CRM AND MARKETING

CRM is a tool to be leveraged by supplier in assisting its marketing efforts to
enhance its business and profitability. The first and foremost requirement is to assess
the need desire of the customer and to ascertain whether the company can meet them.
The requirement can be with respect to price, quality or customer friendly features
and service. For core sector project it many additionally incompletion time. Some of
the important aspects of CRM in marketing discussed below:
1. The supplier can then evaluate whether it can meet customer it can meet customer
need and if so he should devise suitable strategy and action plan the customer. In
case of segment, individual customer may be not the focus but market segment
and the can be broadly treated as a customer and its requirement suitable
addressed. It may so happen that customer needs may differ in different market
segment and the supplier has to develop different product variations to suit
different marketing segments provided they are in tune with the value system of
the supplier.
2. It is often seen that a complaining customer gets high attention of management of
the supplier but a good and tolerant customer who is giving business to the
company and is more loyal to the company does not get the attention because he is
understanding and tolerant and not the complaining type. Logically the letter
customer should get better attention from the supplier. Thus the foremost

39
 requirement of CRM is that an organization should objective and logically
assesses the requirement of the customer and give him the attention be deserves.
3. The supplier must assess the value of the customer to him and give more attention
to the customer who has more value for the supplier.
4. The supplier should be able to identify needs of the customer, should differentiate
between them and give them attention accordingly.
5. The supplier must assess his cost of serving the customer and his returns from
him. He will be in business only if he is a gainer.
6. CRM helps the supplier in giving focused attention to individual customer.
7. CRM helps a supplier to develop preference and liking for him by customer and it
helps him in maximizing his return and establishment customer loyalty
CRM is an art of increasing the value to the customer and providing him more
comforts and meeting his requirement. In many cases the product may be the same
but its delivery can make the difference.

Market Research and Customer Relationship Management

One the biggest application of marketing research is in the field of Customer
Relationship Management. It helps a supplier to have feedback on its performance,
get different customers opinions and about how they rate different suppliers in the
field. It is also provides an opportunity to the organization to revalidate whether
strong and wake points it had attribute to itself are also shared by its customers and
the kind of difference that exist and reasons for it . It also helps the organization arrive
at customer satisfaction index. It can be give feedback on the following subject:
 Satisfaction level of customers with the company in general and more specially
with its technology, quality, service, performance, completion schedule and price.
 Identify strong points for leveraging and weak points for improvement to further
increase customer satisfaction.
 Create data bank on the company is ahead of it is lagging behind.
 Price sensitivity
 Market share and reasons for its it rends
 Possible business solutions to various problems
It may be appreciated that through in infrastructure projects the organization
and its officials are always face with customers. Rarely negative feedbacks given

40
across the table. At best negative feedbacks are passed on as suggestion for
improvement. Similarly no customer in reality gives position in negotiations. It is
therefore necessary to have a professional feedback, as many not like their identities
to be revealed.
In the case of consumer sector supplier and customer rarely come face to face
with each other and hence the supplier dose not he opportunity to get feedback
directly. Whatever feedback he gets is through his agents and middlemen distributors,
which is rarely holistic, structured and analytical. Business conclusions and strategies
for professional market survey to be conducted for getting authentic customer
feedback and other customer related information.

Seven Guidelines for Effective CRM

The CRM market and our collective experience have matured. Whether we are
remarketing on an enterprise wide strategy or specific functional point solution, we
have learned to apply best practices and lessons learned to help ensure success form
our CRM investment, and as a result I would recommend that each organization
considers the following seven tips for highly effective CRM prior to implementation
and deployment of initiative:
1. Changes in process, people, and technology should be evaluated and the business
impact should be quantified and prioritize supported by a solid business case and
tangible return on investment.
2. Develop and an iterative and incremental approach focused on addressing the
highest value opportunities first think big star small, and deliver results quickly.
3. Align to corporate strategy, ensuring that CRM initiatives are in complete
alignment with the organization overall business goals.
4. Measure the effectiveness of your initiatives and create accountability for
customer and results. What are your baseline performances and what key
performance indicators will you measure to know that you are getting results from
your CRM Initiatives?
5. Create an overall CRM vision to the company . develop and communicate the
CRM vision to the organization and key constituents, such as customer,
employees and partners.

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 6. Secure the commitment and buy in of senior management to the overall project
vision, project objectives and measurement of the sustain the future state of
organizational readiness.
7. Recognize the organization change and motivations required to active full
benefits, and create the action plans to achieve and sustain the future stat of
organizational readiness.
These seven types will not guarantee your CRM success. However, if your
organization has a plan to address these areas you will improve your chances of
success and reap the rewards of profitable, customer focused strategies.

Principles of Customer Relationship Management (CRM)

Most of the customer relationship programs are developed on the basis of
certain principles, which enunciate that it is necessary for organizations to maintain
mutually beneficial relationships with their customers for the long-term benefits of
both the parties. The basic underlying principles are as follows:
1. Principle of ‘Customer Life-time Value’ (CLV)
2. Principle of 'Customer Satisfaction'
3. Principle of 'Customer Loyalty'
4. Principle of 'Share of Customer'
5. Principle of 'Cross-Selling and Up-Selling'
6. Principle of 'Customer Profitability'
1. Principle of 'Customer Life-time Value'
This principle states that the value of the entire stream of purchases that the
customer would make over a lifetime of patronage is far higher than the value of a
single sale. In view of this fact organizations should seek to establish good
relationships with the customers for conducting repeated business with them. Value of
the customer for the company can be understood as the amount by which revenues
from a given customer, over time will exceed the company's costs of attracting,
selling and servicing that customer. A dissatisfied customer who is moving out of any
organization should not be viewed as a sale lost for one time, rather the organization
should realize that it is losing the entire stream of revenues which could have been
generated by the customer, if he/she were happy with the products/ services and
continued to be a customer.

42
 For example: If a customer during a year is conducting a business worth one thousand
units with a firm, and the average period of his conducting business is estimated to be
ten years, then it can be concluded that the value of the business the customer is going
to deliver to the firm can be treated as ten thousand units. If the customer is lost at the
initial stages then the value of transactions lost is ten thousand units.

2. Principle of 'Customer Satisfaction'

Customer satisfaction is defined as the extent to which a product's actual
performance matches a buyer's expectations. A customer might experience various
degrees of satisfaction. If the product's performance falls short of expectations, the
customer is dissatisfied. If the performance matches the expectations, the customer is
satisfied. If the performance exceeds expectations, the customer is highly satisfied or
delighted. Therefore it is very important to ensure that the marketing and
communications programs along with the offerings match the expectations of the
customers.

3. Principle of 'Customer Loyalty'

This principle states that highly satisfied customers produce several benefits to
the company. They are fewer prices sensitive, spread good word-of- mouth and
remain loyal to the company's products and services for a longer period. It takes a lot
of effort and time to make a customer loyal to the firm's products and services. A
consistent effort in delivering products and services to the expectations of the
customers is the key to make the customers loyal. Once a customer becomes loyal to
the company's products and services, he feels an affinity to the company and it
becomes difficult to defect to competitors' products.

4. Principle of 'Share of Customer'

This principle means that if any company goes beyond the idea of attracting
and Retaining good customers, it can capture a greater share of the customer's
purchasing in their product/service categories, either by becoming the sole supplier of
the products, the customer is currently buying or by motivating the customer to
purchase additional company products.

43
5. Principle of 'Cross-Selling and Up-Selling'
Cross-selling means getting more business from the current customers of one
product or service by selling them the additional offerings. For example a banking
company would like to offer additional services like insurance and vehicle/ education
loans apart from regular banking services like savings and deposit schemes. Thus it
can cross-sell other products to the customers. Encouraging a customer to purchase
products that are higher in value and more profitable is treated as up selling. Fuel
retail outlets offering products like lubricants apart from the regular fuel could be
considered as an example of Up-selling.

6. Principle of 'Customer Profitability'

This principle states that while implementing a relationship program it is not
wise to maintain similar relationships of high value with all the customers. The
principle a advocates attracting, keeping and maintaining profitable customers. In fact
relationship is based on the value offered by the customer to the company and the
Value created by the company to the customer.

Benefits of Relationship Marketing: - Relationship marketing helps in:

 Building customer loyalty and commitment.
 Offering personalized services and products, based on customer group
preferences.
 Reducing the burden of excessive customer acquisition costs.
 Enhancing marketing effectiveness by carefully selecting customers for various
programs.
 Developing better communication channels.
 Collecting vital data, like customer details and order histories.
 Creating detailed profiles such as customer preferences.
 Delivering instant, company-wide access to customer histories.
 Identifying new selling opportunities.
 Providing more avenues for customers to communicate and explain their needs to
the organization through numerous contact points.
 Increasing satisfaction among the customers

44
 Making customers feel important because of the increased personalization of
Services and customization of goods offered to them.
 Increasing the percentage of cross-selling.
 Attracting new customers and closing deals faster, through quicker and more
efficient responses to customer leads and customer information
 Simplifying the marketing and sales processes by better understanding Customer
needs.
 Offering better customer service - through improved responsiveness and
understanding that builds customer loyalty and decreases customer turn over.
 Identifying the best revenue opportunities for the organization
 Improving the revenue through acquisition of new customers, retaining existing
customers, and increased share of customer through up-selling, cross selling, etc.

Need of Relationship with Customers

Building relationship with customers in current market trends is the most
important aspect that an organization should focus on. Distinction and eminence are
now most sustainable and affirm for which developing good relationship with
customers is must. Some of the substantial outcomes of building a quality relationship
is explained below by which need of relationship with customer are insight.

 Better Customer perceptiveness: As the customer lengthens to deal with a

supplier, the supplier tends to explicate a better insight of customer’s needs and
expectations. By this a high level of relationship can be developed between them.
This will result in selling more products and retain the business with the
customers which finally will lead to profitable business.
 Lead to Customer Satisfaction: Customer satisfaction is the measure of how the
needs and responses are collaborated and delivered to excel customer expectation.
It can only be attained if the customer has an overall good relationship with the
supplier. In today’s competitive business marketplace, customer satisfaction is an
important performance exponent and basic differentiator of business strategies.
Hence, the more is customer satisfaction; more is the business and the bonding
with customer.

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 Lead to Customer Loyalty: Customer loyalty is the tendency of the customer to
remain in business with a particular supplier and buy the products regularly. This
is usually seen when a customer is very much satisfied by the supplier and re-
visits the organization for business deals, or when he is tended towards re-buying
a particular product or brand over times by that supplier. To continue the customer
loyalty the most important aspect an organization should focus on is customer
satisfaction, hence it can be said that customer loyalty is also an outcome of good
relationship.
 Lead to Customer Retention: Customer retention is a strategic process to keep
or retain the existing customers and not letting them to diverge or defect to other
suppliers or organization for business and this is only possible when there is a
quality relationship between customer and supplier. Usually a loyal customer is
tended towards sticking to a particular brand or product as far as his basic needs
continue to be properly fulfilled. He does not opt for taking a risk in going for a
new product. More is the possibility to retain customers the more is the probability
of net growth of business.
 Chances of getting referrals: It is always a cost-free advocacy by customers to
provide referrals to supplier when they feel satisfied and encouraged and when
they have a healthy relationship with customers. These referrals or customer’s
reference of other customers acts like a piece of cake for suppliers as there is no
cost and struggle involved in this. This could be treated as the best outcome of
quality relationship what a supplier can think of.
 Growth in revenue: When suppliers have healthy relationship with customers the
revenue of the organization always increases as customers tend to buy more and
more. There is possibility that a satisfied customer seek to buy special category of
related products apart from the regular ones from that particular supplier. For
instance if a satisfied and loyal customer has a home insurance from an insurance
company then there are positive chances that he could also insure his property and
car also if he is fully satisfied with the services of that insurance company. This
will definitely result in growth of business.
 Cost to serve is low: Cost to serve existing satisfied customers is always very less
for the supplier as they know and understand customers. customers never come

46
 back with complaints and queries because they know the actual business flow and
completely rely on the relationship with the suppliers

Stages of Relationship with Customers

Relationship regarding the customers may change time to time. It may be
because of evolvement under distinguished situation. There are some stages where
relationship with consumer may evolve.
 Exploration: It is the process when customer investigates or tests the Supplier’s
capabilities and performance or cross verifies the product’s or brand’s usefulness.
If the test results fail to satisfy customer’s demands, the relationship can
drastically come to an end.
 Awareness: It is the process when the customer understands the motivational
values of supplier or the products he sells.
 Expansion: It is the process when the supplier wins customer’s faith and
customer falls under huge interdependence of the supplier. This is time when there
are more chances of business with that particular customer and expand business.
 Commitment: It is a powerful stage when suppliers learn to adapting business
rules and goal to excel.
 Dissolution: It is a stage when customer requirement suddenly changes and he
looks for better perspectives. This sudden change is the end of relationship
Relationship or interaction with consumer may come to end due various
reasons. It may be because of customer was not satisfied with the organization
services or he disagrees for other better brand and product.

Calculations: -
In The Rural and Urban area development there may aspects likes’ socio
economic and cultural development. The most important process of development a
co-operative relationship between the buyers and seller is called customer relationship
management.
Customer relationship management at focusing all the organization activities
towards creating and maintaining a customer. CRM is a new technology in marketing
develop long term relationship with customer to development them as life time
customer service.

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 Research methodology was analyzed keeping in view the method analysis.
These studies have been thus benefiting for hero Honda development project to
overcome various problems to bridge between urban and rural development. The
survey which is planned here can be help to diagnose the problem and overcome the
problem in a systematic manner.
 It is the process required by the companies to build and maintain relationship with
the customer
 Customer Relationship Management softer is used to support the storing
information on current and prospective customer.
 Information in the system can be accessed and entered by employees in different
determents, such as sales marketing customer service, training performance
management human resource development and compensation.

The CRM Strategy of the company:

 Implementation of my SAP CRM:
In Indians highly competitive motorcycle manufacturing sector streamlined
operation and effective business relation are essential. To improve importation
exchange with its many partner hero Honda decided to customer relationship
management capacities we wanted to enable to dealers and suppliers to perform
online transaction explain S.R. Balasubramainan (Bala),Vice President of
information’s systems at Hero Honda was something that or legacy solution could
not support.
Hero opted for the powerful self-service feature of my sap supplier
relationship management [my SAP SRM] plus the e-commerce capabilities of my
SAP customer relationship management [my SAPCRM]

 SBI- Hero Honda credit card:

Another customer services initiative launched jointly by Hero Honda and stat
bank of India is a co-branded credit card .this time SBI Card the first card for two
wheelers industry in India. SBI card is said to be India number one visa card –issuer
with over 11 lakh cards issuer. The co-branded card is designed to strengthen Hero
Honda’s passport program.

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 Treasured Reward:
For passport members who have crossed the 1 lakh point mark in the Hero
Honda Passport program. The HHPP Treasured Reward available at 8 prescribed
milestones beginning form 1.25 lakh points and ending at 3 lakh points, with each
milestone at a gap of 25,000points in other word, the milestones are placed at 1.25
lakhs , and so on till 3lakh.
Each time a member reaches a milestone a motorcycle privilege voucher of
Rs. 1250/-will be given to him. This voucher may be used to avail a discount on the
purchase of a new Hero Honda motorcycle. This vouchers is transferable and can be
given to friends or relatives who may be planning a buy a new Hero Honda

 Star Club Treasured Reward:

This unique club has been introduced for those members who get their bikes
serviced regularly form authorized Hero Honda service centers. The star club
membership not only identifies the member as special for the HHPP family , but also
brings in some added benefits likes :
 30% discount on labour
 7.5% discount on spares, till the validity of the passports,

 Reward and Point Programme:

All this amazing rewards and benefits come to the customer as they earn point
in the different CRM programme. Once become a member, they earn points for a host
of regular transactions that they conduct at their local Hero Honda authorized
Dealership or service centers. These in clued :
 Purchase of Hero Honda genuine spares
 Purchase of accessories servicing of motorcycle

Bonus points on:

 Free service
 Paid service
 Referrals i.e. recommending a friend to purchase Hero Honda motorcycle

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 Security for customers and family –
The moment customers apply for hero Honda passport they are automatically
covered for free Rs. 100,000 Personal Accident Insurance policies for one year or
three years, as applicable.

 Special invitations
For active members of the Hero Honda passport program the chance of bing
invited to special events like musical nights, movie Screenings, Awared shows etc.

 Special Privileges…All the way –

Special discounts on spares and free services for Hero Honda motorcycle
along with attractive gifts at various milestones , this is companies way of making
sure that every time customer come to show room for servicing the motorcycle, they
take away more than just the benefit of world class servicing in their auto mated
workshops.

 Keeping in touch...All year through –

An efforts to be in constant touch with the customers through quarterly
newsletters,” Suhana Safar” The new slitters’ gives an insider’s view to the company
Hero Honda motor Ltd .along with the fastest happenings in the HHPP family .

 More value added services –

In tune with effective CRM HHML has come up with the fresh idea of mobile
service workshops a complete work shop incorporated into trucks that travel
predetermined routes, visiting small town and villages where existing customers re
side . Customers are informed that a workshop will be coming, so that they don’t have
to travel hundreds of kilometers to an authorized work shop for servicing repairs.
These mobile workshops also double as sales out lets and spare –part distributors.

 Hero Honda passport program –

Hero Honda passport programe is on of the first of its kind in India. The
company has secured over 1 million members in the last three years with passport
programmers, which involves offering members a small card/ booklet that looks like

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the Indian passport complete with “visa” stumps for points similar to those offered by
credit card companies and airlines .the only differences in this programmers is that the
member need always spend money to obtain point. With the passport programmers,
each time a hero Honda customer visits a service centre, he gets point and depend
ding on the profile submitted by the customer he gets benefits like free passes to a
cricket match sponsored by the company.

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