Crm at big bazaar


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Crm at big bazaar

  1. 1. 1. RETAIL MANAGEMENT Customer RelationshipManagement @ Big Bazaar & Reliance MartSUBMITTED BY: • Deepak Majhi 03 • Nancy 05 • AritroMukherjee 07 • Raja Rowin 35 • Gunjan Parmar42 • Lalit Mukul Kindo • Vijay Mishra • Anuradha – 63 • Anurag Singh – • Ritu Kumari - 1 1 69 772. TABLE OF CONTENTSCHAPTER CHAPTER NAME PAGENO. NO.Chapter 1 Introduction 1 Meaningof CRM Goal of CRM Evolution & growth of CRM Options for implementing CRM Various aspects ofCRMChapter 2 Research methodology 8 Objective of research Type of research Data collectiontechnique Sampling procedures & sample size Limitations of the researchChapter 3 CRM @ RelianceMartChapter 4 CRM @ Big BazaarChapter 5 Customer’s opinion about CRM @ Reliance Mart & BigBazaar Sales person’s assistance Expectation fulfilment Discounts & failures Product arrangementAccessibility preferenceChapter 6 Comparison between CRM @ Reliance Mart & Big BazaarChapter 7Conclusion & recommendation 23. CHAPTER 1 INTRODUCT INTRODUCTION ION―it is not enough to have great qualities, we shouldalso have the abilities to manage them‖ .The same concept can also be applied in an organization. Fore.g. a company may produce avery high quality products but it won’t be able to succeed if it fails tomanage or satisfy theircustomers.According to Harward Business Review ―an exceptionally satisfiedcustomer is 6 times morelikely to buy again as one who is merely satisfied & only 5% increase incustomer loyalty canboost profit from 25% to 85%‖ .Thus all these quotes & experts opinion highlights theimportance of Customer RelationshipManagement. Customers are considered to be king of everybusiness enterprise and loyalcustomers are the backbone of their business. So customer satisfaction isthe primary motiveof every business which can be attained through effective CRM (CustomerRelationshipManagement) policy1.1 Meaning of Customer Relationship Management (CRM):CRM is acomprehensive strategy & process of acquiring & retaining customers to createsuperior value for thecompany as well as the customers. It consists of the processes acompany uses to track and organize itscontacts with its current and prospective customers.To support these processes, various CRM Softwarelike SAP, ORACLE Sales etc.are used. These software record and store information aboutcustomers, various customerinteractions, their problems etc which can be accessed by employees indifferent departmentsof the company. These information are used by the organization to make futureplans that cansatisfy the customer on a better way and retaining them for a longer period.1.2 Goal ofCRM:The goal of CRM is to provide improved services to the customers, and to use customercontactinformation for targeted marketing. 3
  2. 2. 4. 1.3 Evaluation and growth of the CRM:CRM passes through three generations such as 1st generationin 1990, 2nd generation in 1996and the 3rd generation in 2002.In 1st generation following systems wereapplied for CRM:- Call centre management-It is a web based CRM technology, the enables usersbrowsing a company’s web site to leavea phone number where company representative can call backwith more information. Customer service support-It is a part of a company’s CRM department thatinteracts with a customer for theirimmediate benefits. Sales force automation-It is software thatautomates business tasks like inventory control, sales processing, customerinteraction, etc-. Campaignmanagement-It is a planning, executing, tracking and analyzing of direct marketing campaigns.In 2ndgeneration following improved systems were used for CRM:- Integrated customer facing front end-It isface to face interaction between the customers and sales man. This system is used formarketing, salesand services. ERP integrations-ERP stands for Enterprise Resource Planning. It is a businessmanagement system thatintegrates all functions of the business. Customers analytics-It comprises allthe programming that analyzes data about an enterprise’s customers forbusiness decision. Completeweb integration-It allows end users to have access the data function of a serve hosted applicationthroughinternet browser window. 45. In 3rd generation the strategic CRM was followed and is continuing- Strategic CRM updates andexpands the original content and combines into one,convenient value that guides users through the entireCRM implementation process, fromstrategic planning software.Scope and goals of different generations:-There is successful increment in the scope of CRM from 1st generation to 3rdgeneration. In 1stgeneration the scope consists of service function and sales function, in 2ndgeneration it includes anotherfunction i.e. marketing function and in 3rd generation itincludes entire function of the organization. Goalsof the CRM have also changed with better customer service from 1st generationto 3 generation. In 1stgeneration the goals were improve service operation and increase rdsales efficiency, in 2nd generationreduce cost of interaction, improve customer experiences,and increasing the customer interaction; in 3rdgeneration cost reduction & revenue growthand competitive advantages. 56. 1.4 Options for Implementing CRM:Increasing customer is not the ultimate objective of anyorganization but to retain customerand t build long term relationship with them is important. It is onlythrough CRM that aprospect can be turn into customer and then finally into a client. But to achieve theseanyorganization require proper implementation.But at the same time CRM implementation is achallenging task because it ties together manypeople, process, technologies within the organization whichare separate from each other. 1) IN HOUSE DEVELOPMENT- This means all the strategies, processesare developed and implemented within the organization.Advantage- 1. It is tailored made according to
  3. 3. organization needs and structure thus is flexible as compared to others. 2. Avoid dependency on othersbe it software or outsourcing.Disadvantage 1. It is at the same time expensive 2. And comparatively takeslonger time depending on the organisation. 2) BUY LICENSED CRM SOFTWARE- This is purchasingsoftware and implementing in organization.Advantage- 1. Usually the maximum chance of success. 2. Itjust need to install and trained the workforce accordingly.Disadvantage- 1. Again it is expensive becauseof many costs as license cost, renewal cost etc. associated with it. 2. Adding new software with change isa complex task. 3) OUTSOURCING A MANAGED SERVICE- This means hiring from outside.Advantage-1. Most of the times lower cost. 2. Can adopt ―pay- as- you go‖ approach with visibleresult.Disadvantage- 1. For any new requirement needs to contact the company and pay for thedevelopment. 2. Also there is a risk of losing CRM solution investment if outsourcing company goes out ofbusiness 67. Implementing CRM: The Decision Process Stage-wise Purchase and install a implementation completeCRM solution from a vendor Decision To Implement an YES Implemen enterprise-wide t CRM CRMprogram Entirely outsource the CRM application process NO In house developmentSTAGEWISE- In thisCRM software is offered in different, independent modules, accordingto specific departmentneeds.Company buys sales automation software and contact management module fromdifferentproviders.ENTERPRISE WISE CRM SOLUTION- This is composed of different modulesfromsame providers; it is implemented as a whole by connecting different modules andexistingdatabase.1.5 VARIOUS ASPECTS OF CRMCRM includes many aspects which relate directly toone another: • Front office operations — Direct interaction with customers, e.g. face to face meetings,phone calls, e-mail, online services etc. • Back office operations — Operations that ultimately affect theactivities of the front office (e.g., billing, maintenance, planning, marketing, advertising, finance,manufacturing etc.) 78. CHAPTER 2 INTRODUCT RESEARCH ION METHODOLOGYResearch is a systematic and objectiveinvestigation of a subject or a problem in order todiscover relevant information or principles. Researchmethodology is basically the methodof how to collect data. The information regarding our research are asfollows:2.1 Objective of our research: We wanted to understand as well as compare the―customerrelationship management‖ followed by the Reliance Mart and Big Bazaar.2.2 Type ofresearch: Our research was empirical kind of research since we were dealingwith the behavioral orqualitative aspect of customers and not the quantitative data’s.herewe were not supported with anyexterenal data nor were adopting any secndory data to doour reaserch.2.3 Data collection and analysis:collection, and analysis of the information gathered byInteraction with employees and customers and also
  4. 4. by observing activities of theemployees. For better understanding of CRM in Big Bazaar and RelianceMart we also hadprepared a questionnaire for both customers and managers.2.4 Sampling procedure andsample size:persons selected by us were randomely selected.and were from different age group,sex andeducational backgroun .this diversification wasdone to measure the different choice and preferencesprevailing in customersdemographycally different.2.5 Limitations of our research: 1. Our sample size wascomposed of only 20 customers which is extremely small sample torepresent entire population ofcustomers who visit in these two retail stores.2. No demographical or psychographic differences wasconsidered before choosing thecustomers for interview purpose.3. many of the policies which were not inforce due to smaller market potential theirdescription is also been provided by managers. 89. CRM @ Big bazaar & Reliance Mart Customer’s Organization’spoint of view point of view 910. CHAPTER- 3 CRM POLICY OF RELIANCE MARTCRM policy of reliance mart can be divided intofour major parts, namely; 1) Customer loyalty 2) Customer retention 3) Customer communication 4)Customer gratificationThere exists a blanket customer relationship programme called the reliance onemembershipprogramme for the purpose of maintaining customer loyalty. The membership programme isavery simple one where a willing customer is required to fill a form giving personalinformation and he getsa temporary card which will be made permanent after six months.On each purchase of rs. 100 thecustomer gets one redeemable point on the production ofcard at billing counter. The collected points canbe redeemed in form of discounts on futurepurchases on demand of the customer.The customers also getthe opportunity of availing four different kinds of insurance on thepayment of a nominal fee. For examplea customer can get an accidental death insurance of rssix lakhs on the payment of rs. 400 only.Otherforms of insurances are disability, hospitalization and home insurances.The members of relianceone getthe opportunity of taking part and winning prizes by the wayof lucky draws on regular intervals.Customerretention policy implementation is at the zonal level. Generally each state isregarded as a zone and theoffers and discounts in a zone are not available in other zones.Such policy helps reliance retail tounderstand and capture the local markets better.The products which show improvement due to offers anddiscounts on them are repeated withthese offers again so as to retain the sales of the customers whobought it the last time.Also such the days best offers are constantly announced in the store making theregularcustomers aware about them.Maintaining a good store ambiance is also a part of customerretention policy of relianceretail. Clean and hygienic environment with properly and well spaced productsalong with auniform color theme attracts the existing customers to the store again and again.A fast billingsystem and good and easy grievance handling system which can be accessedthru customer service deskand company website, ensures that customers feel satisfied withthe store management. Less harassment
  5. 5. to customers means better customer retention.Communication to existing customers takes the form ofsms and e-mails, generally sent toreliance one members. They get information about ongoing offers andalso information andlatest news about their nearest stores and the company in general.Another source ofcustomer database is the information collected during the organizing ofspecial events in the stores.Customers participating in such events provide their contactinformation which are also used in form ofdatabase for communication purposes.Thank you and festive cards on special occasions are aninnovative way of communicatingwith the customers.Trained salespersons make customer gratificationvery easy. A simple thank you with a smilegoes a long way for the store to keep the customers happy. 1011. The special events organized by the stores across india are also a way to gratify the customersbyallowing them to play and win prizes.Gift vouchers and discount coupons are an attraction for thecustomers and give them the feelthat the store cares about them and their money.Local customers manya times make limited personal contacts with the store staff just likethat made at a kirana store and helpthe store to some extent to maintain a relationship withthe customers.The implementation of the policiesbrings out certain limitations in them. Few major ones areas followsThe personal contact numbers ofreliance one members are open to tele marketing calls fromvarious marketers as they leak out of thereliance retail’s database, causing unnecessaryharassment to customers.The customer communicationpolicy is less followed in small towns and cities and is moreconcentrated towards the metro cities.There isa common crm policy for both reliance fresh and mart. This should not be the case asboth the stores offerdifferent kinds of merchandize and generally attract different kinds ofcustomers.Reliance retail generallydelays the processing of permanent membership cards to thosecustomers who have not paid for such acard. Customers have been waiting for over threemonths for their card. Those who have paid the nominalfee of rs. 50 get their permanent cardwithin 15 days but the rest who have optioned not to pay the fees donot receive the card untiltoo late.Unmanned billing counters create long queues at the open counters.This creates impatiens inthe customers as they expect faster billing at the stores and do not want to standwith toomuch of goods held in their hands while billing. 1112. CHAPTER 4 CRM @ BIG BAZAAR Database is formed through the issue of future card and card isof three types silver card, gold card and sakthi card. Sakthi card is issued to ladies and this card provides,free sugar(1 kg) per month. Customer profitability analysis (CPA) is done on the basis of transactionsmade through the future cards. o Platinum customers (most profitable). o Gold customers (profitable). oIron customers (low profitability but desirable). o Lead customers (unprofitable and undesirable).Differentiate customers in terms of: (1) their needs and (2) their value to company. Interact withindividual customers to improve the knowledge about individual needs and to build stronger
  6. 6. relationships. There are four type of analysis done for analysis of CRM o Periodic Surveys: It’s done onquarterly, its an overall survey done by the future group authorities and CRM is a part of it. o CustomerLoss Rate : o Mystery Shoppers: They pose as normal customers perform specific tasks— such aspurchasing a product, asking questions, registering complaints or behaving in a certain way – and thenprovide detailed reports or feedback about their experiences o Monitor Competitive PerformanceComplaint Handling Procedures: Screening And Logging -- The type of product or service;manufacturer/brand name; model name/number; date of purchase/contract; warranty expiration date;salesperson; cost of product/service; date problem occurred; and a description of the problem is listed.This allows organization to exercise control, and assure proper follow-through. Investigating -- customersexplanation of a problem provides much information. Nevertheless, to assure they have all the informationneeded for a thorough review of the facts involved, by: o Researching in-house records on the customer;o Requesting receipts, or other records; o Inspecting the product, or service performed; and o Following-up with the customer for any necessary additional information. 1213. Acknowledging -- When Big Bazaar cannot resolve an issue immediately, it is important to letcustomer know that the matter is receiving attention. Customer is given information about how long it willtake to complete action on the complaint. If there is further delay, it’s made sure to advise customer whyand when Big Bazaar expects to have an answer. Formulating A Solution -- solution is made to beconsistent with established customer relations policy and important criteria are taken into account: oContractual and/or warranty obligations; o The customers expectations; o expectations of the customer; oThe cost/benefit of alternative solutions; o The probability and cost of customer seeking redress in someother way; o The comprehensiveness and fairness of solution; o ability to perform the solution; and oWhat to do if the customer rejects solution. Responding -- The response is made clear and appropriate.The customer must understand the response, and the response must address the issues raised in thecustomers original complaint. An explanation of decision preserves the goodwill of customer, even if thedecision itself is adverse. Following-Up – Customer is contacted following response to verify whether ornot the matter has been resolved satisfactorily. If customer is unhappy with response, organization refersthe matter to a third party dispute resolution mechanism for assistance. Steps Involved in customerSatisfaction through Service: o Seeing problems from the customer’s perspective o Managing customers"moments of truth" o Communicating effectively through better listening o Analyzing how customerperceptions are formed o Managing anger and other service behaviors o Dealing with long-termconsequences of service breakdowns o Negotiating solutions 13
  7. 7. 14. o Generating an action plan for improved on-the-job effectivenessCUSTOMERCOMMUNICATION:Future group maintains its records of customers by observing their purchasing habits&categories them into various groups like high revenue, moderate revenue & low revenuecustomers.They communicate to the customers through various medium like SMS,E-mail,Mobile vans, Print mediaetc.This is the way to built a strong presence in the existingcustomers & prospective customers. Presentlythey are using oracle software to maintaindatabase. Recently they have tied up with California based firmGREENPLUM to providenew software for data warehousing.The company boasts strong share of itsprofits from top line customers who provide themaround 70% of their revenues in total. The company cansaid to be going on the famousmanagement principle i.e. 80/20 PRINCIPLE which says that 20 percent ofvariables cause80% effect. In big bazaar it can be related to the fact that 20% of its top linecustomersprovide 80% of its revenues in a year. This is the reason why the retail giant is focusingstronglyon customer retention in order to boasts its sales numbers substantially.CUSTOMER GRATIFICATION isan important element of a sales process. Everycompany should survey their customers in order to find outthe satisfaction level among theconsumers. Big bazaar also conducts periodic surveys in order toascertain the satisfactionlevel in their consumers. Various activities are done in order to enhance theshoppingexperience among buyers & various offers, discount coupons; exchange offers are initiatedbythe firm in order to develop a good satisfaction level in their existing customers. Specialcoupons are givento customers who can be redeemed by the costumers in their futurepurchases from thestore.CUSTOMER PERCIEVED VALUE (CPV) is calculated by the retail store in order toasses the costsand benefits received & given to the buyers. The following are some keyfeatures of CPV1. CPV is thedifference between the prospective customer’s evaluation of all the benefits andall the costs of an offeringand the perceived alternative.2. Total customer value is the perceived monetary value of the bundle ofeconomic,functional & psychological benefits customers expect from a given market offering.3. Totalcustomer cost is the bundle of costs customers expect to incur in evaluating,obtaining, using, disposing ofthe given market offering, including monetary, time, energy &psychic costs. 1415. LOOPHOLES:The retail store has also various loopholes especially here at ranchi.The majordrawbackwhich was found out initially was lack of proper parking place but now it has been correctedtosome extent. Secondly the store is very slow in execution of online orders which is giventhrough companyweb portal ―FUTURE BAZAAR‖ . To quote a few examples of latedelivery Mr. David Kerketta,a residentof lalpur-peace road purchased a furniture for Rs37000,the date of scheduled delivery was 15th ofNovember,2008 but he received his order 37days late. One more incident of such late delivery is MRPradeep Kumar, a resident of UpperBazaar who purchased a dining table for Rs. 15000,but as usual he
  8. 8. got his final delivery awhopping 65 days late than the scheduled date of delivery. So these incidentsspeak a lot ofinefficient delivery. The other drawbacks are inefficient counters as they arenotupdated with the current offers and schemes. Also the billing counters remains unmanned thatadd tothe problem of customers who needs to stand in long queue in order to get theirpurchases billed. Theother problem is related to the slow processing of applications ofmembership cards like Shakti card,future cards etc.It takes around 30 days minimum tobecome a member of future card schemes. This isvery slowly considering the industryaverage of 15-20 days to process a card. Finally the contact numbersof customers are open tothe telemarketing personnel as they get the database from the future groupthrough somesources or the other. 1516. CHAPTER 5 INTRODUCT CUSTOMER’S POINT OF VIEW ION 1) Sales Person’s Assistance: Thisrefers to the extent of help an individual gets from the sales person present in the store in choosing aparticular product or in case of any query. There can be two instances i.e. inadequate help or excesshelp. Inadequate help is a very case because most of the time sales person is there to solve our queries.Instances of excess help can arise which makes the customer feel that the person is interfering in hisdecision or pushing the product to him.50% people preferred the sales person assistance of reliance martand only 35% preferred BigBazaar in this respect. 15% people were neutral that means they thought it tobe the same inboth the stores or they didn’t need any such help from the sales person. 2) ExpectationFulfilment: every customer has certain expectations when he visits a store. This expectation will vary fromperson to person. It can be getting a particular brand of product or particular quantity or variant of theproduct. 1617. 55% people felt that their expectations are more fulfilled at Big Bazaar while 45% preferred RelianceMart. This may be because of greater product depth at Big Bazaar than in Reliance Mart. 3) Discounts &Offers: these are announced from time to time to lure customers to buy more.60% people preferred theDiscounts & Offers of Big Bazaar while only 40% preferred that ofReliance Mart. This may be becausemore people are aware of the discounts offered by BigBazaar due to their huge advertisements. 4)Product Arrangement: this basically means the sequence or order in which different varieties, brands orsegments of products are arranged so that customers feel at ease in selecting the product of his/herchoice. 1718. 55% people preferred the product arrangement of Reliance Mart while 45% preferred that ofBigBazaar. This is because Big Bazaar has large space due to which products are morefragmented orscattered on the contrary Reliance Mart has smaller space in which productsare more logically arranged.
  9. 9. Also it has more space between the shelves which provide easeof walking to customers and they thinkless space means less energy wastage. 5) Accessibility: it refers to the reach of the store to thecustomers.50% people preferred Big Bazaar, 39% Reliance Mart & 11% were neutral thatmeansaccessibility doesn’t matter to them. Majority likes Big Bazaar because it is situated in themain citywhile Reliance Mart is located at a very posh area which is very far from the maincity. 6) Preference: itrefers to the preference of the customer regarding making a choice between the two stores i.e. BigBazaar & Reliance Mart. 1819. On the whole 65% people prefer shopping at Big Bazaar and 35% people preferred to doshopping atReliance Mart. This may be because of any of the above mentioned reasons. 1920. CHAPTER 6INTRODUCT ION 2021. CHAPTER 7 INTRODUCT ION CONCLUSION• Transformation by integrating customer facing front-end with back-end systems and partners and suppliers. This will effectively help in generating betterfiltered data source from feedbacks received. Also the feedbacks will be dealt with in a much more carefuland professional way.• Growth of CRM facilitated by growth of IT. In this age of Information Technologyan effective IT planning on the CRM can help the organization earn a lot of repute.• New databasesolutions. This will help to filter and clean the raw data received from feedbacks more efficiently.• Mutualbenefit through CRM. The stores and their customers can mutually benefit through the application ofCRM. So at this ―era of customers‖ , the companies should project themselves as customer oriented aspossible to help them benefit in a long term survival plan.• Effective segmentation of customers. Withmore and better quality of data, this can be done very easily.• Enhancing the shopping solutions. This isthe age of innovation. Especially in Indian markets, low cost innovation is the ultimate tool to win thebattle for the companies. Thus, the companies need to be innovative with their ideas and always try todeliver the customer with some added value for their purchase. 2122. RECOMMENDATIONSMany CRM project "failures" are also related to data quality and availability.Data cleaning isa major issue. If a companys CRM strategy is to track life-cycle revenues, costs,margins,and interactions between individual customers, this must be reflected in all businessprocesses.Data must be extracted from multiple sources (e.g., departmental/divisionaldatabases such as sales,manufacturing, supply chain, logistics, finance, service etc.), whichrequires an integrated, comprehensivesystem in place with well-defined structures and highdata quality. Data from other systems can betransferred to CRM systems using appropriateinterfaces.Because of the company-wide size and scope of
  10. 10. many CRM implementations, significantpre-planning is essential for smooth roll-out. This pre-planninginvolves a technicalevaluation of the data available and the technology employed in existing systems.Thisevaluation is critical to determine the level of effort needed to integrate this data.Equally critical is thehuman aspect of the implementation. A successful implementationrequires an understanding of theexpectations and needs of the stakeholders involved. Anexecutive sponsor should also be obtained toprovide high-level management representationof the CRM project.An effective tool for identifying technicaland human factors before beginning a CRM projectis a pre-implementation checklist. A checklist can helpensure any potential problems areidentified early in the process. 22