Renato Civili MBA Master Thesis - CRM, Customer Satisfaction and Loyalty in Albanian Telecommunication Industry

CUSTOMER RELATIONSHIP MANAGEMENT
CRM, Customer Satisfaction and
Loyalty in the Telecommunications
Industry in Albania.
By: Renato Civili, MSc

CRM, CUSTOMER SATISFACTION AND LOYALTY IN THE
TELECOMMUNICATION INDUSTRY IN ALBANIA
By
Renato Civili
Thesis Advisor : Eldi Metushi, Ph.D
A THESIS
Submitted to
SHLUP “Instituti Kanadez i Teknologjisë”
CANADIAN INSTITUTE OF TECHNOLOGY
Faculty of Economy
Department of Business Administration
In partial fulfillment of the requirements for the degree of: Master of Science in
Business Administration
Submitted on July 15, 2016.

1 CRM, Customer Satisfaction and Loyalty in the Telecommunications Industry in Albania
Master of Science in Business Administration, Profile in MBA International Business
Management.
Submitted on July 15, 2016.
Approved:
_________________________________________ Ph.D. Eldi Metushi
_________________________________________ Ph.D. Arjan Kadareja (Head of
Department of Business Administration)
I understand that my thesis will become part of the collection of Canadian Institute of
Technology. My signature below authorizes release of my thesis to any reader upon request. I
also affirm that the work represented in this thesis is my own work.
Renato Civili,

The Learning Relationship works like this: “If you’re my customer and I get you to talk to
me, and I remember what you tell me, then I get smarter and smarter about you. I know
something about you my competitors don’t know. So I can do things for you my competitors
can’t do, because they don’t know you as well as I do. Before long, you can get something from
me you can’t get anywhere else, for any price. At the very least, you’d have to start all over
somewhere else, but starting over is more costly than staying with me”.
- Don Peppers. Managing Customer Relationships. A Strategic Framework, 2004.
“We have only two sources of competitive advantage:
1. The ability to learn more about our customers faster than the competition.
2. The ability to turn that learning into action faster than the competition”.
- Jack Welch, former CEO, General Electric

Table of Contents
CHAPTER 1. INTRODUCTION ............................................................................................................ 7
1.1 Research Background ....................................................................................................................... 7
1.2 Problem Discussion........................................................................................................................... 7
1.3 Purpose of Study............................................................................................................................... 8
1.4 Research Questions........................................................................................................................... 9
CHAPTER 2. LITERATURE REVIEW .............................................................................................. 10
2.1 What Is Customer Relationship Management................................................................................. 10
2.2 Importance of Customer Relationship Management (CRM) .......................................................... 11
2.3 CRM as a Business Strategy ........................................................................................................... 12
2.4 CRM Benefits ................................................................................................................................. 12
2.5. Customer Relationship Management (CRM) and Marketing ........................................................ 13
2.6 Relationship Marketing................................................................................................................... 13
2.7 CRM as the Core of Relationship Marketing.................................................................................. 14
2.8 Customer Satisfaction ..................................................................................................................... 14
2.9 Internal Satisfaction ........................................................................................................................ 14
2.10 Measuring Customer Satisfaction and Loyalty............................................................................. 15
2.11 CRM in Albania............................................................................................................................ 17
CHAPTER 3. METHODOLOGY......................................................................................................... 19
3.1 Research Purpose............................................................................................................................ 19
3.2 Research Approach ......................................................................................................................... 19
3.3 Data Collection Method.................................................................................................................. 20
3.4 Data Analysis .................................................................................................................................. 20
3.5 Validity and Reliability ................................................................................................................... 20
CHAPTER 4. DATA ANALYSIS.......................................................................................................... 22
4.1 Telecommunication Industry Background...................................................................................... 22
4.2 Market Share Analysis.................................................................................................................... 22
4.2.1 Vodafone Albania .................................................................................................................... 24
4.2.2 Telekom Albania...................................................................................................................... 24
4.2.3 Eagle Mobile............................................................................................................................ 25
4.2.4 PLUS Communication ............................................................................................................. 25
4.3 The value added of CRM on these companies................................................................................ 25
4.4 CRM Performance Measurement.................................................................................................... 27
4.5 The Results of Data Analysis.......................................................................................................... 27
CHAPTER 5. CASE STUDY - Vodafone Albania............................................................................... 39
5.1 CRM Performance Measurements.................................................................................................. 39
5.2 CRM Business Strategy Analysis ................................................................................................... 39

5.3 Vodafone Strategy - Delivering Great Customer Experience......................................................... 40
CHAPTER 6. CUSTOMER BEHAVIOR ANALYSIS ....................................................................... 44
6.1 Introduction of the survey............................................................................................................... 44
6.2 Objectives of the Survey................................................................................................................. 45
6.3 Methodology................................................................................................................................... 46
6.3.1 Context and setting of the study............................................................................................... 46
6.3.2 Respondent profile ................................................................................................................... 47
6.3.3 Data collection instruments...................................................................................................... 47
6.4 Findings of the Survey.................................................................................................................... 48
6.4.1 Secondary findings................................................................................................................... 50
6.5 Implications of the results............................................................................................................... 51
6.6 Conclusions..................................................................................................................................... 51
CHAPTER 7. CONCLUSIONS AND RECOMMENDATIONS ....................................................... 53
7.1 The results of the research .............................................................................................................. 53
7.2 Recommendations........................................................................................................................... 56
7.3 Implications for Future Research.................................................................................................... 56
REFERENCES........................................................................................................................................ 58
Appendix I ............................................................................................................................................ 61
Appendix II ........................................................................................................................................... 65

List of Figures:
• Figure 1. “ The CRM process model (Roberts 2003) …………………….…………10
• Figure 2.“The relationship between Internal Satisfaction and Customer Satisfaction.
(Long and Khalafinezhad, 2012)………………………………………………….....14
• Figure 3. Net Promoter Score (Reichheld 2011)………………………………….....15
• Figure 4. Market Share (Akep Statistics 2016)…………………………………..….22
• Figure 5. "CRM Performance Measurement"…………………………………….…36
• Figure 6. Net Promoter Score of Vodafone (The Image inside Stores)…………......40
• Figure 7. The Image of Survey on Customer Behaviour Analysis………….…….....43
• Figure 8. The Reasons Why Customers are Leaving………………………………...47
List of Tables:
• Table 1. Market Share Analysis (Akep Statistics) ……………………………………23
• Table 2. Pie Chart of Market Share (Akep Statistics 2016)…………………………..24
• Table 3. CRM Initiation Stage………………………………………………………...28
• Table 4. CRM Acquisition Stage ……………………………………………………..29
• Table 5. CRM Regain Stage…………………………………………………………..30
• Table 6. CRM Maintenance…………………………………………………………...31
• Table 7. CRM Up-Selling & Cross-Selling…………………………………………...32
• Table 8. CRM Retain Stage…………………………………………………………...33
• Table 9. CRM Referrals Stage…..…………………………………………………….34
• Table 10. CRM Termination Stage……………………………………………………35
• Table 11. CRM Exit Stage…………………………………………………………….35
• Table 12. Customer Behavior Analysis……………………………………………….46
• Table 13. Age Group Pie Chart………………………………………………………..46
• Table 14. Customer Satisfaction Analysis…………………………………………….46
• Table 15. Customer loyalty Analysis………………………………………………….49
• Table 16. Promoter VS Detractors Analysis…………………………………………..49

Abstract
Telecommunication industry has become one of the fastest growing sectors in the economy of
Albania. Companies are competing to increase their market share, implementing innovative
technologies and developing new resources and capabilities to attract and keep customers with
customer relationship management (CRM) strategies.
The purpose of this thesis is to study the CRM performance, the effective strategies and
approaches that Albanian telecommunication companies are executing as well as to analyze
their effect on customer satisfaction and loyalty. It is interesting to see how the
telecommunication companies operate in Albania in terms of CRM and if there are differences
among the same industry. In addition, we chose the telecommunication companies because it is
interesting to analyze their performance in terms of CRM due also to the fact that their main
outcome is related to the management of customer relationship and the quality of the service
they offer to customers.
To reach this purpose, the thesis starts with research questions based on the topic and literature
review focused on business strategy analysis, performance measurements of CRM, and the
relationship between customer satisfaction, loyalty and recommendation. Using the theoretical
framework, a structured interview is chosen to collect data information about
telecommunication companies such as Vodafone Albania, Telekom Albania, Eagle Mobile and
Plus Communication. These companies were studied through case analysis and compared with
each other and to the theory. The purpose is to see how these companies perform in terms of
CRM and if there are differences in their CRM strategies that could shape their business
performances. A survey on customer behavior is analyzed and a case study is conducted on
Vodafone Albania, as the leading company in the telecommunications industry, related to
measuring the impact of their CRM strategies and effectiveness on their business performance,
customer satisfaction and loyalty.
Keywords: CRM in Albania, Customer Satisfaction, Customer Loyalty, Business Strategy,
Customer Experience, Telecommunication Industry

CHAPTER 1. INTRODUCTION
1.1 Research Background
The last two decades, telecommunication industry has become one of the fastest growing
sectors in the economy of Albania. This industry is also characterized by fierce competition
among four telecom mobile operators including: Vodafone, TELEKOM, Eagle Mobile and
PLUS Communication. During these years, these companies are competing to increase their
market share, executing innovative technologies, developing new resources and capabilities to
attract and keep customers with customer relationship management strategies.
Despite their competition, these companies have realized that for attaining success in such a
competitive environment they have to focus on maintaining positive relationships with
customers by implementing effective strategies which lead to customer satisfaction, customer
retention and loyalty.
The goal of CRM in telecommunication sector is to provide a comprehensive suite of software
applications as well as customer relationship strategies that has enabled these companies to
increase revenue, productivity and customer satisfaction by managing, synchronizing and
coordinating customer interactions across all touch points including: web, customer contact
centers, stores, social media and distribution channels.
The main objective of this study is to explore the CRM strategies and their importance in
assessing the companies’ performance and the kind of marketing relationship that Albanian
telecommunication companies are pursuing in today's rapidly changing and highly competitive
environment, and to study their effect on customer satisfaction and loyalty.
1.2 Problem Discussion
An understanding of how to manage effectively the relationships with customers has become an
important topic for both academicians and business managers in recent years. During these
years, telecommunication companies have developed new resources and capabilities and
bringing new innovative technologies to attract and keep customers satisfied and loyal. But,
despite their innovation, there are still:
 Customer complaints about the level of customer service
 Customers that are leaving due to poor customer relationship management
 No understanding of customer’s needs and requirements

Customer relationship management has become an important strategic approach toward
customers, determining the success of the companies. When talking about marketing today, this
issue has become a focal point determining the success of the companies. There is no marketing
activity without taking into account also the relationship between the company and customers.
The customer today is an important point and actually the one who determines the final success
of the company strategies. The most successful companies (Vodafone Albania with 48.8 of
Market share and Telekom Albania with 31.8 % of market share) have established effective
CRM strategies formulated by putting the customer at the heart of their business. Their CRM
effectiveness has helped their companies to acquire, grow and retain long-term customer
relationships and creating a sustainable competitive advantage in the market.
As we analyze their CRM strategies, we understand that one of the most important objectives of
CRM strategy is focusing on delivering high customer service to generate customer loyalty, as a
key driver of profitability. Creating customer loyalty is an integral part of all CRM activities of
marketing, sales and support department, and understanding customers' requirements is
fundamental on their business success. These companies have a comprehensive understanding
of what drives customer loyalty and how strong those drivers are.
1.3 Purpose of Study
The purpose of this thesis is to study the CRM performance, effective strategies and the
approaches that Albanian telecommunication companies are executing and to analyze their
effect on customer satisfaction and loyalty.
The main objectives of this study are:
1. To analyze the impact of CRM on customer satisfaction, loyalty and business
performance.
2. To find out the main CRM activities of marketing, sales and support department.
3. To investigate on CRM strategies and analyze their approaches on acquisition, retention
and customer development.
4. To measure the impact of customer service on customer satisfaction and loyalty.
5. To analyze the customer behavior and the relationship between customer satisfaction,
loyalty and recommendations.

The key reasons why I am focused on these 5 main objectives are as following:
First, I have focused on analyzing CRM strategies that companies are using and how those
differences could shape their business performances. Second, it is essential to have a
comprehensive understanding on what are their main CRM activities on marketing, sales and
support department to attract, keep and manage positive relationships with their customers.
Third, by investigating on their CRM business strategies and comparing those by putting
benchmarks, we understand the differences on CRM effectiveness and what are their
competitive advantages. Fourth, is important to analyze how customer behavior is affected
from the quality of customer service and the impact on their satisfaction and loyalty. Fifth,
based on the survey on customer behavior analysis, we are going to evaluate how building
positive customer relationships has a profound impact on consumer behavior.
1.4 Research Questions
This study represents a qualitative study focusing on questionnaire and interview with the main
actors in charge of CRM strategies: I have developed open questions (for the case study with
Vodafone) and structured questions. The structured questions on this questionnaire are based on
the article of Werner Reinartz, Manfred Krafft and Wayne D. Hoyer (2004) of American
Marketing Association. The open and structured questions are communicated and answered
from Business Sales Managers and Store Manager of these companies1
.
1
The Open and Structured Questions are shown in the Appendix 1 and 2.

CHAPTER 2. LITERATURE REVIEW
2.1 What Is Customer Relationship Management
Customer relationship management (CRM) is a philosophy that encompasses the strategies,
practices, and methodologies that an organization follows when interacting with its customers,
prospects and contacts. It is a corporate level strategy that focuses on creating and maintaining
effective relationships with customers to increase their satisfaction and loyalty with the
organization.
The objectives of CRM are to enhance profitability, income, and customer satisfaction.
Therefore, CRM is mainly a strategic business and process issue rather than a technical issue
(Dowling, 2002). In addition to that, CRM has been increasingly adopted as a core business
strategy and invested in heavily by corporations (Lindgreen, Palmer, Vanhamme, and Wouters,
2006; Rigby and Ledingham, 2004).
An understanding on how to effectively manage relationships with customers has become an
important topic for both academicians and business managers in the recent years. Many studies
are focused on components of CRM strategy, such as the link between satisfaction and business
performance (Kamakura et al. 2002), the link between customer loyalty and profitability
(Reinartz and Kumar 2000), customer profitability heterogeneity (Niraj, Gupta, and Narasimhan
2001), and customer loyalty programs (Verhoef 2003).
A strategic approach of CRM is focused upon the development of a customer-centric business
culture dedicated to winning and keeping customers by creating and delivering value better than
competitors (Buttle and Maklan 2015). With effective CRM strategies, companies can enhance
the customer’s overall experience. By realizing that customers have different economic value to
the company, they are subsequently adapting their customer offerings and communications
strategy accordingly. They have designed different customer relationships, moving away from
product - or brand-centric marketing towards a customer-centric approach (Arnett,
Badrinarayanan 2005).
CRM is a term frequently used in marketing. Building and managing of ongoing customer
relationships delivers the essence of the marketing concept (Morgan and Hunt 1994). However,
the term CRM can be considered both as a business marketing strategy and as an IT system or
application. Moreover, CRM is not a technology itself, but rather a holistic approach to a
company’s philosophy, focused on the customer strategy.

Some companies have implemented CRM processes to a greater degree than others. Therefore,
it is important to identify the types of CRM activities that companies can employ and to explore
how these relate to company performance and profitability (Roberts, K. et al. 2003).
2.2 Importance of Customer Relationship Management (CRM)
Customer relationship management is the strongest and the most efficient approach in creating
and maintaining relationships with customers. Moreover, customer relationship management is
not only a business activity but also encourages a strong personal bonding and long term
relationship of customers with companies. Development of this type of bonding drives the
business to new levels of success (Roberts, K. et al. 2003).
Based on the figure 1, we can analyze an CRM process model that explains the key activities: a)
Collecting customer data by having a comprehensive understanding on customer’s needs and
profile, b) Managing customer touch points by providing a positive customer experience and
ensuring it in all interactions with the company, c) Developing effective business and marketing
strategies to generate more customers, a strategic position in the market and segmenting its
targeted customers to design effective marketing campaigns by improving their value
proposition, as well as develop the right strategy on products, prices, distribution and promotion
channels, d) Developing the marketing programs that attract and maintain long term customer
relationships by generating more ROI, and e) Measuring success as well as evaluating the
customer feedback and the results of the process.
Successful companies are using these CRM activities to improve their business strategies,
developing new ways of relationship that boost customer engagement, satisfaction and loyalty.

2.3 CRM as a Business Strategy
Customer relationship management has rapidly become one of the leading competitive business
strategies in the new millennium. This is why CRM is used as an integral part of the business
strategy, as a tool that facilitate achievement of company’s objectives and generate more
satisfied and loyal customers, design personalized offering based on customers’ stated and
unstated needs and wants.
Successful companies are formulating and implementing customer driven CRM strategies
focusing on improving customer relationships. The strategies are based on: (1) information
technology that is used to uncover insights regarding customer needs, and (2) special programs
designed to meet the discovered needs (Dowling 2002). By treating customers as individuals
will result into higher profits for the company and better customer satisfaction. In this way,
business can earn customer loyalty and generate a buzz through referrals that will further
contribute to customer acquisition. In addition, effective CRM strategies are focusing on
segmenting customers based on needs and profitability as well as designing and implementing
programs to effectively allocate the appropriate resources to each customer (Srivastava,
Shervanie, and Fahey, 1999).
With regard to marketing, the objective of CRM is to evolve from a marketing oriented model
based on a product-centric, to one that deals with each customer individually (Arnett,
Badrinarayanan, 2005)
2.4 CRM Benefits
There are many benefits of Customer Relationship Management (CRM). Appropriate resource
allocation enables benefits to flow to both the firm and its customers (Ramsey 2003). CRM
programs can be either database-driven or customer-needs–driven (Zablah, Bellenger, and
Johnston 2004).
In addition to that, businesses benefit also from the linking of sales, marketing, support as well
as managerial activities in one interrelated system, which would considerably reduce the
amount of manual labor and manual processes. Apart from this, CRM solutions also add value
by business intelligence and data mining of the customer database.

2.5. Customer Relationship Management (CRM) and Marketing
Organizations are increasingly being customer-centric and are embracing customer driven
initiatives that seek to understand, attract, retain and build intimate long-term relationship with
profitable customers (Kotler, 2006).
With CRM, companies are more effective formulating marketing strategies that reach the right
customer with the right message at the right time using the right medium. This is why CRM
leverages and amplifies customer base of an organization. By using an effective CRM software,
one that enables an organization to easily gather critical sales and marketing information, it
becomes a valuable resource for improving productivity as well as performance. CRM enables
that anyone who touches a customer shares the same information and that information should be
easy to access by others. (Long and Khalafinezhad 2012).
Finally, CRM has brought up new dimensions in the field of marketing by significantly
improving marketing approaches, strategies and new ways of interacting with customers.
During the recent years, CRM is an important part of each company that facilitate core activities
to enhance productivity, sales and marketing effectiveness.
2.6 Relationship Marketing
In the literature review concerning relationship marketing, there are some definitions by some
scholars. One definition is by Berry (1986) that says "Relationship marketing is the attraction,
maintaining and enhancing customer relationships. The marketing mindset is that the attraction
of new customers is merely the first step in the marketing process".
Another important definition is by Gronroos (1994) that thinks: “Relationship marketing is to
identify and establish, maintain and enhance relationships with customers and other
stakeholders, at a profit, so that the objectives of all parties are met; and that this is done by
mutual exchange and fulfillment of promises". Moreover, the relationship marketing is an
approach that leads to a trusting rapport between the parties involved in business. He thinks that
it is not only important to get customers and create transactions, but also to maintain and
enhance ongoing relationships, in order to achieve a sustainable growth.
Studying the relationship marketing from another prespective, it involves two important
elements: (1) to identify customers who warrant the formation of close relationships, and (2)

develop and maintain good relationships with them (Lambe, Spekman, and Hunt 2002). In
addition to that, is an organizational strength to have the competence of building relationship
marketing effectively. Is an important organizational ability for identifying, developing, and
managing relationships with key customers successfully. Therefore, it represents an important
source of sustainable competitive advantage.
2.7 CRM as the Core of Relationship Marketing
Relationship marketing is being spoken of as one key business philosophies of the progressive
organizations who are customer oriented or customer centric. Companies have realized that to
be successful on the long term, they need to be closer to the market’s needs, get under the skin
of the customer, anticipate his needs and engineer products and services to satisfy the customer
and nurture his loyalty.
An effective CRM enables these companies to adapt to the needs of different customers
generating more customer satisfaction and loyalty. This is the core of relationship marketing, to
create personalized products for their customers and be able to sell more in the market.
2.8 Customer Satisfaction
Customer satisfaction, as a construct, has been fundamental to marketing for over three decades.
During these years, not only the organizations aim to satisfy the customers but they attempt to
do this more efficiently and effectively that the other rivals in competitive market place to attain
their goals (Kotler and Armstrong, 2011). The most important goal that companies follow up is
to maintain customer loyal to the firm so they dedicate more focus on customer centric
approach in their organizational and marketing strategies.
It is essential to put the customers at the center of the business and aligning the strategies,
activities and processes as an integral part of satisfying its needs and requirements. Moreover, it
is easier and more profitable to sell to presented customers than to find new ones. This is why
organizations are designing better strategies with CRM solutions to become more customer-
focused and service-oriented to increase their satisfaction and loyalty.
2.9 Internal Satisfaction
Many studies have shown the importance and the link of internal (employee) satisfaction to the
external (customer) satisfaction. It is evident that there is a positive relationship between
employee satisfaction and customer satisfaction.

The Figure 2 describes the customer satisfaction and loyalty as dependent variables based on the
employee’s behavior. The figure shows that independent variables as: behavior of the
employees against customer, quality of customer services, the kind of relationship with the
customers, and how customer relationships are managed are the causes that effect customer
satisfaction and loyalty. Based on this analysis, we understand that first, is very important is to
manage, lead and empower the employees by creating the right work environment, capabilities
and systems in order to equip them with the right tools to manage effectively customer
relationships and to deliver a positive customer experience consistently.
Figure 2. The relationship between Internal Satisfaction and Customer Satisfaction. (Long and
Khalafinezhad, 2012)
2.10 Measuring Customer Satisfaction and Loyalty
Over the years, companies have developed many different methods for analyzing the attitudes
and behaviors of their customers. They have attempt to gather data that companies can use to
develop further customer relationship, improve customer satisfaction and loyalty. During the
last years, one of the most used methods that is useful and practical for companies is “The Net
Promoter Score”.

Based on the book "The Ultimate Question" by Reichheld (2011), companies should ask their
customers the ultimate question, such as: “What is the likelihood that you would recommend
our company to a friend or colleague? This essential question allows the company to track
promoters and detractors, producing a clear measure of an organization's performance through
its customers' eyes.
“Net Promoter Score” (Reichheld 2011) is based on the fundamental perspective that the
customers can be divided into three categories. First, are "The Promoters" those that are loyal
enthusiasts who keep buying from a company and urge their friends to do the same. Second, are
"The Passives" those that are satisfied but unenthusiastic customers who can be easily attracted
by the competition. Third, are "The Detractors" those that are unhappy customers trapped in a
bad relationship. Based on this, customers can be categorized in three groups by companies,
based on their answer to the ultimate question, and each group is characterized by different
attitudes, behaviors and, therefore, economic value.
Figure 3. Net Promoter Score by Reichheld (2011).
Promoters (customers that score 9 or 10). Promoters are loyal, enthusiastic fans. They sing the
company’s praises to friends and colleagues. They are far more likely than others to remain
loyal customers and to increase their purchases over time. Moreover, they account for more than
80 percent of referrals in most businesses. They are, in general, pleasant for employees to deal
with.
Passives (customers that score 7 or 8). This group is called "passively satisfied" because this
group is satisfied, but for now. Their repurchase and referral rates are as much as 50 percent
lower than those of promoters. Their referrals are qualified and less enthusiastic.
Detractors (customers that score 0 to 6). Detractors are unhappy customers. They account for
more than 80 percent of negative word-of-mouth. They have high rates of churn and defection.
Some may appear profitable from an accounting standpoint, but their criticisms and bad

attitudes diminish a company’s reputation, discourage new customers and demotivate
employees.
Finally, the Net Promoter Score measurement is simply the total percentage of promoters minus
the total percentage of detractors. Companies are using it to focus on the twin goals of creating
more promoters and fewer detractors, by managing effectively customer relationships,
improving satisfaction and delivering positive customer experience.
2.11 CRM in Albania
Albanian companies operating in telecommunications, banking and tourism have begun
implementing the CRM management systems, thus following the world trends. I refer to some
studies that are conducted in Albania, to describe their results on what the impact of CRM is on
this sector.
Analyzing Hysi et al., (2015) study, which represents an interesting study focused previously on
the telecommunications industry with the topic it pays attention on specific issues from the
experience of their company that has implemented on its structures the SAP CRM program. The
study concludes some positive results from the CRM implementation. The company has
increased the efficiency by reducing service costs, reducing staff cost, minimizing the margin of
error as a result of increasing the accuracy of transactions, reducing the time, and with the
automation system quality service is increased. First, it has allowed the company to be more
transparent to subscribers and enable handling of complaints accurately and to prevent
recurrence of bad experiences. Second, by using it, the company already has a detailed and
updated client database. Third, it has enabled the company to analyze consumer behavior
periodically and as a result, it is likely to achieve up sell and cross sell. Finally, it helps to
design effective marketing campaigns in defining target groups and create new packages of
services.
Another study by Ramaj (2015) is focused on the banking sector to understand that even in the
banking sector there are many benefits from CRM. Based on the results of this study, CRM
implementation is adding value to the marketing department, sales department, e-commerce,
center operations and management as well as to the employees. The study concludes that the
implementation and operation of a CRM system by the Banks is particularly important. Through
this, both management as well as cooperation between the departments of the bank were
facilitated to better serve the customers through the effective registration of their characteristics
and needs. The use of a CRM system contributes significantly to increasing the degree of

customer satisfaction by the Bank. The most important conclusion, however, has to do with the
specific characteristics that a CRM system is good to have in order to achieve the objectives.
Analytical CRM is a tool that helps banks organizing their customer data in order to feed the
marketing for new product design and analysis (and not only for existing customers) with
statistical methods such as segmentation and cluster analysis.
Regarding the tourism industry, there are two other interesting studies by Kalaj and Lacej
(2014) and Taga and Gaspari (2011). Findings of these studies have a significant implication for
the managers of Tour Operators in Albania. This study helps managers of Tour Operators in
Albania understand the CRM dimensions that positively affect customer satisfaction and
customer loyalty. Effective CRM is defined as a function of five dimensions, namely as:
organizational commitment, customer experience, process-driven approach, reliability and
technology orientation.
The findings of these studies show that an effective customer relationship management
positively affect customer response behaviors, customer satisfaction and customer loyalty. On
the other hand, it also shows that customer satisfaction operates as a strong positive mediator
between CRM and customer loyalty.
Finally, even the results of these studies are based on the objective that it is not effective just to
implement technology-based CRM solutions but to also establish the necessary technological
(data-warehouses and customer intelligence systems), organizational (data integration, inter-
departmental communication, links with distributors and resellers) and cultural (customer-
centered service provision) change within companies that would allow CRM strategies to
contribute to productivity and profitability.

CHAPTER 3. METHODOLOGY
3.1 Research Purpose
The purpose of this thesis is to study the CRM, the effective strategies and approaches that
Albanian telecommunication companies are executing and to analyze their effect on customer
satisfaction and loyalty.
To reach this purpose the thesis starts with research questions based on the topic and literature
review focused on: business strategy analysis, performance measurements of CRM, and the
relationship between customer satisfaction, loyalty and recommendation. Using the theory about
these questions, a structured interview for B2B and B2C departments is chosen to collect data
information about telecommunication companies such as Vodafone Albania, Telekom Albania,
Eagle Mobile and Plus Communication. We also use the questionnaire developed in the study
of Reinartz et al., (2004) to determine the CRM strategies of the telecommunication companies
in Albania. A survey on customer behavior is analyzed and a case study is conducted on
Vodafone Albania, as the leading company in the telecommunications industry, related to
3.2 Research Approach
This thesis will go through three main stages of research. Firstly, the thesis is focused on
describing the area of research to try to create a comprehensive understanding of the area and
the importance of the topic of customer relationship management. This is the basis for
descriptive research (Yin, 2003) (Polit D. et al. 2004).
Secondly, the research is focused on literature review and on how customer relationship
management adds value to companies. There are discussed different studies that explore
concepts, strategies and the impact that CRM effectiveness has on business performance,
Thirdly, it has moved from theory to data, analyzing the collected qualitative information
through a structured questioner and open questions directed to Business Sales Managers as
well as Store Managers of the four telecommunication companies. The structured questions in
this questioner are based on the article of American Marketing Association: The Customer
Relationship Management Process: Its Measurement and Impact on Performance by Reinartz

et al., (2004)2
. In this study, the authors conceptualize a construct of the CRM process and its
dimensions, operationalize and validate the construct, and empirically investigate the
organizational performance consequences of implementing CRM processes. The first key
outcome of this study was a theoretically sound of CRM process and performance
measurement that outlines three key stages: initiation, maintenance, and termination. The
second key result was that CRM effectiveness has a moderately positive association with both
perceptual and objective company performance. Their findings indicate that the
implementation of CRM processes is associated with better company performance. Finally,
this study had the result that the strongest effect on company performance is the quality of
relationship maintenance that shows the importance of focusing on nurturing relationships
with customers.
3.3 Data Collection Method
As this thesis is aimed at studying the impact of CRM on customer satisfaction and loyalty as
well the positive correlation that those factors have with business performance. The selection of
data sources is made on the four telecom companies: Vodafone Albania, Telekom Albania,
Eagle Mobile and Plus Communication. A survey on customer behavior analysis is used to
understand the connection between a positive customer relationship and purchasing behavior on
this sector. Finally, a case study is conducted on Vodafone Albania as the leading company, on
3.4 Data Analysis
Based on the answers of the interview questions and external resources (AKEP statistics of
2016), the analysis of the collected data consists on examining, categorizing and comparing
them with other companies to measure their performance. The data analysis is focused on
findings on CRM business strategy, measuring the CRM effectiveness and the relationship
between customer satisfaction, loyalty and recommendation based on their customer
experience.
3.5 Validity and Reliability
Validity is an important aspect of every research paper. In order to deal with this, a case study
type of research is preferred, as it is more likely that the findings are valid if they are from
2
Questions of the article are shown in the Appendix

multiple sources (Yin. 2003).
This research study is based on the literature review and on theories that are primarily from
scholarly journals and books of renowned authors. Many different authors’ views on theories
of customer relationship management have been collected as well as theories which reflect the
general view on the impact of CRM on companies.

CHAPTER 4. DATA ANALYSIS
4.1 Telecommunication Industry Background
The purpose of this thesis is not just to analyze the techniques of customer relationship
management (CRM) in Albanian telecommunications industry. The main goal of this thesis is
to provide an understanding of the essence of customer strategy as a necessary and important
element of managing a successful company.
The telecommunications industry is characterized by fierce competition among four telecom
mobile operators including: Vodafone, TELEKOM, Eagle Mobile and PLUS Communication.
During these years, these companies are competing to increase their market share, executing
innovative technologies, developing new resources and capabilities to attract and keep
customers with customer relationship management strategies.
Despite their competition, these companies have realized that for attaining success in such a
competitive environment they have to focus on maintaining positive relationship with
customers implementing effective strategies that lead to customer satisfaction, retention and
loyalty.
The goal of CRM in the telecom sector is to provide a comprehensive suite of software
applications as well as customer relationship strategies that has enabled these companies to
increase revenue, productivity and customer satisfaction by managing, synchronizing and
coordinating customer interactions across all touch points including web, customer contact
centers, stores, and distribution channels.
4.2 Market Share Analysis
Based on the statistics of 2016 on the Electronic and Postal Communications Authority
(AKEP) 3
, we can make business performance’s analysis as below.
3
http://akep.al/lajme/466-publikohen-treguesit-statistikore-te-tregut-te-komunikimeve-elektronike-per-tre-
mujorin-e-pare-te-vitit-2016

Table 1. Market Share Analysis (Akep Statistics 2016)
By analyzing the AKEP’s statistics, we understand that for the last three years Vodafone
Albania is leading the telecommunication industry, with the highest market share of 48.8%
(1,680,870 number of active customers), followed by Telekom Albania that has reached 31.8%
of market share (1,055,073 number of active customers). During the last three years, Vodafone
has further increased its market share, compared to 2014, respectively by 0.3 % in 2015 and by
1.7 %, in 2016. On the other hand, even Telekom has increased further its market share.
Compared with 2014, it had a higher increase in 2015, respectively by 1.5%. In contrast with
their increase in 2015, in 2016 we see that it has a slight decrease by 0.1 % on market share.
The third company is Eagle Mobile, that has 14.0% market share (465,326 number of active
customers). If we would refer to the last three years, even Eagle Mobile has a slight decrease
on their market share by 0.2%. Plus Communication has the smallest market share, 5.3%
(175,004 number of active customers). The trend that is more evident in these three years is
that Plus Communication has the highest decrease on market share by 3%.
Figure 3. Market Share (AKEP Statistics 2016)
Years Telekom Vodafone EAGLE Plus
2016
31.8%
1,055,073
48.8%
(1,680,870)
14.0%
( 465,326 )
5.3%
( 175,004 )
2015 31.9% 47.4% 14.2% 6.5%
2014 30.4% 47.1% 14.2% 8.3%

4.2.1 Vodafone Albania
Vodafone is leading the telecommunication industry, with the highest market share of 48.8%
(1,680,870 active customers). It is part of Vodafone Group Plc – a global telecommunications
leader, and is present in more than 30 countries and a partner with other networks in over 40
countries4
. They have built their success by following the successful patterns and experience of
Vodafone networks all over the world. Based on their global expertise, they have developed
the right resources and capabilities to effectively implement the technologies and CRM
strategies and leading in this sector during the last years. Vodafone was introduced in the
Albanian market in August 2001.
Table 2. Pie Chart of Market Share Analysis (Akep Statistics 2016)
4.2.2 Telekom Albania
Telekom Albania is the second company that has a market share of 31.8% (1,055,073 active
customers). Even Telekom is a leading European telecommunications provider5
. It has an
international expertise of formulating and executing effective CRM strategies for achieving
high performance in the market. Telekom Albania was introduced to the Albanian customers in
July 2015, after the acquisition of AMC company. AMC (now Telekom Albania) was
established in May 1996, and was the first mobile telecommunications company to operate in
Albania.
4
www.Vodafone.al
5
www.telecom.com

4.2.3 Eagle Mobile
Eagle Mobile is the third company that has a market share of 14.0% (465,326 active
customers). Eagle Mobile is part of the ALBtelecom Company, which is the largest telephony
network operator in Albania. The merger of Eagle Mobile with ALBtelecom assists the
customers who want to have all the services and products of the telephony, mobile and internet
incorporated. The merger of the companies has facilitated the differences between fixed and
mobile technology, in accordance with the customers’ needs, transforming in this way
communication in a service accessible to all. The merging process of ALBtelecom and Eagle
Mobile began in March 2011 6
. Eagle Mobile was founded in March 2008.
4.2.4 PLUS Communication
PLUS Communication has the smallest market share of 5.3% (175,004 active customers) . It
was born as an initiative of a group of successful Albanian businessmen with the aim to create
one of the biggest investments in the country7
. The company’s philosophy is based on the
strong Albanian values and traditions, combined with the corporate principles, work culture
and the latest technology. Compared with other companies that have international expertise,
PLUS has not built yet the resources and capabilities to be prepared to successfully compete
and increase its market share.
4.3 The value added of CRM on these companies
By implementing CRM, these companies have increased the efficiency by reducing service
costs, reducing staff cost, minimizing the margin of error as a result of increasing the accuracy
of transactions, reducing the time, and increasing the automation system quality service (Hysi
et al., 2015).
The CRM is adding value by improving productivity, effectiveness and developing long term
customer relationships. Companies now have more customer knowledge, are more transparent
to subscribers and manage complaints more accurately as well as prevent recurrence of bad
experiences. CRM maintains subscriber’s records with all the historical events occurred,
payment history to identify whether a client is a regular payer or delayed one and history of
complaints to see if there have been reported service problems. In addition to that, companies
have established detailed and updated customer databases, designing effective marketing
strategies to analyze the consumer behavior periodically and, as a result, to achieve up sell and
6
www.eagle.al
7
www.plus.al

cross sell. It provides categorization of customers based on services they receive and use these
categorizations in its efforts to sell them a better package.
CRM is adding value to marketing, sales and support departments by facilitating and providing
important activities for these companies. CRM ensures a unique customer experience by
organizing activities around the customers’ needs and their unique profile. The activities that
these companies are using in their departments are as following:
1) In Marketing Department
 Market knowledge and needs analysis
 Segmentation and targeting
 Marketing campaigns
 Lead generation activities
 Marketing feedback analytics
 Relationship marketing
 Brand management
 Customer experience management
2) In Sales Department
 Acquisition, retaining and customer management strategies
 Customer care management
 Need analysis of core customers
 Leads management
 Generating new potential customers
 Sales forecasting, reporting and analysis
3) In Support Management
 Providing better customer care
 Service contact management
 Personalized customer service for core customers
 Support and dedicated call center

4.4 CRM Performance Measurement
After conducting the interview with open and structured questions, I made the analysis based
on the answers from Business Sales Managers and Store Managers of these companies.
The tables below represent the questions with their scores respectively, rated on a seven-point
scale, (anchored by 1 "strongly disagree" and 7 = "strongly agree").
The questions are categorized in nine key stages of CRM, mentioned below:
1) Initiation,
2) Acquisition
3) Regain
4) Maintenance
5) Up-Selling and Cross-Selling
6) Retention
7) Referrals
8) Termination, and
9) Exit
4.5 The Results of Data Analysis
Following are the results of the structured questionnaire, which would help us to measure their
CRM performance and the impact on the customer satisfaction, loyalty and productivity.
Investigating on their CRM activities and comparing these by putting benchmarks, we
understand the differences of CRM effectiveness and their competitive advantages.
1. Initiating Stage Analysis
This is the first phase that CRM system enables to identify and follow potential customers.
Regarding the first and second questions, Vodafone and Telekom have established advanced
systems for finding and targeting new potential customers and categorizing them based on their
value. They use data from their personal network, as well as have larger external sources,
contacts and business networks that facilitate them identifying potential high value customers.
These two companies have highest score (both 7) and competitive advantages compared with
their competitors, even because they have more years operating in the market (Telekom was

established in 1996, Vodafone was founded in 2001). Compared with them, Eagle and Plus
have started about 10 years later to operate in the market (Eagle started in 2011), and it has
been challenging for them to enter and compete with these giant companies for market share.
Both have scored 5, based on their limited opportunities for identifying potential customers
from external resources, as well as for their systems.
Regarding other questions on Initiation stage, Vodafone is operating with Sales Force
software, one of the most effective CRM for managing new leads, potential clients and
contacts that facilitates their continuous evaluation of prospects. Even Telekom Albania has
the same system and CRM solutions that allows them to assess the value of new potential
customers, as well as past customers with whom they no longer have a relationship.
Comparing with Eagle Mobile and Plus Communication that have higher advantages based on
these effective tools that facilitate their processes on finding, following and generating more
potential high value customers. Their total score in this stage are respectively 49 (Vodafone),
46 (Telekom), 29 (Eagle) and 26 (Plus)
Table 3. CRM Initiation Stage
2. Activities on Acquiring Customers
The second stage is the measurement of CRM activities for acquiring new customers, which
enables them to increase the customer portfolio and to add value to their company. Regarding
CRM – Measurement at Initiating Stage Vodafone Telekom Eagle Plus
We have a formal system for identifying potential
customers.
7 7 5 5
We have a formal system for identifying who of the
potential customer are more valuable.
7 7 5 4
We use data from external sources or identifying
potential high value customers.
7 7 3 3
We have a formal system in place that facilitates the
continuous evaluation of prospects.
7 7 5 4
We have a system in place to determine the cost of
reestablishing relationship with a lost customer.
6 6 5 4
We have a systematic process for assessing the value
of past customers with whom we no longer have a
relationship.
6 6 3 3
We have a system for determining the costs of
reestablishing the relationship with inactive
customers.
6 6 3 3
TOTAL 49 46 29 26

the first and second questions, Vodafone (7) as well as Telekom (7) have standard systems to
attract prospects and coordinate messages across media channels through email, newsletters,
social media, advertising, face to face with relationship marketing as well as many stores by
covering most of the cities of Albania and reaching more customers comparing with Eagle and
Plus. They have an advanced CRM system that differentiates potential customers based on
their value. On the other hand, even Eagle and Plus have the standard systems to attract
prospects and coordinate messages across media channels and categorize them based on their
economic value, but their do not have the same tools as well as resources to execute them at
the same level. Their scores are respectively 6 (Eagle) and 5 (Plus).
Regarding other questions, Vodafone and Telekom, based on their higher experience, are better
able to systematically present different offers to prospects based on their economic value as
well as differentiate their acquisition investments. Both their scores are 7. On the other hand,
Eagle and Plus have not reached the same expertize, resources as well as systems that would
enable them to categorize and differentiate their potential customers. They scores are
respectively 5.5 (Eagle) and 4 (Plus). Their total score in this stage are 28 for both Vodafone
and Telekom, followed by Eagle with 23 and Plus 18.
Table 4. CRM Acquisition Stage
3. Activities to Regain Customers
By analyzing their activities on regaining customers, these companies have different
performances regarding their approach to reestablish relationships with their customers who
have been lost to competitors (or are inactive). Vodafone (7) has established a systematic
process that is operated by a call center department that is focused on these category of
CRM – Activities to Acquire Customers Vodafone Telekom Eagle Plus
We made attempts to attract prospects in order to
coordinate messages across media channels.
7 7 6 5
We have a formal system in place that differentiate
targeting of our communication based on the
prospect's value.
7 7 6 5
We systematically present different offers to
prospects based on the prospects economic value.
7 7 5 4
We differentiate our acquisition investments based on
customer value.
7 7 6 4
TOTAL 28 28 23 18

customers, by identifying, contacting and following up as well as by prioritizing them based on
their value. Compared with Vodafone, even Telekom (6) has a system in place that enables
them to interact with lost customers, as well as key account managers that are following up
their inactive customers daily to reestablish the relationships with them. But, after the
acquisition of AMC, Telekom is more in a study phase. It’s focused more on studying the
Albanian market as a new business environment for them. They are conducting market
analysis, customer behavior analysis and based on that they will be more proactive on these
activities. Telekom’s score is 6.5.
In addition to that, even Eagle and Plus have developed systems for following and interacting
with their inactive customers, but their solutions and offers are not at the same level with
Vodafone and Telekom. They are trying to reestablish the relationships with lost (or inactive)
customers but their offers and resources have not reached the same performance. Their score is
respectively 5 (Eagle) and 4.5 (Plus). Their total score in this stage are 28 for Vodafone,
followed by Telekom with 26, then is Eagle with 20 and Plus 18.
Table 5. CRM Regain Stage
4. CRM Customer Maintenance
Managing effectively the existing customers is one of the main competitive advantages of
Vodafone and Telekom, compared with Eagle and Plus. They are focusing on providing
solutions and quality customer service to boost customer satisfaction and loyalty for all
customers. Regarding the first two questions, Vodafone and Telekom have a advanced system
CRM – Activities to Regain Customers Vodafone Telekom Eagle Plus
We have a systematic process / approach to
reestablish relationships with valuable customers
who have been lost to competitors.
7 6 5 5
We have a system in place to be able to interact with
lost customers.
7 6 6 5
We have a systematic process for reestablishing a
relationship with valued inactive customers.
7 7 5 4
We develop a system for interacting with inactive
customers.
7 7 4 4
TOTAL 28 26 20 18

for determining which of their current customers are of the highest value and continuously
track customers in order to assess their value. They both have scored (7). On the other have,
different scores are from Eagle and Plus. Eagle and Plus have not the same system for
determining which of our current customers are of the highest value, and this is not enabling
their employees to track customer information in order to assess customer value. Their scores
are respectively 4.5 (Eagle) and 4 (Plus)
Regarding the last two questions, Vodafone and Telekom has again higher performace on
tracking the customer satisfaction status during the entire customer life cycle (relationship
maturity). They have a formal system that enables them to determine which of their current
customers has the highest value, as well as build positive customer relationships with all
categories. They continuously track customer purchasing behavior and based on this analysis
they deliver personalized offers and services. They both scored 7. In contrast with them, Eagle
and Plus have systems that allow them to track the status of the relationship during the entire
customer life cycle as well as determine the cost of retaining customers, but their tools and
resources have not reached the same performance compared with their competitors. Their
scores are respectively 5 (Eagle) and 4 (Plus). Their total score in this stage are 28 for both
Vodafone and Telekom, followed by Eagle with 18 and Plus 16.
Table 6. CRM Maintenance
5. Activities to Manage Up-Selling and Cross-Selling
By comparing the activities on managing up-selling and cross-selling, we see different
approaches of their customer development strategies. Regarding the first three questions,
CRM – Maintenance Vodafone Telekom Eagle Plus
We have a formal system for determining which of
our current customers are of the highest value.
7 7 4 4
We continuously track customer in formation in order
to assess customer value.
7 7 5 4
We actively attempt to determine the costs of
retaining customers.
7 7 4 4
We track the status of the relationship during the
entire customer life cycle (relationship maturity)
7 7 5 4
TOTAL 28 28 18 16

Vodafone and Telekom have achieved advanced procedures of up-selling and cross-selling to
valuable customers. They systematically tend their "share of customer" with high-value
customers. They both scored 7. In addition, Eagle has implemented these customer
development strategies by providing more services for their customers (internet, TV channels
and telephone lines) after the merge with Albtelecom. Their score is 6. Plus company is
following these approaches but with a different (lower) performance. Their score is 4.
Comparing the last two questions, Vodafone and Telekom has the again the same performance.
They have established effective approaches to build mature relationships with their high value
customers. They are providing individualized incentives in order to further develop their
customer value as well as intensify their business relationships. They both have scored 7. In
contrast with them, Eagle are trying to build relationships with high value customers as well as
providing individualized incentives, but there are not reaching the same level with its
competitors. Even Plus is still behind on this point and is challenging for them to attract these
category of high-value customers. Their total score in this stage are 35 for both Vodafone and
Telekom, followed by Eagle with 27 and Plus 20.
Table 7. CRM Up-Selling & Cross-Selling
CRM - Activities to Manage Up-Selling and Cross-
Selling
Vodafone Telekom Eagle Plus
We have formalized procedures of cross-selling to
valuable customers.
7 7 6 4
We have formalized procedure of up-selling to
valuable customers
7 7 6 4
We try to systematically tend our "share of customer"
with high-value customers.
7 7 6 4
We have systematic approaches to mature
relationships with high-value customers in order to be
able to cross-sell or up-sell earlier.
7 7 4 4
We provide individualized incentives for valuable
customers if they intensify their business with us.
7 7 5 4
TOTAL 35 35 27 20

6. Activities to Retain Customers
Related to activities to retain customers, with regard to the first two questions, Vodafone and
Telekom are providing an interactive two-way communication with their customers. Compared
with Eagle and Plus they are better managing customer retaining activities. Their marketing
and sales department activities are actively stressing customer satisfaction and loyalty as their
top priority, and provide relationship marketing to deliver positive customer experience. Both
scored 7. On the other hand, Eagle and Plus are following but not with the same speed. They
both scored respectively 4.5.
Regarding other questions of these stage, again Vodafone and Telekom show their superiority
compared with Eagle and Plus. They have an integrated customer information system across
all customer contact points (mail, telephone, website, stores, social media and face-to-face).
They are providing systematically customized offers and services based on the value of the
customer, managing their expectations effectively and building long-term relationships with
them. Their scores are respectively 7 (Vodafone) and 6.8 (Telekom). In difference with them,
Eagle and Plus have not reached the same resources and capabilities to achieve the same
performance compared with Vodafone and Telekom. Their total score in this stage are 35 for
Vodafone, followed by Telekom with 34, then Eagle with 32 and Plus 27.
Table 8. CRM Retain Stage
CRM – Activities to Retain Customers Vodafone Telekom Eagle Plus
We maintain an interactive two-way communication
with our customers.
7 7 5 5
We actively stress customer loyalty or retention
programs.
7 7 4 4
We integrate customer information across customer
contact points (mail, telephone, Web. fax, face-to-
face).
7 6 5 3
We are structured to optimally respond to groups of
customers with different values.
7 7 4 4
We systematically attempt to customize
products/services based on the value of the customer.
7 7 5 4
We systematically attempt to manage the
expectations of high value customers.
7 7 4 3
We attempt to build long-term relationships with our
high value customers.
7 7 5 4
TOTAL 35 34 32 27

7. Activities to Manage Customer Referrals
By focusing on delivering positive customer experience, Vodafone and Telekom know the
value and the importance of referrals. Regarding the first two questions, they are systematically
tracking and managing effectively their referrals. As we will describe on the case study of
Vodafone, they have started in their stores “The Net Promoter Score” method to measure the
quality of customer service as well as manage the referrals based on the customer feedback that
this method is providing through specific questions. Both companies have scored 7. In contrast
with them Eagle and Plus have not reached to manage these activities due to the lack of tools
and resources. Their scores are respectively 4.5 (Eagle) and 3.5 (Plus)
With regard to the last two questions, Vodafone and Telekom are providing incentives for
existing customers (promoters) that are helping them generate more referrals and new leads.
These companies with their large customer base as well as promoting effecting customer
referrals are gaining more and more customers. They both scored 7. In contrast, Eagle (4) and
Plus (3.5) do not have the same customer base as well as resources to follow and manage
customer referrals with the same level. Their total score in this stage are 28 for both Vodafone
and Telekom, followed by Eagle with 17 and Plus 14.
Table 9. CRM Referrals Stage
8. Measurement at Termination Stage
Related to the first two questions, Vodafone and Telekom have established an advanced
system for identifying non profitable lower-value customers, and have established procedures
for actively discontinuing relationships with low-value or problem customers. They both
scored 7. Comparing with them, Eagle and Plus have not the same system and procedures and,
CRM - Activities to Manage Customer Referrals Vodafone Telekom Eagle Plus
We systematically track referrals. 7 7 4 4
We try to actively manage the customer referral
process.
7 7 5 3
We provide current customers with incentives for
acquiring new potential customers.
7 7 4 4
We offer different incentives for referral generation
based on the value of acquired customers.
7 7 4 3
TOTAL 28 28 17 14

they are trying to attract and acquire these left customers from Vodafone and Telekom. They
are focusing on acquiring all customers in the market even when they have a low-value.
Regarding the last two questions, Vodafone and Telekom try to passively discontinue
relationships with low-value or problem customer as well as offer incentive to low-value
customers for terminating their relationship. This enables them to have more time to focus on
high profitable customers and deliver effective solutions and high customer care for them. But,
based on difficult economic conditions that Albania has, they are not willing to leave totally
their low-value customers, due to their future value as well as recommendations. Both their
scores are 6.
Comparing with them, Eagle (4.5) and Plus (3.5) are trying to attract and acquire these left
customers. They are focusing on acquiring all customers in the market even when they have a
low-value. Their total score in this stage are 26 for both Vodafone and Telekom, followed by
Eagle with 18 and Plus 14.
Table 10. CRM Termination Stage
CRM - Measurement at Termination Stage Vodafone Telekom Eagle Plus
We have a formal system for identifying non
profitable lower-value customers.
7 7 5 4
We have a formal policy or procedure for
actively discontinuing relationships with low-
value or problem customers.
7 7 4 3
We try to passively discontinue relationships
with low-value or problem customer.
6 6 5 4
We offer is incentive to low-value customers
for terminating their relationship.
6 6 4 3
TOTAL 26 26 18 14
9. Activities to Demarket Customers Actively (EXIT)
Related with these questions, Vodafone and Telekom have a formal procedure for
discontinuing relationships with low-value or problem customers. They passively discontinue
relationships with low-value or problem customers, for example, they are raising basic service
fees, they refer to other companies or offer disincentives to low-value customers for
terminating their relationships. They both scored 7. On other hand, even Eagle and Plus have
formal procedures for discontinuing relationships with low-value or problem customers, but

their focus is not in these activities as well as they are not willing to end the contracts with
their customers because they customer base is smaller compared with Vodafone and Telekom.
Their total score in this stage are 21 for both Vodafone and Telekom, followed by Eagle and
Plus that have both 15.
Table 11. CRM Exit Stage
Activities to Demarket Customers
Actively (EXIT)
Vodafone Telekom Eagle Plus
We have a formal policy or procedure for
actively discontinuing relationships with
low-value or problem customers (e.g.,
canceling customer accounts).
7 7 5 5
We try to passively discontinue
relationships with low-value or problem
customers (e.g., raising basic service fees).
7 7 5 5
We offer disincentives to low-value
customers for terminating their
relationships (e.g., offering poorer
service).
7 7 5 5
TOTAL 21 21 15 15
Based on the results of this structured questionnaire, through measuring CRM activities and
strategies of the four telecommunication companies we understand the impact of each stage on
interactions with customers. Comparing those companies by putting benchmarks, we evaluate
their business productivity, understand the differences on their CRM effectiveness and identify
their competitive advantages.
The value of CRM is highly appreciated by these companies, as an effective tool that facilitates
employees’ activities to execute effective strategies to achieve overall performance, attain
growth and increase profitability and market share.
Firstly, based on their global experience, Vodafone and Telekom have highly invested in their
technologies to deliver the same services and customer experience in all markets that they are
operating. Comparing with their competitors Eagle and Plus, their quality of information
technology resources is larger. These companies have invested in technologies that enable
them to manage "real time" customer feedback, give solutions and facilitate their overall
activities.

Secondly, Vodafone and Telekom have invested on developing human resources as well as
their skills and capabilities to deal effectively with their customers. They have systematic
training procedures that enable employees to deal differently and positively with high and low
value customers. They have a reward system for employees for building and deepening
positive relationships with their core customers. In addition to that, their CRM is organized in a
way to optimally respond to customer groups with different profitability. Delivering
customized treatment and personalized offers to different customer segments is their company’
strength, comparing with Eagle and Plus.
Figure 5. "CRM Performance Measurement"
In the figure above we have analyzed the accumulated points for each of the stages of the CRM
adopted by the four companies. As shown above Vodafone and Telekom show higher
accumulated points compared with the other two companies. Furthermore, for some of the
stages this difference is more pronounced. Thus, for the initiation stage, Vodafone and
Telekom show comparable values when compared with each other but higher values when
compared to Eagle Mobile and Plus. Nevertheless, when analyzing these results we observe
that in general Vodafone and Telekom marketing strategies in terms of CRM are very

comparable. When these results are compared with the two other companies we observe that
for some of the stages there is a very pronounced difference. Interesting to point out is the fact
that the retention strategies for all four companies are very comparable suggesting important
efforts for the all above companies in the stage of customer retention. For the maintenance
stage we observe still a difference between Vodafone and Telekom when compared to the
other two companies.
Finally, by analyzing the above tables, we can understand why Vodafone Albania (with 289
total score) and Telekom Albania (with 286 total score) are more competitive compared to
Eagle Mobile (with 199 total score) and Plus Communication (with 168 total score). They have
achieved a higher performance in all nine stages compared with Eagle Mobile and Plus
Communication. Based on their global expertise and years of business experience, they have
developed and maximized their systems, resources and capabilities to effectively implement
the technologies and CRM strategies. Compared to their competitors, they have higher CRM
performance on each activity which enables them to generate more customers, manage and
develop effectively their existing customers, build long term relationships by delivering higher
customer experience as well as regaining back their lost customers by successfully
reestablishing the relationships with them. These are their competitive advantages that enable
them to have a better overall performance and continuously attain more market share.

CHAPTER 5. CASE STUDY - Vodafone Albania
5.1 CRM Performance Measurements
Vodafone Albania (with 48.8% market share) followed by Telekom Albania (31.8 % market
share) are the leading companies in the Albanian telecommunication industry. One of the key
factors that has contributed on attaining their success in such a competitive environment is
their focus and dedication on developing and maintaining positive customer relationships, as
well as implementing the most effective strategies for increasing customer satisfaction and
loyalty.
In contrast with Vodafone Albania, Telekom is focused more on effectively managing the
existing customers, and less on acquiring new customers. After analyzing their business
strategy of the past three years, we understand that after the acquisition of AMC, Telekom is
more in a study phase. It’s focused more on studying the Albanian market as a new business
environment for them and are approaching to enter strategically. They are conducting market
analysis, customer behavior analysis and based on that they will formulate and implement their
business strategy for competing to increase their market share.
5.2 CRM Business Strategy Analysis
The core strategy of Vodafone is the focus on managing effectively their existing customers.
They have 35 Business Key Account Managers (B2B department) that are dedicating 60 % of
their time on activities such as customer care and customer management, finding solutions for
their problems, consulting and analyzing their core customers, as well as providing packages
and offers that are personalized based on customers’ needs.
 They maintain an interactive two-way communication with our customers.
 They proactively encourage customer satisfaction and loyalty.
 They have integrated customer information across all customer contact points. (Sales
Department, Marketing Department, Finance department, Vodafone Stores and their
distributors)
 They are structured to optimally respond to groups of customers with different values.
 They systematically focus to customize products/services based on the value of the
customer.
 They systematically attempt to manage the expectations of high value customers.
 They are dedicated on building long-term relationships with their customers.

They are focused on Customer Acquisition 30 %. They are operating with Sales Force
software, one of the most effective CRM for managing leads, potential clients and customer
database. 60% of these new customers are generated from personal activities of Business Key
Account Managers. They use data and find new leads and business contacts from external
sources to identify potential high value customers. 30% are from referrals that are coming from
other satisfied customers (Promoters), and 10% are new customers from stores or returned
back clients called and followed up from their call center operators.
They are focused on Customer Development 10 %. They are performing activities such as:
customer needs analysis, developing new and personalized packages for their core customers
with high value. They are applying the “Pareto Law” focusing on 20% of core customers with
higher value and creating for them a great customer experience. These core customers have
dedicated support of Key Account Managers, and high customer service to ensure that they are
satisfied and happy with the company.
5.3 Vodafone Strategy - Delivering Great Customer Experience
Based on the survey of customer behavior analysis (chapter 6), the main reason why customers
are leaving from companies is poor customer service (65%). Vodafone knows that the best
investment is developing and training their employees to ensure that they are delivering a
unique customer experience and providing high service. The CRM software and technology are
effective tools, but they are not enough. The human resource factor is essential as well as their
skills, capabilities and motivation to use CRM activities as effective tools to manage customer
relationships and deliver great customer experience.
Why does customer experience matter? Because positive experiences lead to satisfied
customers, which correlate to loyal customers and increase lifetime customer value for the
company. Even customer experience is an integral part of CRM and the reason why it’s
important is because delivering a positive customer experience impacts the willingness of a
customer to be a loyal advocate.
Customer experience is not the same thing with customer satisfaction. Customer experience is
the sum of all experiences a customer has with a brand, whereas satisfaction, as a degree of
“happiness”, is just a component of the customer experience. As such, customer satisfaction
impacts the entire customer experience.

How does Vodafone deliver a great customer experience? They have designed an effective
strategy in detail, as a description of all experience that the company wants to deliver to its
customers. They understand that memorable and positive customer experiences are essential
for customer satisfaction and loyalty. They know very well their customers’ needs and have
designed a system for consistently delivering a high customer service, based on international
standards and best practices that should be followed by employees.
Figure 6. Net Promoter Score of Vodafone(The Image inside Stores)
This is why the strategy of Vodafone is focused on delivering a great customer experience, as
the best way to increase customer satisfaction, loyalty as well as overall business performance.
The key factors that have contributed to delivering a positive customer experience as well as
designing a high performing culture in their organization are as following:
 They have built a professional business sales team (35 Business Key Account Managers) as
well as trained employees in each store to deliver high customer service.
 Sales and periodical customer service trainings for all employees that are in contact with
customers (including employees of Vodafone’s distributors and partners).
 Training on Mindset and Skillset development
 Motivating their employees with packages, bonuses and promotions.
5.4 Net Promoter Score on Vodafone
One of the most effective methods for analyzing the attitudes and behaviors of their customers
is Net Promoter Score Method, that is implemented on the last months in Vodafone’s stores.
Based on the book "The Ultimate Question" by Reichheld (2011), customers are asked “Based
on your experience with us, how happy are you with our service? And the following question

is “What is the likelihood that you would recommend our company to a friend or colleague?
Vodafone employees are encouraging their customers to share their opinions to answer these
questions in stores or deliver it by SMS.
In addition to that, these method is adding value to the company by providing valuable
information, and a clear measure of an organization's performance through its customers' eyes.
The benefits of the company by this customer behavior analysis are as following:
First, this is enabling the company to measure, evaluate and improve customer loyalty. NPS is
a way to measure customer loyalty. The system recognizes that measuring customer
satisfaction isn’t enough - companies must understand how loyal their customers are in order
to better gauge how happy they are.
Second, customer satisfaction is increased. Vodafone employees could track customer
happiness using NPS from one survey period to the next, and be able to see if the strategies
that they have implemented have improved customer satisfaction or have had a negative
impact.
Third, it creates more customer advocates. The NPS score will give a good indication of how
many customers are advocates of Vodafone Albania. By using NPS regularly, the company can
evaluate if they are creating more customer advocates or losing them. The main focus is
providing for customers a great customer experience that will leverage customer advocates to
spread positive word of mouth and send referral leads.
Fourth, it provides valuable customer feedback. These would enable the company to manage
and improve their customer relationships continuously as well as deal faster with complaints.
Based on customer feedback, the company will proactively address problems and focus on
creating a customer experience that boosts satisfaction.
Fifth, it reduces the customer churn. By focusing on generating more promoters and delivering
positive customer experience, it will result in lower rates of churn. This means that more
customers will have longer, more profitable relationships with the company. With customer
acquisition costs increasing, reducing customer churn would provide a sustainable growth for
Vodafone.
Sixth, is a strategy that will drive revenue growth and boost customer lifetime value for the
company. By doing customer behavior analysis, company will understand what the most

effective CRM strategies are regarding the generation of more promoters, turning more
‘Passives’ and ‘Detractors’ into ‘Promoters’.
With more promoters the company will have the benefits below (Reichheld 2011):
 Promoters churn is less and they have a higher customer lifetime value.
 Promoters increase spend more than detractors, they are interested in new offerings and
using one supplier.
 Promoters are less price sensitive; they’re not always looking for ‘the best deal’.
 Promoters typically cost less when it comes to selling, marketing and advertising.
 They also have bigger average order sizes.
 Promoters account for 80-90% of referrals.
 More promoters equal more referrals.
Finally, one of the most important competitive advantages of Vodafone Albania is their focus
on delivering a great customer experience and managing effectively the relationships with
them. These capabilities and investments on the skillset of employees are also the most
effective way to increase customer satisfaction, loyalty as well as promoters.

CHAPTER 6. CUSTOMER BEHAVIOR ANALYSIS
6.1 Introduction of the survey
To better understand the effectiveness of the CRM strategies of the companies we used also a
survey to see what are the customer perception of the CRM activities of the companies. this
analysis is useful to better asses how effective are the CRM strategies of the companies and
to see what is the actual impact on the customers. The customer behaviour analysis is an
essential part to understant better the customers, how they think and feel toward companies,
their brands and services. Through it, companies can identify target customers, ascertain
better the needs of these customers, and then specifies how the product and services satisfies
these needs.
Customer behavior analysis is an effective tool that help companies to better understand their
current and potential customers, so they can deliver better customer services, increase sales
and growth. Through customer analysis, a company seeks to identify and weigh the relative
importance of factors consumers use to choose one product or service over another. These
factors, sometimes called buying criteria, are key to understanding the reasons that customers
choose to buy, engage and become loyal with the company.
Figure 7. The Image of Survey on Customer Behaviour Analysis (Fb:Egnatium Image).

By identifying customer needs through behavior analysis, companies can develop a clear and
concise value proposition which reflects the tangible benefits that customers can expect from
the company's products. And once the primary buying criteria have been identified,
marketing efforts can influence the customer's perception, improve customer relationships
and boost their satisfaction and loyalty.
With regard to the customer behaviour analysis conducted in Albania, I was highly interested
in getting more in-depth knowledge about the customer satisfaction and loyalty built on
customer experience with telecommunication companies in Albania.
Firstly, searching for industry reports or other available data on the subject, I observed that
public data on this topic is either missing or very rare to find. There were no local institutions
or customer related associations such as Customer Association to collect and publish
periodical reports on customer behavior, or customer experience such as customer barometer.
Secondly, there are only a few organizations (i.e. AKEP and an international NGO) that have
published some customer experience data due to sector regulations (customer protection laws
in telecommunications and public health service). Some individual studies of service quality
are conducted in the local banking sector that have shown some data and insights on the
customer experience, that some Albanian banks are currently delivering.
In order to have a deeper understanding about customer behavior analysis related to Albanian
telecommunications industy, I have focused my analysis in a recent survey that is conducted
in May-June 2016, that shows some interesting findings on the impact of customer service on
customer satisfaction and loyalty. These results are collected from the study of the Egnatium
Company 8
. The Customer Experience Experts conducted an online survey aiming to
understand how delivering a positive customer experience impacts the purchase behavior of
Albanian customers.
6.2 Objectives of the Survey
The study was conducted in May-June 2016 and aimed to understand the following:
 How effective customer relationship management & positive customer experience
impact the purchase behavior of customers.
8
https://www.facebook.com/egnatiumexperiences/?sk=app_190322544333196&ref=s ( www.egnatium.com
)

 How poor customer relationship management generates dissatisfied customers and
how their buying decisions have changed, based on their previous experience with a
product or service.
 To what extent they influence their friends and family members after facing a poor
service or purchasing a faulty product.
 Which is the complaint rate of dissatisfied customers.
 Is there any pattern (time-related, effort spent) in the switching behavior of
dissatisfied customers?
 Which fraction of customers are loyal to the companies and are they enough engaged
to be called their advocates (Promoters)?
6.3 Methodology
6.3.1 Context and setting of the study
Egnatium experts have collected fresh primary data from telecommunications industry
through their customers. Basically, these companies work on a monthly subscription basis
and, have a large customer base which could be used to collect feedback. With high mobile
phones penetration and the internet in the most of the local household, almost every
respondent could answer the survey.
Table 12. Customer Behavior Analysis

Table 13. Age Group Pie Chart
6.3.2 Respondent profile
The success of online surveys is depending at their respondent base. At this case, online
surveys were completed from 169 responders that shared their opinions and feedback. This
study has used a stratified sampling as these respondents are not simply Albanian users with
internet access but they had to be eligible for entering into a contractual relationship with
telecommunications companies and be the subscriber of one of them.
6.3.3 Data collection instruments
Their main tools for data collection were online questionnaires. With regard to the questions,
these have been carefully designed to “measure” the satisfaction, behavior end their
experience with these companies. Their online questionnaire was composed on rating scale
questions.

Table 14. Customer Satisfaction Analysis
6.4 Findings of the Survey
Key findings with respect to main questions are as following:
Regarding the relationship between satisfaction, loyalty and recommendations:
 1 of 5 customers were very satisfied with their company, and 84% of these satisfied
customers would highly recommend their company to friend and family members (The
promoters).
 80 % of satisfied customers said that they would continue to be loyal to their company.
 16,8 % of total customers are willing to recommend their company – (The promoters -
Customer advocacy NPS (See the graphic below)
 65 % of customers are ready to pay more for a better customer experience with their
current providers.

 Telecom providers as an industry are performing better in Customer Service (18%) than
Product offering (14%) (see the figure above).
Figure 8. The Reasons Why Customers are Leaving
The impact of poor customer relationship management:
 35,2% of customers said they stopped purchasing from a particular company when they
have a negative customer service and experience.
 The main reason why customers have left companies is customer service problems (65%),
followed by competitor’s prices (15%) and product problems (15%). (See the chart
above)
 1 out of 4 customers of that group left the company after the last complaint. The
percentage of mollified customers after the last complaint stands at 65%.
 Companies could recover up to 65% of dissatisfied customers in risk for contractual
withdrawal if they managed to complain resolution process in a time period of max 3-4
weeks.
 31,1% of customer issues get ignored by companies (they need to further insist on
improving customer relationship management).
 1 out of 8 customer complained on Facebook and other social media about poor customer
service from companies, whereas 56,8%of dissatisfied customers told their friends and
families about their bad experience with the company.
 14% of customers were considering to change the mobile company within the year 2016.
(See the figure below).

 Most of the complaints in sector come from internet speed and price of international calls.
Table 15. Customer loyalty Analysis
6.4.1 Secondary findings
Generally, a good customer experience is valued and 70% of customers are ready to pay more
for a better customer experience with their current providers. Customers said that they find
31,8% of the staff under qualified to properly answer their questions and provide them with
good solutions. Most of the complaints seem to lie in the poor customer relationships and
quality of services. What is highly evaluated in this industry is personalization and delivering
a unique customer experience through focusing on managing effective relationships.

Renato Civili MBA Master Thesis - CRM, Customer Satisfaction and Loyalty in Albanian Telecommunication Industry

Renato Civili MBA Master Thesis - CRM, Customer Satisfaction and Loyalty in Albanian Telecommunication Industry

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Viewers also liked

Viewers also liked (10)

Similar to Renato Civili MBA Master Thesis - CRM, Customer Satisfaction and Loyalty in Albanian Telecommunication Industry

Similar to Renato Civili MBA Master Thesis - CRM, Customer Satisfaction and Loyalty in Albanian Telecommunication Industry (20)

Renato Civili MBA Master Thesis - CRM, Customer Satisfaction and Loyalty in Albanian Telecommunication Industry