Customer relationships
Company A
and on how responsive the customer is to opportunities offered by Company A. The classification will help the sales people to prioritize certain customer in front of others, hopefully leading to an increase in closing rate. Consequently, how customers are treated is dependent on the expected level of return from that customer. The respondent gives the following example.
However, if the customer is not that profitable but still very responsive to offers and anxious to make more business, Company A also considers that company as an important customer. This specific customer might become very profitable in the future and it is therefore important to treat the customer right.
Additionally, how customers are managed also depends on the customers’ need of close contact with Company A. Some customers buy a lot of products without being in close contact with the company and consequently Company A has a rather distant relationships with those customers. Other customers require a lot of attention and thereby Company A has a much more close relationship with those customers. The respondent emphasizes that he considers good customer interaction as very important when building close relationships with customers. He said that usually a close customer relationship, with a high level of interaction, is contingent with a good relationship between the parties involved. In addition, close customers are important for Company A, this since close customers usually see Company A as a mechanism for making profit in their own company and therefore are anxious to make more business with Company A.
Consequently, Company A has different kinds of relationships with their customers; where some are closer than others. However, most of Company A’s relationships are long-term relationships. Company A’s customer turnover is quite low, where a large part of the customer base has been customers for a very long time.
Customer Interaction
The employees at Company A who interacts with the customers vary depending on the customer. Generally speaking the main players involved in customer interaction is the Outside sales, the Telesales Desk, and the Credit Control. When dealing with boat builders the engineers also are involved in customer interaction and when producing components that other companies will use in their products the production people will be involved. This is necessary to secure the quality between the different factories. The IT Department is also involved in customer interaction. This since the retailers continuously are demanding sales statistics and Company A also needs sales statistics from the retailers.
The Marketing Function
The Marketing and Sales Function performs the major parts of the marketing of the Company Group. However, since other functions, as Credit Control, IT, Production, and R&D also interacts with the customers they are also responsible of marketing of the company.
Price sensitivity
The price sensitivity of the customer depends of how Company A presents the price change and on the characteristics of the customer. Retailers are not really concerned about price changes as long as they reflect the market situation and the level of profit percentage has not changed.
On the contrary, Boat Builders or other companies that buy components from Company A to use in their own products usually don’t like increases in price. This is a normal reaction, since it implies that their products will be more expensive to produce and consequently will force them to raise their own prices as well. This may result in some customers switching to cheaper suppliers, unless the company can motivate the increase in price in a good way.
The respondent states that it’s always important that Company A presents the reason to why they make price changes; otherwise it is very likely that the customer reaction will be quite negative.
Perceived Quality
As mentioned before the need for frequent and close contact with Company A varies between the customers. Thus, Company A’s customers also perceive quality differently. Some customers highly value having good interaction with Company A while others mostly care about the product quality.
Customer Satisfaction Measurement
Company A does not have any formal approach to measuring customer satisfaction. At present, the customers’ satisfaction is based on how the relationship between the customer and the sales people is running.
Interdependency between functions
The respondent states that it’s important with collaboration between the different functions in order to provide the customer with the best service possible. As stated earlier, the Marketing Function at Company A is not totally responsible for the marketing of the company; the other functions are also obliged to perform marketing when interacting with customers.
Internal Marketing
Company A use Internal Marketing to a certain extent. The tool they use is an Intranet Site which all employees have access to and where they can find information about the business and the market situation. The Intranet Site helps forming a common spirit in the company and will allow people to say the same things even if they operate from different parts of the business. In addition, the people working at Company A have done so for a very long time. Many of them have over 20 years of experience and know almost everything about the company. Thus, the respondent states that the employees’ perception of what Company A stands for is about the same.
Being a customer - an active role
to interact with the company while others if possible just prefers to make a fast deal with little contact with the company. Sometimes it is required that the customers actively participate, for example when Company A is producing components that the customer will use in their products. Then it is necessary that the customers communicate their wishes and requirements.
“Win-Win Attitude”
In the business concept formulated, the Company Group states, “The products and expertise provided by the group are aimed to optimizing the output of different user applications”. In other words Company A is striving to create value for the customer and thereby obtain a “win-win situation”. Additionally, The respondent underlines the importance of understanding the needs of the customers in order to offer them a product that will create customer satisfaction.
Likeliness to benefit from CRM
The respondent believes that Company A has a significant need to apply CRM and that it will generate a lot of benefits. The main reason for this is that by applying CRM the chance of creating good relationships with the customers increases, which in turn increases the possibility to sell more.
CRM complexity
Company A is in the phase of introducing the CRM approach. They have bought the Marketing Module in Jeeves Enterprise, but at present they do not use it. The employees at Company A have been reluctant to use the Marketing Module and it has been difficult for management to convince the employees of the necessity to make improvements in their way of working; they have not been very responsive to changes. According to Respondent B, the reason why many of the employees are skeptic is due to that they have been working in a certain way for many years without any problems. Hence, they do not see the incitement for changing their routines. However, Company A is using several other modules in Jeeves Enterprise and they are about 35-40 users.
Regarding the implementation of a CRM system, respondent B states that it has to be done step-by-step. Company A can’t implement a whole system at once; on the contrary they should begin with a small change that might generate a lot of advantages. This would make the employees more positively inclined.
One restriction regarding the implementation of a CRM system is the level of usage of computers among the employees at Company A. Even if Company A has a more computerized approach than many other companies they still have sales people not using computers in their daily work. Consequently, the organization has to be more adapted to a CRM approach and the employees must increase their use of computers before Company A can start to implement a CRM system.