retail and crm in india

8/10/2019 Retail and CRM in India

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Managing CRM Program in

Organized Retail in India

PRESE NTED BY -

ARPAN KHURDELIA IE20

MOHIT ASSUDANI IE51

RAHUL RAWAT IE66

ROHIT KU MAR SINGH IE73

SILKY KHURANA IE86

GROUP - 12


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RetailingRetailing is a distribution channel function, where oneorganization buys products from supplying firms ormanufactures products themselves, and then sells these directlyto consumers.

Forms of RetailingConvenience storesDiscount storesFactory/company outletsSpecialty storesSupermarketsDepartment storesHypermarkets

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Characteristics

Highly unorganized and & fragmented industry

Linkages with the economic growth ( 18% to GDP and 8% employment )

Rural and urban divide

Emergence of multiple retail formats

Long supply chain

Working capital intensive

Generating employment opportunities



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Kinds of Retailing

Unorganized :Ownership and management rest with one personAccounts for 2/3 rd of the retail market

Normally street markets, counter stores, kiosks and vendorsOrganized :

Modern retailing

Offers variety of products (quality, value for money)Shopping a memorable experience



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Organized Retail Sector

Tremendous scope; to grow faster than GDP growthin next few years

Grow at faster CAGR of 21.8% to $ 55 billion,garnering around 15% of overall retail sales

Top organized retail categories by 2015 would befood, grocery and general merchandise; apparel;

durables; food service; and home improvement



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Factors for Business GrowthRising urbanisation

Growing consumer class

Growing per capita expenditures

Economic growth

Growing spread of plastic money Changing face of Indian consumerism from necessities to luxuries

Rising number of nuclear families

Growing female working population

Developments in the real estate scenario

50% of country populace under 25 years of age; prime driving factor formodern retail sector



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Indian CustomersTime killers : Moves around & covers lot of store; spending lesstime; waiting for someone; no intention to buy; Zero conversionrate.

Focused Fulfillers : Moves quickly to the specific product; 82%conversion rate.

Product Groupies : Have specific notion about the store; willtouch many products, but focus on the target group product;37% conversion rate.

General Browsers : Cover large area; move slower than timekillers; non-focus interaction with product; 2% conversion rate.

Pleasure Seekers : Spends long time; easily influenced;urgency; 79% conversion rate.



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Customer Retention-RetailDiscount pricing

Attractive variants of products and services

Loyalty programs

Offers

Attractive service

Customer Defection-RetailPoor servicing

Quality issues

Few variants

Billing/Queuing issues

Facility location



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Customer Relationship Management

Recognizes that the customer, rather than individual purchasesor contracts, is the source of value to the firm

Focuses on customer acquisition and retention

Highlights repeat purchase and loyalty over time as keygoals

Recognizes the importance of customer satisfactionRequires customer data to forecast their response to

potential offerings and manage customers over time

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Relating with few customersEmphasizes sales forceUsually B-to-B

Relating with many customersEmphasis is on purchase historyOften, though not always B-to-C

With retail consumers (i.e. many customers)

The retailer must be able to customize the product or price or serviceoffering

The retailer must be able to address consumers individually

Customer Relationship Management



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CRM OBJECTIVES

Create loyal purchase behaviorCustomize product and price offerings to targetcustomers

Increase customer lifetime value

MassMarketing

Micro-Marketing

Consumer Targeting ContinuumSegmentMarketing

NicheMarketing



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CRM PROGRAMS

Card programs Discount Credit Membership

Specific examples Catalina coupons catalina marketing Collaborative filtering (recommenders) flipkart .com Virtual model landsend.com

How can the retailer reward loyalty rather thanpurchase volume?

http://www.catalinamarketing.com/http://www.amazon.com/http://www.landsend.com/http://www.landsend.com/http://www.landsend.com/http://www.amazon.com/http://www.catalinamarketing.com/http://www.catalinamarketing.com/http://www.catalinamarketing.com/


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CRM LOYALTY PROGRAMSLoyalty programs are set up to reward customers withincentives such as discounts on purchases, free food, gifts,or even cruises or trips in return for their repeated business.

Retailers use them for three reasons: to retain loyal customers to increase loyalty of non-loyal customers to collect information about them and what they buy

Loyal customers are the source of most profitsLess price sensitiveMore purchases per customer higher share-of-requirements



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CRM RETAIL CUSTOMER DATACustomer Relationship Management(CRM) is enabled by the gatheringand warehousing of consumer data

Retailers gather customer data from: Frequent shopper or shopper

loyalty cards Store credit cards Identifiable tender



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CRM RETAIL CUSTOMER DATA

Retail customer databases areorganized collections of data aboutindividual consumers including:

Geographic

Demographic

Behavioral data

Purchase histories

Appended behaviors

Databases may enable retailers to gain acompetitive advantage

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CRM RETAIL CUSTOMER DATA

Most leading retailers use card programs 89% of retail leaders in the practice of CRM use card

programs (Progressive Grocer, 2001)

However, retailers are not using the resulting data effectively

The retailers have collected all of this frequent shopper data,but few, if any, attempts have been made to mine theopportunities that it probably presents. (Shulman 2003)

Issues

How can retailers better exploit consumer data?How can it be used for targeted marketing offers?



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CRM DATA WAREHOUSING

Data warehousing is the coordinated and periodiccopying of data from various sources, both inside andoutside the enterprise, into an environment ready foranalytical and informational processing.

Wal-Mart makes good use of its data warehouse. Itshould. Experts estimate that it is second in size tothat of the U.S. government



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CRM DATA MINING

Data mining is the process by which insights arederived from vast amounts of data, such as thatcontained in a data warehouse.

Statistical algorithms are applied to customer data toidentify merchandise buying patterns and relationships.



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CRM MARKET BASKET ANALYSIS

A market-basket analysis is uses data mining techniques todetermine what predominant categories individual consumersare buying.

Based on these analyses, Big-Bazaar has changed the

traditional locations of several items: Since bananas are the most common item in Indias grocery carts, theysell bananas next to corn flakes (to help sell more cereal) as well as inthe produce section.

Tissues are in the paper-goods aisle and also positioned among thecough and cold medicines.



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RETAIL CRM ISSUES

How does the retailer respect the shoppers privacy whilegathering information to respond more effectively to thatcustomer?

What does the retail shopper get out of CRM? Why should(s)he give is the retailer information about (her-)himself?

Should the retailer offer different levels of price or service?What is the advantage of uniformly high prices or customerservice?

What is the appropriate level of customization? How muchdoes the retailer gain by individual, rather than store-specificoffers? At what cost?



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Analytical CRM

Analyses customer dataDesign and execution of targeted marketing & specific

customer campaigns

Optimize marketing effectiveness

Analysis of customer behavior to aid product and servicedecision making

Management decisions

Prediction of the probability of customer defection



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Applications of Analytical CRM

Campaign management and analysisCustomer segmentation

Customer satisfaction measurement

Sales Coverage Optimization

Financial ForecastingProgram Evaluation

Price OptimizationCustomer Satisfaction Growth

Product Development

Fraud Detection

Risk ManagementContact Optimization



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Impact of Analytical CRM

Customer

Acquisition

Cross-Selling Up-Selling

Customer

Retention

Retain currentcustomers

Customer

Information

Offer keyinformation tocustomerseffectively



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KPIs for CRM

Compelling product & service offeringsCreate and manage customer loyalty programs

Improved customer service

Real-time info across departments and systemsAdvanced security of client data

Customer lifetime purchase value

Customer purchase value



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Future Trends in CRM

Products in accordance with customers mindset More action than transaction

Smart shopping

International playersSocial CRM



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Thank you!

There is only one boss. The Customer!H e can f ire everybody in the company, from thechairman on down, simply by spending his moneysomewhere else.

-Sam Walton, founder of Wal-Mart

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retail and crm in india

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