1. Relationship marketing & Customer relationship managementBy
Vimolboon Cherapanukorn
13/02/2016

2. Outline Relationship marketing Customer relationship management
Activity I: Critique Case Study
Guest lecturer
Activity II: Group Brainstorming
Q &A

3. Background
In the 21st century, empowerment is provided by the digital environment, resulting in customers being more knowledgeable and demanding and requiring more attention.
(Khalifa & Shen, 2005)
Many companies have turned to Internet technologies as a way to cope with the turbulent environment resulting from increased competition; hotel marketing managers expect the Internet to gain greater importance as a marketing, reservation and promotion channel in the near future.
(Huang & Law, 2003)

4. Background
One of the most important key factors for business development and acquiring profit generation is implementation of a customer relationship management (CRM) program aimed increase customer satisfaction and maintain loyalty.
“Customer relationship management (CRM) is the best mechanism to achieve the business goals, retain customers and increase business.”
Brown (2000)

5. relationship
MARKETING

6. Relationship Marketing
Mass-marketing
1990s
Personalised Marketing
The practice of relationship marketing (RM) refers to the understanding, explanation and management of on going collaborative business relationships between suppliers and customers.
It leads to greater value creation through cooperative and collaborative relationships and with this value benefiting all engaged parties (Mitussis et al., 2006)

7. Relationship Marketing Strategy ( by Leonard L. Berry )
Core Service Strategy
Relationship Customization
Service Augmentation
Relationship Pricing
Internal Marketing

8. Mass Marketing VS Relationship Marketing

9. Relationship Marketing
It is aimed to develop long-term relationship with all partners and create higher customer loyalty and retention that might influence business performance (Butter, 1996)
RM theory is focused on the maximum number of people to concentrating on developing relationships with their existing customers (Brown, 2000)
RM practice describes customers as “associates” or “partners” enmeshed in “alliances” or “partnerships” with companies.

10. New Marketing strategy
Share of Market  Share of Customer
Logistic management & Supply Chain Management
An implementation of Customer Relationship Management (CRM)

11. Definitions and Characteristics of CRM
Customer Relationship Management (CRM) :
A strategic approach that enables organisations to use internal resources to manage their relationships with customers, improving an organisation’s performance and gaining competitive advantage.
(Mohammed & Rashid, 2012)
CRM is a strategic orientation that a business uses to identify their most important loyalty customers and to develop an understanding of how these customers can be retained and satisfied (Josiassen, Assaf, & Knezevic, 2012)

12. Definitions and Characteristics of CRM
CRM has its roots in relationship marketing, which is aimed to create long-term profitability by moving from transaction-based marketing and its primary function of attracting new customers to retaining customers loyalty and satisfaction (Sigala & Christou, 2006)
CRM is a business strategy providing a complete combination of business functions for communicating with the customers in such areas as marketing, sales, customer service, and field support through assembling people, processes and technology (Pan & Lee, 2003)

13. Customer relationship management: CRM
Implementation of CRM is involved with the people to implement the process and the technologies to support the data. RM
CRM
eCRM
People
Process
Technology

14. Customer relationship management: CRM
There are different types of CRM based on varying characteristics, which are strategic, operational, analytical and collaborative.
Types of CRM
Buttle (2009)

15. CRM transaction cycle Three stages of the CRM transaction cycle;
Phase I
Customer Acquisition: the initiation of the customer-seller relationship
Phase II
Customer Retention: the case of positive developments whereby the customer-seller relationship grows
Phase III
Customer Extension: developing after a certain period of satisfaction relationship experience and ultimately evolving into loyalty customer.
(Pechruttanamunee & Assenov, 2008)

16. CRM Success Dimension

17. Marketing & CRM supporting implementation
ระบบสนับสนุนการขาย (Sale Force Automation): A tool for managing relationship with customers and support operational process
การจัดการบริการลูกค้า (Customer Service Management): Collecting customer data through computer systems for further analyzing
การจัดกิจกรรมทางการตลาด (Activity or Campaign Management/ Marketing Automation): Developing advertisement vis various of social media platforms
การวิเคราะห์ (Analysis/Database Management): Analyzing the data from the data warehouse/ data mining to develop or improve or create new products and services

18. Electronic Customer Relationship Management (eCRM)
eCRM : A process for integrating business procedures and information technology, to collect customer information, understand customer preferences, predict customer needs, establish effective interaction and enhance customer satisfaction to maintain the rate of customers (Chen, Lin & Yang, 2011)
It emphasises on electronic management, which involves multiple IT systems that place greater efficiency personal service and product image, and analyse the relationships between the firms and their customers.
With the development of the Internet, CRM has expanded its applications and achieved remarkable development by the use of information technologies to integrate sales and services.

19. Electronic Customer relationship Management (eCRM)
eCRM emphasizes on electronic management, which involves multiple information technology systems, places a greater focuses on the efficiency, product image, and personal services and concurrently analyzes the relationships between the firms and their customers.
“eCRM is a process of integrating businesses procedures and information technology,…(it) integrates (the) Internet into sales, marketing, research and development, customer service… to collect customer information, understand customer preferences, predict customer needs, establish effective interaction and enhance customer satisfaction to maintain the rate of customers.” (Chen, Lin & Yang, 2011)

20. eCRM Dimension: TOE framework by Racherla & Hu (2008)
Technological Context
Perceived Directed Benefits of eCRM system
Perceived Indirect Benefits of eCRM system
Compatibility with Existing Structures
Organisational context
Existing Technical Skills of Personal
Financial Resources Allocated
Top Manager Support
Customer Knowledge management
Firm Size
Environmnetal Context
Perceived Threat from Competitiors
Pressure from Business Partners and the Industry
Cusotmer Expectations

21. eCRM Dimension: 12 Dimension of eCRM for retail business by Ab Hamid et al. (2011)
Ease of Navigation
Information Quality
Consumer Service Quality
Fulfilment
Integrated Marketing Channels
Online Community
Rewards
Personalization Level
Site Security
Value-added Services
Perceived Trust
Price Attractiveness
eCRM dimensions

22. Challenges of eCRM
The challenges for a firm to adopt electronic customer relationship management (eCRM) environment include;
1) balance,
2) consistency,
3) technology,
4) change management,
5) customer expectations
6) legacy customer care environment.
(Printchard & Cantor, 2000)

23. Challenges of eCRM Balance Consistency Technology Change Management
Getting it right between Customers' self-service and Agent-assisted interactions
Balance
developing an intergrated interaction channel strategy
Consistency
Adopting the right technology at the right time and with the right segmentation
Technology
Recognizing that this is radical change
Change Management
Gauging customer expectations of Web-Based Service
Customer expectations
Avoiding building on a foundation of sand and consideration of trust
Legacy Cusotmer Care Environment
(Printchard & Cantor, 2000)

24. eCRM practice Module Target-related Modules Support-related Modules
The 2 modules of eCRM systems
(Kim & Mukhopadhyay, 2011)
Target-related Modules
software components that involve analyzing customers’ preferences and purchasing behaviors without face-to- face interactions
Support-related Modules
consider direct interactions with customers, systems development and employee training should be done in a manner to meets individual customers’ expectations and maximizes customer value

25. eCRM practice and the Internet-based technology
The 2 majors advancements of the Internet which challenges the eCRM implementation;
Web 2.0’s networking and connectivity capabilities, and
The social intelligence and/or knowledge created collaboratively through user-generated content
(Sigala, 2011)

26. eCRM practice and the Internet-based technology
Web 2.0 social networking can develop a virtual community on eCRM which can be referred to as eCRM 2.0 platform.
The online virtual community and the benefits of Web technology also shift CRM implementation to knowledge enabled eCRM.
Knowledge sharing through hotels’ web 2.0 platforms aims to make customers as active partners in the value-creation process.
(Sigala, 2011)

27. eCRM 2. 0 can utilize the customer knowledge on eCRM 2
eCRM 2.0 can utilize the customer knowledge on eCRM 2.0 (CKM) in five styles
Style of customer knowledge management
Explanation
Prosumerism
Consumers creating and sharing travel videos, comments and reviews
Team-based co-learning
Collaborative creation of travel guides
Mutual innovation
Company and customer collaboration
Joint intellectual property
Social Networking websites and blogs
Communities of creation
Mash-up applications that combine resources from different partners for developing new business models and customer value

28. eCRM practice and the Internet-based technology
The Web 2.0 enabled CRM practices must reflect a consumer culture’s changing behaviour from product ‘designing for customers’ to ‘designing with’ and ‘designing by customers’ (Sigala, 2011, p. 657).
Use of eCRM with Web 2.0 technology exploits Web 2.0 tools for not only learning about customer behaviours and preferences, but also for learning and improving relationships with customers in order to achieve the maximum advantages of eCRM 2.0 implementation.

29. eCRM in the Hospitality Industry
Since the hospitality sector has experienced increased competition and high customer turnovers, the competitiveness of the industry dependents on the hotel’s ability to effectively satisfy their customers.
To attract more customers, hotels must maintain the loyalty of existing customers because the cost of gaining new customers is approximately five times greater the cost of keeping the existing ones.
(Rosenberg & Czepiel, 1984)

30. eCRM in the Hospitality Industry
eCRM success can increase business performance, which consists of 4 main dimensions;
1) financial perspective,
2) operational perspective,
3) organizational perspective,
4) customer perspective (Venkatraman & Ramanujam, 1986)
Most hotels and related industries need to develop effective eCRM strategy because the communications with their customers is mainly achieved through the Internet. However, the success in implementing eCRM initiative has been limited.
(Sigala, 2011; Lo, Stalcup, & Lee, 2010)

31. Web 2.0 & eCRM in Hospitality Industry
To complete in the global digital market, the hospitality industry should maximise the potential of Internet Technology to building relationships with consumers (Ab Hamid et al., 2010)
Hoteliers should apply the usefulness of Internet and Web applications into their eCRM implementation in order to know more about their customers’ preferences (Gilbert et al., 1999)
Web 2.0 provide not only the social knowledge developed through user generated content (UGC), but also create social networking and connectivity (Sigala, 2011)

32. Web Technologies and eCRM
The Internet has changed customers’ behaviour from traditional offline activities to the online ones and they have accepted the fact that the Internet is now a new channel for
promotion
Communication
collaborations
Web 2.0 is a revolutionary tool for collecting and integrating online information and knowledge, and it could be applied to data sharing and reuse by linking all users with similar interests and emphasizes collaboration among all users.

33. Web Technologies and eCRM
The Web 2.0 technologies enable customers to be active partners in the value creation processes.
The virtual community of the Internet and the benefits of the Web technologies have also shifted the CRM implementation to a knowledge enabled eCRM (Gibbert, Leibold & Probst, 2002)

34. Web Technologies and eCRM
Acquisition
Brand awareness through electronic word of mouth
Brand reinforcement through customer education about the brand
Customer identification and targeting
Customer understanding and profiling
Retention
Enhancing customer service
Personalization of service
Community building amongst potential and new customers
Expansion
Identifying and suggesting cross-selling opportunities
Identifying and suggesting up-selling opportunities
Affiliation programs for loyal customers
Win back
Responding and handing of customers’ complaints
Reputation monitoring and management
eCRM practices towards Web 2.0 during customer lifecycle.
There is 4 phases of customer lifecycle.
eCRM success supported by the Web 2.0 technologies allows firms to learn about the customer behaviours and satisfy customer preferences, as well as to improve their relationships with the customers.

35. 3 categories of Internet-based CRM
Pre-sale information (Information features)
A one-way information marketing of Web technology
eCommerce services (Transection features)
A two-way information marketing involving firms-customer interaction
Post-sale support (relational features)
Create customers retention /develop customer loyalty
(Arnott & Bridgewater, 2002)

36. eCRM Success & business Performance
A successful of eCRM is an opportunity to increase business performance, which includes customer satisfaction, market effectiveness, financial performance, business excellence and high profit (Wu & Chen, 2012; Lin & Su, 2003)

37. eCRM Success & business Performance
Internal collaboration
Personalised service
Customer satisfaction
Employee knowledge
Organisational change management
Innovation service
Technology utilisation
Learning & experience
Business Performance
Successful eCRM implementation can be antecedents of developing and enable the hotel to gain greater business performance
(Mohammed & Rashid, 2012;
Kimiloglu & Zarali, 2009)

38. CRM situation and problems
The growth of electronic business and the proliferation of Internet-based services, a new concept has been created electronic customer relationship management (eCRM).
It enables companies to interact with customers and continually alter their service and products to meet or exceed customer expectations, achieve businesses’ objectives and provide a better business performance.
However, 77% of eCRM projects fail to meet a company’s goals and rates of success in eCRM applications were low.
eCRM failure may be due to a lack of an eCRM strategy, measurement tools, robust adaptation approaches, IT usability, and selection of eCRM tools.
(Apicella, 2001, Sigala, 2004)

39. Activity I Critique Case Study: Antecedences of eCRM Success
(Cherapanukorn, V. & Haiyan, H., 2015)

40. A case of Thailand
The highest proportion of eCommerce business is engaged in the tourism and hospitality industry.
to provide information
to communicate
Less than 18% of the total companies established in Thailand have gained benefit from adopting ICT.
high expenditure,
complicated technology,
difficulty in recruiting qualified staffs,
lack of skills and knowledge and security concerns
Misunderstanding in practice
(National Statistical Office, 2012)
eCommerce established in Thai Industry

41. Thailand’s Hospitality Industry
Number of rooms and occupancy rates of hotels in Thailand
Thailand has been recognised as one of the famous tourist destinations.
The report of World Tourism Organisation (UNWTO, 2014) illustrated that Thailand had the largest accommodation capacity in Southeast Asia.
Room occupancy rates were slightly under 50% of the total room capacity (UNWTO,2014)

42. Research objectives
To explore the antecedents and consequences of eCRM success
To identify the determinants of eCRM Success based on implementation through Web 2.0 technology platforms;
To investigate the relationship between successful eCRM implementation and hotel performance.

43. Research conceptual framework

44. 4 Dimension of eCRM Success through the Web 2.0
Organisation orientation refers to the organisational variables that affect the CRM implementation results; including top management support, employee training and motivation and organisational structure/processes. The role of the human resource in the CRM practice in hotels is fundamental, because even with the most advanced technology, people still have a determinant role in managing relationship with customers.
Customer orientation involves various practices such as focusing on key customer retention, emphasis exemplary customer service, or offering superior products and services. They also noted that the main purpose of customer-oriented behaviour is to increase customers’ long- lasting satisfaction and to develop customer loyalty. In the hotel context, CRM implementation involves moving from a product orientated selling model, to a customer- orientated one by focusing on customers’ needs. Therefore, a business with good customer- oriented CRM characteristics ensures a tremendous positive impact on the firm’s performance.

45. 4 Dimension of eCRM Success through the Web 2.0
Information Technology (IT) orientation includes the front-office applications that support service, sales and marketing, customer data repositories and back-office applications. This is particularly true for hotels, which have a enormous amount of information to manage, and successful CRM requires significant investments in technologies that allow to collect and consolidate on an unprecedented scale of customer information.
Knowledge orientation capability is the ability of an organisation to capture, manage and deliver real-time information. The success of CRM depends heavily on the analysis of customer information and the use of this knowledge to develop highly personalised offerings.

46. Research methodology

47. Research Finding There are 4 dimensions of eCRM success
Organization (3 factors)
Customer (4 factors)
Knowledge (3 factors)
Information Technology (3 factors)

48. Research Finding: 1) Organization orientation

49. Research Finding: 2) Customer orientation

50. Research Finding: 3) Knowledge orientation

51. Research Finding: 4) Information Technology orientation

52. Researching Finding: eCRM sucess

53. Information Technology
Research summary
Among these four constructs,
“knowledge Orientation” construct was found to have more contribution to eCRM Success rather than other dimensions, followed by “Information Technology”, “Customer” and “Organisation” orientations.
Knowledge
Information Technology
Customer
Organization

54. Critique
From the research result, there are 4 dimensions of eCRM success and in each dimensions also has sub factors.
please form a group of 3-4 people
Discuss / Critique this search’s finding based on your opinion
Agree or disagree (in which area and explain why?)
Advantages or disadvantages of this search
Suggest some ideas for the further study

55. Activity I: Critique case study
Share your idea
Activity I: Critique case study

56. Guest lecturer From Holliday Inn Hotel, Pattaya
Ms Petcahrat Kullawutmaytakit

57. Holliday Inn hotel, Pattaya

58. Activity II:
Group brainstorming

59. Group brainstorming From the previous group in activity I
After listening about CRM implementation case of Holliday Inn Hotel, Pattaya
Please search 1 business and exploring about its CRM implementation through the web-based technologies.
Website
Social media applications
Social network
Discuss 1) How this company implementation CRM?
2) Suggest any improvement regarding CRM practice
3) share to the class

60. 10 min for each group + 5 mins Q & A
Sharing idea to class
10 min for each group + 5 mins Q & A

61. Thank you very much for your attention
Q & A