BCO6604: Customer Relationship Management Literature Review Analysis

This literature review examines the multifaceted aspects of Customer Relationship Management (CRM), emphasizing customer loyalty as a pivotal element. It explores how companies employ various strategies, including prioritizing customer service and fostering customer engagement through feedback and innovation, to enhance satisfaction and retention. The review highlights the benefits of these strategies, such as increased revenue, reduced marketing costs, and improved brand image, while also addressing the challenges companies face, including the need for exceptional service, the limitations of marketing alone, and the difficulties for smaller enterprises. Real-world examples, such as Apple Inc., are used to illustrate these points. The review also acknowledges the impact of technology, particularly in the context of digitalization and social media, on CRM and customer loyalty programs, ultimately concluding that a comprehensive approach is essential for effective CRM.

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CUSTOMER RELATION MANAGEMENT
6/7/2019
Student name

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Literature review
There have been various studies conducted to develop new version of customer relationship
management considering various marketing tools and the marketing managers can use
information technology. Customer relationship management is very broad aspect, among which
customer loyalty is one of the important element. Customer loyalty is the desired outcome of
rapid physical attribute, emotional experience and perceives value of goods and services by the
customers that is offered by the company’s (Goffin, 2017). Considering the loyalty of the
customers towards the company, brand or repetitive use of the products or services can be
identified. However, customer loyalty is not only regarding the repetition of the purchase of
particular brand this would also include having the brand as conversation between family and
friends. This ensures that the customers are fully satisfied, or may be addicted to the use of that
particular product. Therefore, it can be identified that the customer satisfaction and customer
loyalty are two completely different terms and elements of customer relationship management.
At the basis criterion, the customer loyalty is at times including the customers to be depicting the
product, brands, activities, and services of the company (Chan & Khodakarami, 2014).
The company includes various strategies to increase customer loyalty; these can also be said as
customer retention strategies. Some of the strategies identified through the study by various
scholars considering real life basis. Firstly, making customer services as the priority for the
organizations; it has been observed that the customers as per the changing social trends are
considering the services of the company to create image or perceiving value. Moreover, the
services orientation of the company’s has shown the visible difference in the customer loyalty,
especially in industries like retailing (Hudson & Roth, 2016). For instance, the retail industry has

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been identified as the critical change due to integration of digitalization in the industry where the
major leader is Amazon. Amazon being the first mover to bring digitalization to this industry has
increase the value to the customer through extraordinary service provided to the customer along
with best quality goods. Secondly, customer engagement; this include taking customer advice,
feedback, and idea for new product development, improvement of the product and services, and
understanding customer need and expectation in order to keep the satisfaction level of the
customer higher (Kaplan, 2015). For this, the company can even use advanced technology to
reach to maximum possible customers that is through social media platforms. Thus, it can be said
that the feedback from the customers and amend to those feedback could improve the customer
satisfaction and customer loyalty. Through implementing these strategies the company can
actually gain various advantages (Choi, 2015).
For a brand or company, the key benefits that have been identified include increase in revenue.
The revenue of the company are based on sale of the company which would largely depends of
the customer database that is increasing number of new customers and retaining the existing one.
It has been studied that attracting new customer are easy but retaining those customer require
higher efforts by the company. Another key advantage is reduction in marketing cost for the
company; the reason being the company needs to make efforts to increase the customer in
numbers but is the customers are satisfied and are making repetitive purchase then the marketing
efforts by the company could be reduced (Chu & Liu, 2017). Another key benefit would be
increase in brand image; the reason being the customer depicts to be maximum satisfied through
the brand products and since the customer is also encouraging their related people to use the
products, the brand image is eventually increasing. The forecasting is also become easy for the
company when the customer loyalty is enhanced; the reason being the purchase is repetitive so

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the company can understand the demand of the product in future depending upon the purchasing
statistics of the company. The company strategizes to maintain their customer loyalty and retain
maximum customers. However there are various challenges that a company faces while retaining
their clients and increasing customer loyalty (Zanng & Bilgihan, 2015). One of the major
illustrations of customer loyalty in the real case would be Apple Inc., which is one of the largest
electronic companies manufacturing premium quality electronic range of mobile phones, laptops,
music devices and many more. This company has been able to provide best quality products and
services to the customer and the brand image is so strong globally that the company are able to
retain their customers. From the research, it can be said that most of the Apple customer do not
shift to another brand, especially with case of IPhone users. In case they are willing to change
their phones, they opt for higher model of Apple instead of switching to another brand (Chung,
2015).
The key challenges faced by the company are firstly delivery of extra ordinary service by the
company. The company in order to maintain the relationship with the customers and retain them
needs to provide various services which could be difficult to provide and may increase the
company cost and time provided to a single customer. This is the key challenge because it is not
always possible to provide to services as per the customer expectation. Moreover there are
chances that the customer may take due advantage of the company to increase their services and
promise to repeat but in real stance due to increases in competition and decreased buyer
switching cost has made this more difficult to the company. Secondly, only marketing is not
enough; this reflect that the customer retention is not only depends on the marketing by the
company (Hu et al., 2016). A company requires lot more elements in order to maintain a good
customer relation and enhance the customer loyalty, which is another major challenge. For

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instance, a company may require maintaining the stores, enhancing human resource skills and
providing training, increase the service level, maintain or keep improving the product quality
offered by the company (Choi, 2015). Not suitable or approachable for small enterprises; the
reason being the companies working or conducting business at small scale could not provide the
services and expected product quality as compared to global leaders. For example, the local
retailer of the company working at small and medium level may not be able to provide home
deliveries, quick services, large number of variety when compared to amazon. Therefore, it is
challenging for small enterprises to maintain customer loyalty due to more availability of product
and services from various other companies or brand (Harrigan & Choudhury, 2014).
Customer loyalty and technology are directly interconnected and in changing technological
environment the customer retention loyalty has observed different phase. Technology has
changed the scenarios ion eth market, where getting customer loyalty has become an opportunity
n ad one the same had challenge for the companies. For instance retaining customer includes
marketing as the key action, which has become easier through digitalization say social media
platforms. The social media platforms now are used by the company to increase the sale of the
company and provide effective product and service information through online mode. Moreover
the customer feedbacks, as identified above are another strategy that the company can use to
increase the customer loyalty (Gong & Yi, 2018). Moreover, the supermarket studied that the
customer loyalty programs has been better executed and has increased in the industry due to
technological use. For instance, the technological advancement has been the beneficial aspect for
the companies like Amazon, and APPLE, which has discussed in literature per the research
previously. As per research conducted by food marketing institute the benefits of the retailers
due to customer loyalty program conducted are reduction of advertisement and promotional cost

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by around 10 to 20 percent. It helps the company to enhance the customer retention by 11
percent; and also help to increase the sale of the company by 10 to 20 percent. Some of the
technologies developed and used in supermarkets are RFID to tag the key chains for the
customer with frequent shopping to create strategies to retain them (retailitinsights, 2019).

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Conclusion
Through the literature the key highlighting aspects related to customer loyalty include Customer
relationship management is very broad aspect, among which customer loyalty is one of the
important element. Considering the loyalty of the customers towards the company, brand or
repetitive use of the products or services can be identified. Customer loyalty is the desired
outcome of rapid physical attribute, emotional experience and perceives value of goods and
services by the customers that is offered by the company’s. Some of the strategies identified
through the study by various scholars considering real life basis like making customer services as
the priority for the organizations; customer engagement. This include taking customer advice,
feedback, and idea for new product development, improvement of the product and services, and
understanding customer need and expectation in order to keep the satisfaction level of the
customer higher. The key benefits that have been identified include increase in revenue,
reduction in marketing cost for the company; increase in brand image. The forecasting is also
become easy for the company when the customer loyalty is enhanced.

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References
Chan, Y.E. & Khodakarami, F., 2014. Exploring the role of customer relationship management
(CRM) systems in customer knowledge creation. Information & Management, pp.27-42.
Choi, M.G., 2015. The effects of CSR on customer satisfaction and loyalty in China: the
moderating role of corporate image. Journal of Economics, Business and Management, 3(5),
pp.542-47. Available at: http://www.joebm.com/papers/243-M10014.pdf.
Chu, C.N. & Liu, S., 2017. Hedonic Pricing Method, the Third Law of Demand, and Marketing
Strategy: An Abstract. In Academy of Marketing Science Annual Conference, p.721.
Chung, T.L., 2015. The role of listening in e-contact center customer relationship management.
Journal of services marketing, 29(1), pp.49-58.
Goffin, K., 2017. Sustainability and new product development.. In Cranfield on Corporate
Sustainability, pp.105-18.
Gong, T. & Yi, Y., 2018. The effect of service quality on customer satisfaction, loyalty, and
happiness in five Asian countries. Psychology & Marketing, p.472.
Harrigan, P. & Choudhury, M.M., 2014. CRM to social CRM: the integration of new
technologies into customer relationship management. Journal of Strategic Marketing, pp.149-76.
Hudson, S. & Roth, M.S., 2016. The influence of social media interactions on consumer–brand
relationships: A three-country study of brand perceptions and marketing behaviors. International
Journal of Research in Marketing, 33(1), p.27.
Hu, M.Y., Krush, M.T. & Agnihotri, R., 2016. Social media: Influencing customer satisfaction in
B2B sales. Industrial Marketing Management, p.172.
Kaplan, B., 2015. Marketing Strategies For The Generation “C” Consumer Behavior: An
Overview For The GSM Market in Turkey. In Handbook of Research on Developing Sustainable
Value in Economics, Finance, and Marketing, pp.463-75. Available at: https://www.igi-
global.com/chapter/marketing-strategies-for-the-generation-c-consumer-behavior/121375.
retailitinsights, 2019. build-customer-loyalty-with-technology. [Online] Available at:
https://www.retailitinsights.com/doc/build-customer-loyalty-with-technology-0001.
Zanng, T. & Bilgihan, A., 2015. Customer loyalty: a review and future directions with a special
focus on the hospitality industry. International Journal of Contemporary Hospitality
Management, 27(3), pp.379-414.

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