DISCUSS THE MARKETING CONCEPTS OF CUSTOMER VALUE
MAXIMIZATION IN TERMS OF CUSTOMER RELATIONSHIP MANAGEMENT
USING AN ORGANISATION OF YOUR CHOICE.
The old adage “You cannot manage what you cannot measure” thus, when you want to
manage customers, you should understand how to measure the value contribution each
customer makes to a firm. Customers are the lifeblood of every business; without them, there
is no profit and no consumer value. Based on the viewpoint taken, varying meanings of
customer relationship management (CRM) exist. Customer value is an important term in
CRM because it refers to the economic value of the customer relationship to the company.
The financial importance of a customer partnership to a company is known as customer
value. It can be calculated as a contribution margin or a net benefit. Customer trust is thereby
created in the marketplace rather than in a factory or an organization. Customer value is
essential to businesses because it is used to measure their marketing activities. It is, however,
a broad word that does not apply to a single period of time or length. Customer value, as a
marketing measure, provides valuable decision support, as well as the potential to assess
marketing efficacy. Combining consumer satisfaction at the core of a company's decision-
making process allows it to help quantify and refine its marketing activities. Thus, we can
define CRM from a customer value perspective as:"CRM is the practice of analyzing and
using marketing databases and leveraging communication technologies to determine
corporate practices and methods that maximize the lifetime value of each customer to
Despite the fact that customer relationship management has been commonly recognized as a
critical business strategy, there is no generally agreed meaning of the term. CRM is an
"enterprise approach to identifying and shaping consumer behavior through positive
interactions in order to increase customer acquisition, retention, satisfaction, and
profitability," according to Swift (Bhade, Gulalkari, Harwani, & Dhage, 2018). CRM,
according to Kincaid, is "the systematic use of knowledge, systems, technologies, and people
through the entire consumer life cycle to manage the customer's experience with the
organization (marketing, distribution, services, and support)" (Guo, 2017). Customer
relationship management (CRM) is the practice of keeping accurate records on individual
consumers and closely monitoring all customer "touch points" in order to increase customer
, satisfaction. By the effective use of individual account records, customer relationship
management allows businesses to offer exemplary real-time customer support. Companies
should tailor business offers, services, programs, messages, and media based on what they
know about each valued client (Yan, 2019).
The easiest way to ensure that a client stays with a brand for the long run and wants to
purchase from it is to provide them with the goods or services they seek, at competitive cost,
and with excellent customer service. There are, however, still clear steps that a business
should take to allow consumers to stay longer and pay more. The challenge is determining
which actions to take for which consumers and when to take them in order to achieve the best
outcomes.
Customer segmentation is the first principle of customer satisfaction maximization (CRM).
Instead of hard-coding some preconceived ideas, drawing hypotheses on what makes
consumers close to one another, or looking solely at aggregated/averaged numbers, it's
critical to divide customers into small clusters and approach individual customers based on
real habits (which hides important facts about individual customers) (Bhade, et al., 2018). A
classic example is that of Econet which has different customers statuses depending on how
much you buy airtime and uses EcoCash (Platinum customers, gold customers, bronze
customers, silver customers among others. This helps in how Econet treats customers as some
are served with more urgency as compared to others. In any case it would be customer
relations error to treat a customer who buys airtime worth $50 USD per month the same way
you treat one who buys airtime worth $5 USD per month. Thus customer segmentation is a
viable concept as far as customer value maximization is concerned.
The next concept of customer value maximization (CRM) is that of tracking customers over
time. Instead of simply deciding where consumers are now without respect to how or where
they came, it is important to track how customers migrate through various segments over
time (i.e., dynamic segmentation), including consumer lifecycle background and cohort
analysis (Miglietta, Battisti, & Campanella, 2017). Econet tracks each and every customer
such that they know the person who buys more airtime than the others, uses EcoCash than the
others, uses bank transfer than the others etc. They also track call records and SMS records.
They also track to know whether a number is still functional or not and how frequent is it
being used by the user.
MAXIMIZATION IN TERMS OF CUSTOMER RELATIONSHIP MANAGEMENT
USING AN ORGANISATION OF YOUR CHOICE.
The old adage “You cannot manage what you cannot measure” thus, when you want to
manage customers, you should understand how to measure the value contribution each
customer makes to a firm. Customers are the lifeblood of every business; without them, there
is no profit and no consumer value. Based on the viewpoint taken, varying meanings of
customer relationship management (CRM) exist. Customer value is an important term in
CRM because it refers to the economic value of the customer relationship to the company.
The financial importance of a customer partnership to a company is known as customer
value. It can be calculated as a contribution margin or a net benefit. Customer trust is thereby
created in the marketplace rather than in a factory or an organization. Customer value is
essential to businesses because it is used to measure their marketing activities. It is, however,
a broad word that does not apply to a single period of time or length. Customer value, as a
marketing measure, provides valuable decision support, as well as the potential to assess
marketing efficacy. Combining consumer satisfaction at the core of a company's decision-
making process allows it to help quantify and refine its marketing activities. Thus, we can
define CRM from a customer value perspective as:"CRM is the practice of analyzing and
using marketing databases and leveraging communication technologies to determine
corporate practices and methods that maximize the lifetime value of each customer to
Despite the fact that customer relationship management has been commonly recognized as a
critical business strategy, there is no generally agreed meaning of the term. CRM is an
"enterprise approach to identifying and shaping consumer behavior through positive
interactions in order to increase customer acquisition, retention, satisfaction, and
profitability," according to Swift (Bhade, Gulalkari, Harwani, & Dhage, 2018). CRM,
according to Kincaid, is "the systematic use of knowledge, systems, technologies, and people
through the entire consumer life cycle to manage the customer's experience with the
organization (marketing, distribution, services, and support)" (Guo, 2017). Customer
relationship management (CRM) is the practice of keeping accurate records on individual
consumers and closely monitoring all customer "touch points" in order to increase customer
, satisfaction. By the effective use of individual account records, customer relationship
management allows businesses to offer exemplary real-time customer support. Companies
should tailor business offers, services, programs, messages, and media based on what they
know about each valued client (Yan, 2019).
The easiest way to ensure that a client stays with a brand for the long run and wants to
purchase from it is to provide them with the goods or services they seek, at competitive cost,
and with excellent customer service. There are, however, still clear steps that a business
should take to allow consumers to stay longer and pay more. The challenge is determining
which actions to take for which consumers and when to take them in order to achieve the best
outcomes.
Customer segmentation is the first principle of customer satisfaction maximization (CRM).
Instead of hard-coding some preconceived ideas, drawing hypotheses on what makes
consumers close to one another, or looking solely at aggregated/averaged numbers, it's
critical to divide customers into small clusters and approach individual customers based on
real habits (which hides important facts about individual customers) (Bhade, et al., 2018). A
classic example is that of Econet which has different customers statuses depending on how
much you buy airtime and uses EcoCash (Platinum customers, gold customers, bronze
customers, silver customers among others. This helps in how Econet treats customers as some
are served with more urgency as compared to others. In any case it would be customer
relations error to treat a customer who buys airtime worth $50 USD per month the same way
you treat one who buys airtime worth $5 USD per month. Thus customer segmentation is a
viable concept as far as customer value maximization is concerned.
The next concept of customer value maximization (CRM) is that of tracking customers over
time. Instead of simply deciding where consumers are now without respect to how or where
they came, it is important to track how customers migrate through various segments over
time (i.e., dynamic segmentation), including consumer lifecycle background and cohort
analysis (Miglietta, Battisti, & Campanella, 2017). Econet tracks each and every customer
such that they know the person who buys more airtime than the others, uses EcoCash than the
others, uses bank transfer than the others etc. They also track call records and SMS records.
They also track to know whether a number is still functional or not and how frequent is it
being used by the user.
