Customer relationship management

IN

Submitted by:

Sanjay singh Malara

Submitted to :

Mrs kavita shukla

Contents

Introduction of crm

Introduction of HDFC Bank

Why CRM in HDFC Bank

CRM Solution

Importance of CRM

Benefits from CRM

Six frame-work model

Hexagon Model

IDIC Model

Results of implementing CRM

Competitive Advantage

Recommendations

Introduction of C.R.M

The term CRM stands for Customer Relationship Management. Customer relationship management (CRM) is a broadly recognized, widely-implemented strategy for managing and nurturing a company’s interactions with customers, clients and sales prospects. It is a process or a methodology used to learn more about customers' needs and behaviors in order to develop stronger relationships with them. CRM is as a process that will help bring together lots of pieces of information about customers, sales, marketing effectiveness, responsiveness and market trends. This process helps businesses use technology and human resources to gain insight into the behavior of customers and the value of those customers.

It involves using technology to organize, automate, and synchronize business processes principally sales activities, but also those for marketing, customer service, and technical support. The overall goals are to find, attract, and win new clients, nurture and retain those the company already has, entice former clients back into the fold, and reduce the costs of marketing and client service. When an implementation is effective, people, processes, and technology work in synergy to increase profitability, and reduce operational costs.

INTRODUCTION OF HDFC BANK

Profile

The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private sector, as part of the RBI's liberalization of the Indian Banking Industry in 1994. The bank was incorporated in August 1994 in the name of 'HDFC Bank Limited', with its registered office in Mumbai, India. HDFC Bank commenced operations as a Scheduled Commercial Bank in January 1995.

Business Focus

HDFC Bank's mission is to be a World-Class Indian Bank. The objective is to build sound customer franchises across distinct businesses so as to be the preferred provider of banking services for target retail and wholesale customer segments, and to achieve healthy growth in profitability, consistent with the bank's risk appetite.

Distribution

HDFC Bank is headquartered in Mumbai. The Bank at present has an enviable network of 1,725 branches spread in 780 cities across India. All branches are linked on an online real-time basis. Customers in over 500 locations are also serviced through Telephone Banking. The Bank's expansion plans take into account the need to have a presence in all major industrial and commercial centers where its corporate customers are located as well as the need to build a strong retail customer base for both deposits and loan products.

The Bank also has 4,393 networked ATMs across these cities. Moreover, HDFC Bank's ATM network can be accessed by all domestic and international Visa/MasterCard, Visa Electron/Maestro, Plus/Cirrus and American Express Credit/Charge cardholders.

Why crm in HDFC Bank

The challenges

With HDFC Bank’s success and rapid growth, it needed an effective way to increase customer profitability through deeper, stronger customer relationships.

It also needed a way to detect important events in a customer’s life so that targeted communications could be sent at the right time to build relationships and increase profit.

A central, automated process was required to access data across systems as well as plan, design, test, optimize and execute marketing efforts across channels including direct mail, email, SMS and call centers.

Huge competition with other private and public banks. Data integration – now days HDFC Bank is providing various other facilities

like security trading, insurance, etc. so for these the data integration is required. The employees relating to these departments can have the account information and deal with the customers.

Cross selling - hdfc bank wants that the customers uses the various products and services of their bank. So for this they require information about the customer and then find the needs and requirement and then sell to them.

Customization – different customers have different needs and wants. So as to understand it and design the product for them is a difficult job without a crm solution.

CRM solution

Implementing a customer relationship management (CRM) system at a bank takes careful planning. Banks need to involve key employees in the vendor decision so that they choose a system which will give them the most for their investment. Ease of use and ability to view information quickly are equally important to employees and managers. After evaluating several vendors, HDFC Bank selected UNICA’S AFFINIUM solution for enterprise marketing management. Affinium was chosen for its ease of use, quick implementation as well as its robust modeling, customer analysis, and right-time interaction management capabilities.

Importance of crm in Banking sector

Campaign management - HDFC Bank needs to indentify customers, tailor products and services to meet their need and sell the products to them. CRM helps the bank to do this by Campaign Management through internal and external information collected by bank. It then forms profile of each customer according to their lifestyle, income, requirements. Then from these profiles bank comes to know which customers are to be targeted and what to do for them.

Customer information consolidation – Instead of storing information in product centric manner i.e. different information for savings a/c and for credit cards they follow customer centric manner, storing all the information which is required at one place so that it can be used by various department to serve the same customer. This is called data integration.

360` view of company – means that who so ever the bank speaks to, irrespective of whether he is from marketing, finance or support, the bank is aware of the interaction. CRM helps in inconsistency in data, thereby making the client interaction process easy and smooth. This helps in relation building.

Personalized home page - CRM provides a single view where the sales department can view all the information at one place, including opportunity account, news, and expense report information. This helps in fast decision making.

Activity management - crm helps managers to assign and track the activity of various members. This improves transparency and efficiency.

Operational inefficiency removable – crm helps in strategy formulation which eliminates operational inefficiency. An effective crm solution supports all channels of communication i.e. telephonic, fax, e-mail, internal portal, ATM, face to face contact with the employee. It also connects all these customer touch points with operation center and operation center with internal and external partners.

Enhance productivity – crm helps HDFC bank in enhancing productivity of employee, partners and customers. It enables customer service agents to provide uniform services with all medium such as telephone, internal portals, face to face contact, fax, etc.

Crm with business intelligence - HDFC Bank needs to analyze the performance of customer relationship, uncover trends in customer behavior and to understand the true business value of their customer. Crm with business intelligence allow bank to asses’ customer segments, which helps them to calculate net present value (NPV) of a particular segment over a period to find customer’s lifetime value. Customers can be evaluated within a given framework. With this bank can easily target the most profitable customer and reengineer the unprofitable one.

Benefits of C.R.M.These CRM initiatives have been shown to help companies attain the following objectives:

To provide better customer service. To increase customer revenues. To discover new customers. To cross sell/up sell products more effectively. To help sales staff close deals faster. To make call centers more efficient. To simplify marketing and sales processes.

The advantages can also be summarized according to the domain it contributes to:

Marketing To make intelligent business decisions with enhanced customer insights. To increase marketing velocity and speed to market. To maximize visibility into and control of your entire marketing process. To drive customer demand up. To increase returns on the marketing investments

Sales To grow profitable relationships. To maintain focus on productive activity. To eliminate barriers to productivity. To improve sales efficiency service. To transform service into a profitable line of business. To increase customer loyalty. To increase the sales revenue. T reduce costs of customer service and field service To decrease service giveaways

Web channel enablement

To drive revenue and extend market reach; To reduce the cost of sales and support

To increase customer convince and satisfaction; To increase sales and service profitability To build lasting customer loyalty;

Running and customer interaction

To increase customer satisfaction; To improve creditability with your customers; To increases productivity and revenue; To manage the customer interaction life cycle

DRAW a 6 market frame work

Internal market – the employees of the bank are very crucial for success. For customer the employee is the bank as he tract with him daily. If the staff are not satisfied or in good mood then that will be reflected in the services they provide. So the banks policy should be that they try to keep all the employees satisfied.

Recruitment marketing – selecting right person for a right job is a difficult task. HDFC Bank has to plan all the requirements and job specification, according to that they have to select the employee. As said earlier in banking sector employee play a key role in success.

Referral market – the word of mouth marketing works a lot. When a customer is satisfied, he tells his friends, relatives and known that HDFC Bank services are good, their interest rate of loan is not high, the deposit rates are high. This helps the bank increase customer base and profits.

Influence marketing – ruling body of bank i.e. RBI, policy plays an important role in functioning of banks. They lay all the important policy which the banks have to follow. The lending rate, deposit rates all are affected by the policy of RBI.

Supplier Market – the raw material in banks are computers, software, furniture, etc. So the bank has to put focus on all the suppliers of these commodities. In bank performance enhancement technology plays a vital role. The bank should be updated with technologies.

DRAW HEXAGON PROFILE MODEL

In HDFC Bank the initial customers are less as compared to repeat customers. This is because if customers are satisfied with the services they keep on doing business with banks. They do regular transactions. The bank tries to do cross selling. If customers is saving a/c holder they try to sell insurance policy, demat a/c, credit and debit card, etc.

There are many customers who would like to give suggestions to bank for improvement in product and services. Their valuable insights are important for bank, and they are used for product development. These types of customers are called the advocates.

IDIC MODEL

Identify – ( learn about customers) HDFC Bank has to first learn about the customers. In banking the very important thing while opening an a/c is KYC i.e. Know Your Customers. The bank has to first know about the customers. They should know the name, age, sex, address, family, etc. Along with all these they should also know their past and present status of the customers, their needs and wants.

Differentiate – HDFC Banks have many products and services. They have to differentiate the customers according to their income, status, needs and requirements. They then have to plan and develop products catering to a specific group of people. This is the type of differentiation banks are following.

Interact – there are various touch points where customers can interact. They can retrieve and send information from telephone, e-mail, internal portals, fax, face to face interaction with employee. The banks collects all the information about the customer they can. They try to develop a good relationship with the clients. They try to maintain all personal information also so that better relationship can be developed.

Customize – HDFC bank develop many products according to the income, status, needs and requirement. They have wealth manager who cater the requirements of the clients. They focus on high net worth individuals. They plan and suggest the customers where to invest and how much to invest.

Results

Crm helped HDFC Bank to become the 3rdbest bank in India. With Affinium , HDFC Bank has boosted customer retention by four

percent, and executed acquisition campaigns, which resulted in reduction of acquisition cost by 60 percent due to effective targeting and channel optimization.

Following the implementation of Affinium, the campaign volume increased by over 200 percent

The credit card activation campaign has achieved an incremental activation rate of 30 percent compared to activation efforts without predictive modeling.

Debit card early activation program resulted in incremental response of five percent over the normal activation rates.

Now HDFC Bank could provide various facilities to its customers like demat a/c, insurance policy, bills payment facilities, etc. other than its core business of providing loans and keeping deposits of customers;

CRM solution gave HDFC Bank an upper edge in fighting with its competitors.

Competitive advantage

HDFC Bank comes in 3rd ranking of all commercial banks in India. It has a great competitive advantage over all other banks. This is because the relationship which they with their customers is too good. They have been focusing on it from the beginning. The parameters on which HDFC Bank has given maximum weight age to build business are

Employees – they have very good front end employees, who deal with customers on regular basis. They have been trained in such a way that they always maintain good relationship with clients. They always have a smile on their face and treat customers as their family members.

Technology – HDFC Bank tries to be updated in technology department. They use all the new technology which will be beneficiary for them to deal with customers. They try to make transaction and system easy for customers.

Customer Realtionship – bank has always maintained a policy of knowing the customer well. Their first aim is to understand the customer plan, need and requirement. For this they need to know the financial position and status of the customers. They always try to maintain good relationship with them.

Recommendations

Make the customer relationship building more strong – try to improve the relationship, so that customers don’t ever think to shift to other banks.

Provide wealth manager to valuable customers, so that they design their investment policy. This helps in strong relation building and retaining customers.

Try to do more cross selling – CRM solution helps in cross-selling. Try to target the customers for using more and more products.

Introduce more loyalty programs like giving more schemes and offers on credit cards.

Improve ways to reduce customer grievances’ – HDFC Bank should work on reducing customer problems, if they face. Try to solve all the problems as quick as possible because small issues can lead to big problems and make customer dissatisfied.

Take customer feedback regularly and work on it.