Facts:

1. A person in Crossroads Restaurant who had ordered for salad, and French fries seems
to be in hurry and has asked the waitress to get the order really fast.
2. He was assured that his order will be served within next 10 minutes.
3. About half an hour went by, but that person was not served with his order.
4. When he started shouting, the manager came to his table, he served the order,
apologizing for the long wait and informing him that the food was burnt.
5. The man had his food but still seemed to be furious on the restaurant as he thought
the reason given for the delay was a lie. As “how can they burn salad?” asked to
the manager.
6. Afterwards the person was served with a dish of ice cream with plate of fruit salad
which was complementary.
7. He was also given gift voucher of the restaurant inviting him and his family for dinner
at crossroads.
8. At the end the man felt that the manager turned a poor customer experience into a
great one, but he kept on pondering over the exact reason for delay.

Discussion Question:

1. Referring to the incident given, discuss importance of CRM in Services Marketing.

2. “Not determining the true value of the customer while practising CRM is detrimental
to any business.” Was apt to give complementary ice-cream and food voucher to the
annoyed man? Analyse the statement in view of this incident.
3. Does a company always need to communicate real reason for the customer service-
related issue? Discuss and substantiate your answer.

Introduction:

Customers to any business should be one of their most precious assets. Looking after your
customers should be high on the list of any business owner's priorities, failure to do this will
mean they will look elsewhere and go to one of your competitors. Something which any
business wants to avoid at all costs. To ensure that you are giving your customers the very
best service and are constantly meeting their needs day in day out you need to realize the
importance of CRM.

Customer relationship management in its broadest sense simply means managing all
customer interactions. In practice, this requires using information about your customers and
prospects to more effectively interact with your customers in all stages of your relationship
with them.1 We refer to these stages as the customer life cycle.

The customer life cycle has three stages:

•Acquiring customers
•Increasing the value of the customer
•Retaining good customers

In hospitality, each customer relationship has value and should be managed effectively. There
is opportunity for repurchase and recommendation from each past customer. The
administration of the information about this past guest and the effective integration of the
information into frontline guest services programs is the challenge of CRM implementation.

In the light of above framework, we would be discussing the above questions:

1. Referring to the incident given, discuss importance of CRM in Services Marketing.

In reference to the above incident, the CRM is very much important as it has turned a poor
customer experience into a great one by providing the person with the complementary dish of
ice-cream and free gift vouchers inviting him and his family for dinner at crossroads.

Thus following are the importance of CRM which are associated with service marketing:

 Turn poor service experience into a great one

 Provide better customer service every time
 Increase customer revenues
 Discover new customers by past referrals

1
http://www.solica.com/brochures/WhatIsCRM
  Cross sell/Up Sell products more effectively
 Help sales staff close deals faster
 Simplify marketing and sales processes

Thus CRM would ensure:

1. Personally recognizing customers;

2. Offering appropriate value and great service to encourage repeat business;

3. Insuring that employee and guest satisfaction continues to improve; and

4. Beating the competition by offering a better product, competing on the service

experience rather than price alone.

2. “Not determining the true value of the customer while practising CRM is
detrimental to any business.” Was apt to give complementary ice-cream and food
voucher to the annoyed man? Analyse the statement in view of this incident.

In this era of globalization where ‘Customer is the King’, customer expectations are going up
which is making the situation more and more competitive. As the product is becoming
generic in nature, the hotel industry can no longer rely on the traditional marketing strategies
to retain the customers. Thus determining the true value of the customer while practising
CRM is very important. In this case giving complementary ice cream and food voucher to the
annoyed man was very appropriate. As it has ultimately turned the poor experience of the
customer into a great one which would at last make him forget about this poor experience at
the end of the day.

3. Does a company always need to communicate real reason for the customer service-
related issue? Discuss and substantiate your answer.
The following are some of the recommendations for more effective implementation of CRM
in this reference:

1. Conducting monthly guest/customer surveys help in getting customer feedback

and to improve in the areas where there is a lag as suggested by the feedback.

2. Maintaining suggestion boxes at every touch point/point of interaction with the

customers.

3. Taking feedback not only from external customers but also the internal customers
i.e., the employees.

4. Proper check on the restaurant staff’s and processes’ efficiency by the

management, say by employing Mystery Customers.

5. Employing effective CRM software to improve guest satisfaction, lower

operating costs, build guest loyalty, and increase revenues.

6. Employing an efficient system of complaints handling as complaints are the

opportunities to improve, to impress the customers and to turn complaining
customers into loyal ones.

7. Giving recognition awards to attract old customers.

8. Giving the customers a more personalized and empathic services as building good
rapport with the customers goes along way in having satisfied and return
customers.

Conclusion:

Customer relationship management does not enable a quick win. It is a long-term approach
that has to be adopted at a strategic level. Whilst the value of customer relationship
management has been identified by organizations, they are yet to look at the bigger picture
and understand all of associated benefits that would enable their business strategies to be
successful. Those responsible for delivery are perhaps the most informed about these
strategic benefits yet the transformation is long-drawn-out process. The competencies
required to deliver these customer benefits are: to deliver on its service promise, integrate
products and service channels effectively, customize products & service and their respective
prices, create opportunities for cross selling and delivery mechanisms for the onward
promotion of these products and services and reduce the gestation period to market by
allowing quick and effective introduction of new products and services.