Term Papers 4 pages, words Online Banking: Managerial Communication and Ethics Edward L.
Get Full Essay Get access to this section to get all help you need with your essay and educational issues. CRM is a concept which is closely related to Relationship Marketing RM which concerns mainly about organizing client information in order to create appropriate and thoughtful communication and action that could strengthen the bond between a particular company and its clients.
CRM is important to UK banks because it allows the aforementioned to be more customer-centered in terms of their strategic plans to management. In addition with this, the act of documenting patterns of behavior of customers could be converted to a customer knowledge base that will serve for the purpose of analyzing or creating company rules and policies that would directly affect the customer.
Foremost CRM processes that are used in the UK banking industry more particularly of those in Barclays and Lloyds TSB are the adoption of CRM softwares which enables the aforementioned to offer service upgrades, cross-sell or just be extra sympathetic to their customers.
ERP systems are also used in order to integrate all of its customer data coming from various departments such as human resources, sales and transaction processing systems, financials, inventory, purchasing, and marketing system.
Distribution channels like mail, e-mail, website, telephone, personal call are used by both Barclays and Lloyds as well as this allows them to implement a multi-channel coverage strategy to sell products and services, negotiate, administer and retain customers. Individualized marketing and repricing are also done that in the manner in which customers will feel that they are being rewarded due to their loyalty.
Finally, a CRM strategy would not work if the people behind it such as the human resource factor of the bank are not being taken into close account.
A very effective human resource will make sure that the implementation of the CRM strategy of the organization will always be at is best. Chapter I Introduction and Objectives 1.
Due to the latter, offering almost homogenous services and products, consumers often find it easy to switch among banks. The conventional product-oriented bank has slowly becoming more customer-oriented due to giving more focus on customer loyalty as their main goal Beerli, The UK banking sector is a very diverse and competitive due to its specialist and non-bank service providers offering a range of service such as credit cards, mortgages, insurance, and loans.
The high competition in the industry has forced some financial service providers to adopt price-dominated strategies to attract new customers, albeit such was not really able to improve existing customer loyalty Farquhar and Panther, ; cited by Jones, According to Jonesif banks wanted to build customer loyalty through customer satisfaction, the aforementioned need to make sure that all points of contact customers are satisfactory whether they are personal or remote; because often times, customer complains give opportunities to the bank rectify their mistake in such a way that would lead to the increase of customer satisfaction and eventually customer loyalty.
The UK Banking Industry is characterized by three major economic services: Current accounts primarily provide the main access to money transmissions. It serves as a saving vehicle and could be used to get credit through an overdraft. On the other hand, credit cards and personal loans are used by consumers for unsecured credit.
Such provides a restricted way for money transmissions. Finally, mortgages are used for a more secured lending. It is often used in buying properties and investing in houses Cruickshank, According to the study of Cruickshank majority of the consumers find it hard to compare financial products, hence, implying that most of them are not adequately informed.
More importantly his study revealed that majority of bank costumers does not have an accurate idea of the terms and conditions of their bank accounts; at the same time they also admitted that their banks do not always provide them an effective choice among the products and services provided; hence a signal that most UK banks do not really spend so much effort in terms of adequately informing their clients.
Similar to the disposition of credit card consumers, savings accounts consumers also lamented that they are unaware not only of the terms and conditions of their credit cards but also of the processes that involves it. This result is quite expected as knowledge in terms of mortgages is very vital since it is in this service that a customer will be able to pursue their residential loans.
However this ratio of lack of consumer knowledge and awareness of credit card customers, savings account customers and mortgage customers is an evidence that there is indeed a failure among banks to adequately inform their clients and in a bigger scale helping them acquire services and programs that might suit their needs, gain their loyalty and eventually pave the way for more bank profitability Cruickshank, Given the aforementioned scenario among UK banks, it has been revealed by the study of Cruickshank that since consumers failed to see any notable differences among banks; it has been become quite easier for them to switch between the aforementioned.
One significant example could be credit card clients wherein most of them can easily switch between providers without exerting any costs from themselves as balance transfers and account cancellation could be done in just one phone call.
Bank customers who have current accounts however have to consider their standing orders, direct debits and salary payments when deciding to switch banks. On the case of mortgage and loan clients, penalties that could incur from redemption could primarily affect their decision to switch. In addition with this, certain factors like up front costs on remortgaging such as property valuation and legal fees could also affect client decisions.
This modern interest in maintaining customers is creating a revolution in marketing due to establishing a specific emphasis on value creation and building relationships. The acceptance of RM is based on empirical research, which shows how customer retention leads to increased profitability.Royal Bank of Scotland (RBS) is one of the world's leading financial services providers and one of the oldest banks in the United Kingdom (UK).
The group has continued to grow its business around the globe after the takeover of Westminster Bank in It has offices in Europe, the United States of America and Asia. The relationship marketing theory is based on market and network (Moller and Halinen, ) while customer relationship management (CRM) is based on the justice theory to explain the customer involvement as these elements influenced satisfaction, loyalty and trust involve in .
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CUSTOMER RELATIONSHIP MANAGEMENT MODEL FOR BANKS Gayathry S * VIT University, India, Tel: +; Email: [email protected] Service industry has been the forerunners in implementing CRM practices. Customer Relationship Management in Banks.
Customer Relationship Management Model in Banks.