Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
Submitted to:
Submitted By:
Rajesh Ghosh
Roll No. 05-F1-121
(2005-2007)
I am deeply indebted to DR. JAGJIT SINGH, executive president, & PROF. NAVIN
AHLAWAT, IMM, New Delhi. Who has always been a source of great help, guidance
Every effort has been made to reduce to the minimum the printing and calculation
mistakes.
I sincerely believe that the road to improvement is never ending. Hence, I will look
RAJESH GHOSH
BATCH (2005-2007)
2
TABLE OF CONTENTS
1 ACKNOWLEDGEMENT 2
2 INTRODUCTION 4
4 RESEARCH METHOD 26
6 DEALER SURVEY 36
9 CUSTOMER PROFITABILITY 70
12 CRM IMPLEMENTATION 97
3
17 MEASURING CRM PROGRESS 134
19 BIBLIOGRAPHY 140
4
1 INTRODUCTION
AIRTEL comes to you from Bharti Cellular Limited - a part of the biggest private
integrated telecom conglomerate, Bharti Enterprises. Bharti provides a range of telecom
services, which include Cellular, Basic, Internet and recently introduced National Long
Distance. Bharti also manufactures and exports telephone terminals and cordless phones.
Apart from being the largest manufacturer of telephone instruments in India, it is also the
first company to export its products to the USA. Bharti is the leading cellular service
provider, with a footprint in 21 states covering all four metros and more than 8 million
satisfied customers.
VISION
MISSION
We will meet global standards for telecom services that delight customers through:
Empowered Employees
Innovative Services
Cost Efficiency
The strategic objective is to consolidate its leadership position among mobile service
providers in India. Through its subsidiaries, Bharti has licences to provide GSM services
in 15 of the 22 telecom circles in the country. It now proposes to consolidate all these
5
QUALITY STATEMENT
We will deliver error-free services to our customers by doing our jobs right the first time,
The Chairman and Group Managing Director of Bharti Televentures, Mr Sunil Mittal, has
sold his entire personal stock, accounting for about 0.15 per cent stake in the company, or
Share Holding
FIIs/GDR : 9.2%
Shareholders : 40,315
ABOUT BHARTI
11.50 million total customers which constitute, approximately 10.66 million mobile and
The company today offers mobile services in 21 out of 23 circles in India. The company
also provides fixed - line services and Internet access over DSL in 6 circles. The company
6
complements its mobile and fixed-line services with national and international long
distance services. The company also has a submarine cable landing station at Chennai,
which connects the submarine cable connecting Chennai and Singapore. The company
provides reliable end-to-end data and enterprise services to the corporate customers by
leveraging its nationwide fiber optic backbone, last mile connectivity in fixed-line and
mobile circles, VSATs, ISP and international bandwidth access through the gateways and
landing station.
In September 2002, Bharti leveraged its pan-India footprint to offer some never before
benefits to our customers. These succeeded in re-defining customer expectations and are
fuelling growth of the mobile category in the Western region. The benefits included a 30-
second pulse, free roaming on AirTel networks across the country, incoming calls free
from any AirTel to AirTel mobile and free airtime on one international, one national and
one local number without any monthly charges. Bharti Cellular has invested Rs 1500
crores in the Western region. This investment is to be raised further as the roll out gathers
more momentum.
7
BEST PRACTICES FOR ANALYTICAL APPLICATIONS IN THE TELECOM
INDUSTRY
Targeted acquisition
STRATEGIES ADOPTED
geographical coverage;
shop" solution;
Position itself to tap data transmission opportunities and offer advanced mobile
data services;
satisfaction;
8
The company has partnered with telecom majors like Siemens, ECI, Lucent and Duraline
for its network. While Siemens has provided the digital switching system (Siemens
EWSD) with CCS-7, a signaling protocol for faster connectivity, the billing software
(Keenan Arbor) has been sourced from Lucent. The Synchronous Digital Hierarchy
SERVICE GUARANTEE
provide error free services – ‘Services right the first time and every time’. The service
In the unlikely event of any failure in this promise, the company will give STD/ISD pre
Besides providing world-class voice products and data services, Airtel – Broadband &
Telephone Services also provides a host of value added services to its customers. These
services, which add a whole new dimension to the meaning of fixed line telephony,
include services like Voice Mail Service, Directory Assistance, Call Completion Busy
Subscriber, Delayed Hotline, Centrex and the like. The company also provides a host of
customized premium services to its customers such as live astrologers, cricket updates,
sending jokes and greeting in celebrity voices, music messaging service etc.
9
Apart from the state-of-the-art infrastructure, Airtel - Broadband & Telephone Services is
the first to provide a dedicated 24-hour call centre. The company is planning to have a
250 seater call center equipped with the best ACDs, IVRs and Call loggers to provide
INTERNATIONAL SIGNIFICANCE
There are *38 mobile operators worldwide, who have 10 million plus customers. Within
this Group 38, there are 15 mobile operators who are from Asia. In this regard, it is a
proud moment for the Indian GSM industry with Airtel becoming the first Indian GSM
operator to join this international club as its 39th member worldwide and the 16th in Asia.
The key demographics of Bharti Tele-Ventures' mobile circles are set forth below
COMPETITIVE STRENGTHS
Bharti Tele-Ventures believes that the following elements will contribute to the
provide the Company with a solid foundation to execute its business strategy:
total mobile subscribers resided in the Company's twenty one mobile circles.
10
These 21 circles collectively accounted for approximately 56% of India's land
mass;
The strong brand name recognition and a reputation for offering high quality
Quality management team with vision and proven execution skills; and
11
1999 Pre-4th Licence Post-4th Licence
Number of Mobile Circles 2 5 21
Number of Fixed-Line Circles 1 1 6
Population covered in our licensed area (%) 2% 16% 58%
Area covered in our licensed areas (%) 2% 16% 56%
Wireless Coverage Area(% of Mobile
16% 38% 97%
Customers covered)
The largest private sector integrated telecommunications services group in India in
acquisitions.
services in India.
Existing foreign shareholders have acquired direct and indirect equity interests in the
First off the block to launch fixed-line services in all the four circles of Delhi,
AWARDS
Bharti Tele-Ventures, its subsidiaries and management have received several awards and
recognitions, including:
Bharti was recognized as one of the "Leading Lights of Telecom" in Asia in November
2001 in the Asian edition of the "tele.com" magazine with analytical inputs from research
12
The leading telecommunications service provider in India in a survey of Indian
business magazine, for four consecutive years (1997 to 2000) for brand excellence,
network quality, customer service and value added service in our Delhi mobile circle;
Golden Peacock National Training Award – 1999 to Bharti Cellular for our Delhi
development of business leaders, for the best human resources and training practices;
and
Ascent – Times of India and Sodexho Pass award in 1999 from the Asia Pacific HRD
Mr. Sunil Bharti Mittal (Chairman and Group Managing Director) was honoured as "
One of the Top Entrepreneurs Worldwide" for the year 2000 and "Stars of Asia" for
Mr Sunil Bharti Mittal was selected as the "Businessman of the year 2002" by
Business India.
Mr Sunil Bharti Mittal was awarded the “Dataquest IT man of the year 2002”.
Mr Sunil Bharti Mittal was selected the "CEO of the year 2002" by World HRD
congress.
13
Mr. Akhil Gupta (Joint Managing Director) was adjudged as the Chief Financial
Officer for year 2001 for Mergers & Acquisitions activities by EIU.
On October 12, 2004 Airtel – India’s leading mobile service provider and a part of
India’s largest telecom conglomerate Bharti Enterprises had been adjudged as the
It is an exercise in futility to invest in acquiring a new customer only to lose him before
even a part of the investment can be recovered. Though retaining a customer might
require seven times more effort than acquiring one it definitely makes more economic
sense. Even from a long term perspective maintaining a good relationship with not just
profitable customers but all prospective customers will pay huge dividends. Only a churn
management system can provide a better understanding of the customer, the operators’
It is important to deliver value to the customer and put in place offers that tie in the
customer. New products and services development is essential to ensure loyalty. A churn
management solution can help devise more attractive incentives, tariff bundles, loyalty
schemes and proactive customer service along with acquisition strategies to attract the
right type of customer, thus reducing fraud and bad debt—all key to a better bottom line.
14
2 LITERATURE REVIEW
interchangeably. As Nevin (1995) points out, these terms have been used to reflect a
variety of themes and perspectives. Some of these themes offer a narrow functional
marketing perspective while others offer a perspective that is broad and somewhat
Another narrow, yet relevant, viewpoint is to consider CRM only as customer retention in
which a variety of after marketing tactics is used for customer bonding or staying in touch
after the sale is made (Vevra 1992). A more popular approach with recent application of
customers that integrate database knowledge with a long-term customer retention and
growth strategy (Peppers and Rogers 1993). Thus, Shani and Chalasani (1992) define
network with individual consumers and to continuously strengthen the network for the
15
mutual benefit of both sides, through interactive, individualized and value-added contacts
over a long period of time". Jackson (1985) applies the individual account concept in
industrial markets to suggest CRM to mean, "Marketing oriented toward strong, lasting
relationships with individual accounts". In other business contexts, Doyle and Roth
(1992), O'Neal (1989), Paul (1988), and have proposed similar views of customer
relationship management.
McKenna (1991) professes a more strategic view by putting the customer first and
shifting the role of marketing from manipulating the customer (telling and selling) to
(1995), in somewhat broader terms, also has strategic viewpoint about CRM. He stresses
that attracting new customer should be viewed only as an intermediate step in the
marketing process. Developing closer relationship with these customers and turning them
into loyal ones are equally important aspects of marketing. Thus, he proposed
studying services marketing, such as Gronroos (1990), Gummesson (1987), and Levitt
(1981). Although each one of them is espousing the value of interactions in marketing
and its consequent impact on customer relationship, Gronroos and Gummesson take a
broader perspective and advocate that customer relationships ought to be the focus and
establish, maintain, and enhance relationships with customer and other partners, at a
profit, so that the objectives of the parties involved are met. This is achieved by a mutual
customer relationships is the 'raison de etre' of the firm and marketing should be devoted
16
to building and enhancing such relationship. Similarly, Morgaan and Hunt (1994), draw
upon the distinction made between transactional exchanges and relational exchanges by
Dwyer, Schurr, and Oh (1987), to suggest the relationship marketing "refers to all
relationships".
The core theme of all CRM and relationship marketing perspectives is its focus on
cooperative and collaborative relationship between the firm and its customers, and/or
other marketing actors. Dwyer, Schurr, and Oh (1987) have characterized such
being concerned with short-term discrete transactions. The long-term orientation is often
emphasized because it is believed that marketing actors will not engage in opportunistic
behaviour if they have a long term orientation and that such relationships will be
have shown not all customer are equally profitable for an individual company (Storbacka
2000). The company therefore must be selective in tailoring its program and marketing
programs. In some cases, it could even lead to 'outsourcing of some customers' so that a
company better utilize its resources on those customers it can serve better and create
mutual value. However, the objective of a company is not to really prune its customers
base but to identify appropriate programs and methods that would be profitable and create
value for the firm and the customer. Hence, we define CRM as :
17
Customer Relationship Management is a comprehensive strategy and process of
acquiring, retaining and partnering with selective customers to create superior value
Developing customer relationships has historical antecedents going back into the pre-
industrial era. Much of it was due to direct interaction between producers of agricultural
products and their consumers. Similarly artisans often developed customized products for
each customer. Such direct interaction led to relational bonding between the producer
and the consumer. It was only after industrial era's mass production society and the
advent of middlemen that there were less frequent interactions between producers and
middlemen. And middlemen are in general oriented towards economic aspects of buying
In recent years however, several factors have contributed to the rapid development and
and even consumables, the de-intermediation process is fast changing the nature
the growth of the service economy. Since services are typically produced and
18
delivered at the same institution, it minimizes the role of the middlemen. A
greater emotional bond between the services provider and the service user also
3. Another force driving the adoption of CRM has been the total quality movement.
improve quality and reduce costs, it became necessary to involve suppliers and
customers in implementing the program at all levels of the value chain. This
needed close working relationships with customers, suppliers, and other members
4. With the advent of the digital technology and complex products, systems
parts, supplies, and the sale of services along with the individual capital
equipment. Customers liked the idea of systems integration and sellers were able
a vendor.
concerned with customers retention and loyalty (Dick and Basu 1994; Reicheld
and perhaps a more sustainable competitive advantage than acquiring new ones.
Marketers are realizing that it costs less to retain customers than to compete for
customer who is loyal and committed to the firm and its offerings.
19
6. Customer expectations have rapidly changed over the last two decades. Fueled by
service quality.
7. Today, many large internationally oriented companies are trying to become global
cooperative and collaborative solutions for global operations from their vendors
We develop a four-stage CRM process framework. The broad framework suggests that
activities for a firm with respect to a specific group of customers or with respect to an
20
collaborative relationship. Hence, it is important that a company is able to identify and
relate to defining the purpose (or objectives) of engaging in CRM, selecting parties (or
customer partners) for appropriate CRM programs; and developing programs (or
Team Structure
Purpose
- Increase Effectiveness
- Improve Efficiency
Role Specification
Planning Process
Programs
- Account Management Relationship Performance
- Retention Marketing Process Alignment - Strategic
- Co-op Agreements - Financial
- Strategic Partnerships - Marketing
Monitoring Process - Retention
- Satisfaction
- Loyalty
Communication
Partners
- Criteria
- Process Employee Motivation
Employee Training
Evolution
- Enhancement
- Improvement
Source : Sheth Jagdish N. and Atul Parvatiyar (2000), Handbook of Relationship Marketing,
Sage Publication
21
i) CRM Purpose : The overall purpose of CRM is to improve marketing
productivity and enhance mutual value for the parties involved in the relationship.
CRM has the potential to improve marketing productivity and create mutual value
firms could achieve greater marketing efficiencies. Thus, stating objectives and
defining the purpose of CRM in a company helps clarify the nature of CRM
programs and activities that ought to be performed by the partners. Defining the
purpose would also help in identifying suitable relationship partner who have the
practices suggests that there are three types of CRM programs : continuity
CRM Program
22
marketing marketing development • Global account
• Personalization programs
Partnering/co- • Affinity partnering • Logistics • Strategic
marketing partnering Partnering
• Co-branding
• Joint marketing • Co-design
• Co-development
Source : Sheth Jagdish N. and Atul Parvatiyar (2000), Handbook of Relationship Marketing,
Sage Publication
have led many companies to develop continuity marketing programs that are aimed at
both retaining customers and increasing their loyalty (Bhattacharya 1998, Payne
1995). For consumers in mass markets, these programs usually take the shape of
membership and loyalty card programs where consumers are often rewarded for
their members and loyalty relationships with the marketers. For distributor
23
long-term special services that has a potential to increase mutual value through
and satisfying each customer's need uniquely and individually (Peppers and Rogers
low costs due to the rapid development in information technology and due to the
availability of scalable data warehouses and data mining products. By using online
For distributor customers these individual marketing programs take the shape of
individual marketing has been in place for quite sometime. Known as key account
programs require extensive resource allocation and joint planning with customers.
relationships customers and marketers to serve end users needs. In the mass markets,
two types of partnering programs are most common: co-branding and affinity
partnering. In co-branding, two marketers combine their resources and skills to offer
program is similar to co-branding except that the marketers do not create a new brand
24
advantage of customer memberships in one group for cross-selling other products and
marketing efforts are how partnering programs are implemented. In such partnerships
the marketer and the distributor customers cooperate and collaborate to manage
inventory and supply logistics and sometimes engage in joint marketing efforts. For
development and co-marketing activities are not uncommon today (Young, Gilbert
25
OBJECTIVE OF THE STUDY
3
Primary objective:
Secondary objective:
of prescribed parameters pertaining to service providing at the IInd tier channel”. These
parameters are:
The first parameter is almost clear that near about all the requests from activation come to
the AirTel.
The third parameter states that customers are provided only that service which they opted.
Therefore the basic purpose or objective of my project work was to ensure these above
mentioned parameters at the dealer’s level, which is possible through the careful
understanding of the business done by them, their way or style of working, the problems
they are facing, loyalty towards the company and their level of satisfaction.
The first parameter i.e. all the services should come to Air Tel is basically related to the
dealer’s satisfaction and the customer requirement. This is because if the dealers are
satisfied with the company they will give business to it and also if the company provides
26
services according to the customer requirements the business will definitely come to
them. Lot more depends on the customer service provided by the company.
The second and third parameters i.e. timely activation and error free updation requires
understanding of the relationships between the dealers and the franchisees, their attitude
towards the customers and franchisees, the way activation’s are made and attention paid
27
RESEARCH METHODS
4
Rationale:
The customer is QUEEN. This millennium comes with new dreams, hopes, and
aspiration. It heralds the emergence of new business paradigms that will keep pace with a
world rapid changing under the impact of development in infotech and communications
technologies. It touches the lives of individual all over the world. With the growing
competition in Indian economy, virtually every company finds itself struggling for
survival today.
Today it is the consumer who delivers the final verdict. A consumer who is finicky about
what she wants. An important development in the consumer market is the emergence of
the newer younger consumer. This consumer is more open to trying new products but she
is more demanding and fickle in terms of brand loyalty. I believe smart Companies across
the country are no longer talking about product or service quality rather successful brand
will need to establish more meaningful and intimate relationship and delight their
customers.
The major application of CRM is in industrial good markets and service markets. For
relationship to start individual identifiable customers have to surface from the statistical
mass of a target segment and for this to happen on a big scale technological
transformation of the market place and the transaction are essential prerequisites.
In this millennium: the old rule will change. It will not be the big company who will
swallow the small but the fast who will out pace the slow. Success will lie in becoming a
28
Ultimately, it is the firms advantage to develop long term relationships with existing
customers because it is easier and less expensive to make an additional sale to an existing
customer than to make a new sale to a new customer. However, the effort involved for the
firm in developing and maintaining a customer relationship must be weighted agent the
expected long term benefits. Marketers must determine the ‘life time value’ of a customer
to ensure that the costs of obtaining, servicing and communication with the customer do
not exceed the potential profit. Ultimately relationship marketing involves more than
locking - in customers to a particular supplier through price, rewards or even the high cost
successful, long term relationship also requires commitment and trust, which are based on
Thus the key to company’s success does not lie with in its walls and under its ceiling, in
the offices of its vender, or the homes of its employees. It lies in the mind of the
customer, whose decision will determine whether you will post a turn over, make profits,
Research Methodology
investigation or inquiry specially through search for new facts in any branch of
knowledge”.
through objective and systematic method of findings. Thus, the term ‘research’
formulating a hypothesis, collecting the facts or data, analysing the facts and
29
reaching certain conclusions either in the form of solution(s) towards the
formulation.
The task of data collection begins after a research problem has been defined and
There are two types of data, which should be kept in mind while deciding about
the method of data collection to be used for the study viz. Primary and
secondary.
(a) Primary Data: One those which are collected a fresh and for the first time,
(b) Secondary Data: are those which have been already collected by someone
else and which have already been passed through the statistical process.
Collection of Data
(a) Primary: We collect primary data during the course of doing experiments
30
(v) Other methods like warranty cards, audits, projective techniques,
Among the above various methods of collecting Primary Data, the one that I
questionnaire survey wherein the employees and dealers of Airtel in Delhi have
(iii) The sales distributors had enough time to give well thought out answers.
(iv) Those sales distributors who are not easily approachable were reached
conveniently.
Secondary Data
When the researcher utilizes secondary data, he has to look into various sources from
where he can obtain them. Secondary data may either be published data or unpublished
data. The secondary data has been collected mainly from books, journals, magazines &
online resources on the Internet. Primary data was collected from the people from the
Printing industry.
The observations and suggestions in the report are based on the following:
31
The final stage consisted of analysis and interpretation of all the collected data. The issues
The primary research was only be carried out in Delhi only keeping in mind the
constraints faced. Though the sample size is small, the views of the Dealers and
Distributors reflects the industry opinion, hence the study is applicable to Airtel.
32
5 FINDINGS AND ANALYSIS
CENTRICITY
care is important
8. Our customers are advocates in our organization 1 2 3 4 5
TOTAL 37
Manager’s orientations
33
2. The predominant attitude around here is risk taking rather than 1 2 3 4 5
defensive
3. Managers give workers the responsibility and authority to take care of 1 2 3 4 5
customers
4. People think competition means other companies not the person down 1 2 3 4 5
the hall
5. We see ourselves as customer ands suppliers in our work relationship 1 2 3 4 5
and achievable
7. In every department we have clear measure and tracking systems to tell 1 2 3 4 5
34
service-related problems
4. Problem solving skills are used in every department and are standard 1 2 3 4 5
operating procedure
5. Our managers and supervisors have skills to influence others 1 2 3 4 5
Costs/prevention/results
The score shows that the corporate culture at Airtel is very customer oriented and the
employees are motivated, empowered and their goals are also aligned with the
35
6 DEALER SURVEY
Table-1
25
20
15 No. of dealers
10 percentage
5
0
%
0%
0%
0%
%
00
20
-4
-6
-8
-1
0-
20
40
60
80
This chart show that sixty-percent dealers fall under the category 80-100% of the
percentage of business whereas fourty dealers are below that category which is quiet a
36
1) what types of services customers want?
Table 2
No.of dealers
3
airtel Leisure
30
Airtel Business
30
Airtel Standard
From the chart, it is clear that the most popular service Among the customers is air tel
standard and airtel business becouse of their convenient tariff rates. However, each
37
2) How would you rate Air Tel’s network in your area?
Table-3
no. of dealers
Excellecnt
10
good
20
3 Needs
Improvement
The chart depicts that thirty percent dealers are not fully satisfied with the netwok. They
nelieve that there is scope for improvement as the signals are sometimes not proper in the
interiors. Sometimes even inside trhe house or shop signals get weak.
38
3) How knowledgeable is company’s customer service people?
Table – 4
Graph - 4
Immediately
0% 9% Within few
minutes (2-3
min)
takes time
91%
This chart shows that all the dealers are satisfied with the knowledge of the customer
service people of AirTel. They understand their problems and give them a reasonable
solution.
39
4) When phoning at the customer care department how quickly is the call transferred
Table – 5
Graph -5
Excellecnt
very good
18% 0%
so-so
Dis-satisfied
82%
Strongly
dissatisfied
Most of the dealers i.e. near about 90% have the problem that when they make a call to
the computerized customer care department it takes long time near about 5-10 minutes for
40
5) How responsive are the customer care executives in returning the phone calls.
Table – 6
Graph -6 Excellent
3%
Very Good
6%
0%
15% So-So
Dissatisfied
76%
Strongly
dissatisfied
Here most of the dealers are satisfied with the responsiveness of customer care executive
in calling back to them if proper solution was not available for the first time.
41
6) Dealer’s overall rating to the customer care department.
Table – 7
20
15 No. of dealers
10
5 Percentage (%)
0
dissatisfied
Excellent
So-So
Strongly
As shown above nearly thirty-six percent dealers have low level of satisfied with the
42
7) Dealer’s rating to the usefulness of sales representatives visits to them.
Table –8
12
10
8 No. of dealers
6
4 Percentage (%)
2
0
nt
d
o
od
...
ie
lle
-S
ly
Go
isf
So
ce
ng
at
Ex
ry
ro
ss
Ve
St
Di
The above chart clearly indicates that a substantial percentage of dealers (27%) have a
low level of satisfaction with the company representatives to them. Also 21 percent
43
8) Dealers rating of the schemes provided by the company for them.
Table – 9
graph 9 Excellent
Very Good
0 6
15 So-So
Dissatisfied
12
Strongly
dissatisfied
From the chart, it is clear that the dealers are not satisfied with the schemes provided by
the company. They have the complaint that thought the customers are benefited from the
various schemes there are not many schemes for their benefit. Sometimes the schemes are
communicated to them slightly late and thus them the benefits from them.
44
9) Dealer’s satisfaction with the margins or cut-off provided by the company.
Table – 10
14
12
10 No. of dealers
8
6 Percentage (%)
4
2
0
nt
ng d
d
sa 0
...
ie
oo
lle
-S
ly
St isf
G
So
ce
t
y
Ex
er
ro
is
V
The above chart indicates that near about fifty percent dealers are not much satisfied with
the margins given by the company. The possible reason for this is the frequent
fluctuations in them. Many times they get less than what is assured.
45
10) Classification of dealers according to the number of activation’s (average) made
Table – 11
12
10
8 No. of dealers
6
4 Percentage(%)
2
0
ve
ct
0
0
0
-4
-3
o
-1
-O
b
0
0
0
a
0
3
2
0
4
20-30_10_30.30_
30-40_Level of Satisfaction
No. of dealers
Percentage (%)
Excellent
18.18%
46
Very Good
12
36.37%
So-S0
11
33.33%
Dissatisfied
12.12%
Strongly dissatisfied
0%
7_21.21_
47
40 above_5_15.15_
12
10
8 No.ofdealers
6
4 Percentage(%)
2
e
0
v
t
0
c
0
o
-3
-4
-O
-1
b
0
a
0
3
2
0
4
Here the dealers are classified according to the number of activations they made in a
month. From the table and chart it is clear that they are uniformly distributed across the
classes. However the maximum percentage of dealers lies in between 20-30 activations in
48
11) Time within which dealers inform the franchisees about the receipt of activation
forms.
Table – 12
graph 12
0%
Less than 1
0% hour
1-2 hours
Greater than 2
100%
hours
of the activation forms and it all depends on how those forms are passed on to the
49
12) Passing of activation forms (C.A.F.) to the Franchisees for activation.
Table – 13 (a)
franchisee.
0-20% 20 60.60%
20-40% 3 9.10%
40-60% 5 15.15%
60-80% 0 0%
80-100% 5 15.15%
25
20
15 No. of dealers
10 Percentage
5
0
%
0%
0%
0%
%
20
00
-4
-6
-8
0-
-1
20
40
60
80
50
(b) Percentage time’s dealers send the C.A.F. to the franchisees.
Table – 13 (b)
by the dealers
0-20% 5 15.15%
20-40% 0 0%
40-60% 5 15.15%
60-80% 3 9.10%
80-100% 20 60.60%
25
20
15 No. of dealers
10 percentage
5
0
%
0%
0%
0%
%
00
20
-4
-6
-8
-1
0-
20
40
60
80
51
(c) Dealers intimate on phone to the franchisee and activations are made (C.A.F. is sent
later on)
Table – 13 (c )
month
0% 25 75.74%
0-5% 3 9.10%
20-75% 2 6.06%
> 75% 3 9.10%
30
25
No. of dealers
20
15
Percentage of
10
dealers
5
0
0% 0-5% 20- > 75%
75%
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14) Time within which a customer is activated by the franchisee after the receipt of
C.A.F.
Table – 14
12
10
8 No. of dealers
6
4 Percentage (%)
2
0
rs
rs
.
.
..
..
a
2
th
h
h
in
re
-4
-6
it h
o
2
4
W
activation. From the chart it is clear that fifty-seven percent responses come under the less than 4
hours class (combination of first two classes) which is the prescribed time by the company. Forty-
three percent fall outside that class and thus it is an important problem area which should be
properly analyzed.
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15) Dealer’s satisfaction for the time taken by the franchisees.
TABLE – 15
25
20
15 Yes
10 No
0
No. of Dealers Percentage
The chart shows that one-third dealers are not satisfied with the time taken for activation.
May times the system remains down or the workload at franchisees is high and as a result
their activation is not made on time this has a profound impact on their business.
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16) Possible reasons for the delay in activation by the franchisees.
TABLE – 16
Graph-16
45%
System Down
75% High work load
From the chart it is clear that almost seventy-five percent dealers complaint about system
down as the possible reason for the delay of activation. The other reason is high workload
at the franchisees as they have their own customers coming directly to them.
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17) Dealer’s overall level of satisfaction with the company’s services.
Table – 17
Graph-17
20
15
10
5
0 No. of dealers
Percentage (%)
..
..
..
Ve
..
S.
..
D.
E.
S.
The above hart shows that almost half of the dealers (50%) have high level of satisfaction
and they should be moved to the highest class. Thirty percent are on the average side this
clearly points out the deficiencies in the company’s policies and attitude towards the
dealers. Being the most important part of the channel network but that too not under the
company’s direct control should be properly considered and policies should be revised.
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18) Is it feasible that activations are made directly from the dealer’s office instead of
Table – 18
Graph-18
45% Yes
55% No
From the chart it is clear that there is not much difference in the opinion of dealers. Fifty-
five percent are agreed to setup the required network while forty-five percent are not. It’s
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19) In case of cheque payment do dealers wait for the clearance of cheque before passing
TABLE – 19
Graph-20
9%
Always
30% Generally
61% Never
Thirty percent depend on their appraisal of the customer and then decide
accordingly. Only ten-percent takes risk pass on the activation, as they don’t want
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20) Best/Distinctive features of the company.
Table-20
Brand Image
67%
91%
Promotional
Strategy
Excellent
Service
52% Strong
45% Network
their responses that AirTel’s Brand Image is best of the lot, the other features are also
important but the brand image is most compelling one for them.
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21) Problems faced by the dealers.(Multiple responses were given)
Table – 21
Graph-21 No dealer
recognition
24%
Promotional
15%
75% strategy
Service
48%
Fluctuating
Margins
55%
No response
This chart shows that seventy-five percent dealers are not satisfied with the company’s attitude
towards the dealers. Nearly fifty percent are not satisfied with the promotional strategy and
Services offered by the company for them. Some of them have given no responses as they
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ANALYSIS OF DEALER SURVEY
By looking at the charts and tables, one can have easy understanding of the various
parameters. Besides that, there are some other findings as well which are basically, the
1. Most of the dealers surveyed have the problem that the company does not give tem
any recognition.
3. Few are dissatisfied, as they are not provided the promotional materials like banners,
4. Nearly 30.3% of dealers have very low overall level of satisfaction with the company
(table-3).
5. Though majority of dealers has very well overall satisfaction with the customer care
department but they are highly dissatisfied with the time taken to connect to the
customer care.
6. 33.3% of total dealers surveyed are dissatisfied because of the time taken by the
7. Regarding the above mentioned point the most common problem found is system
down.
11. Though Air Tel as very broad network coverage but at some places signals are not
proper.
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CRM READINESS SCALE
7
opportunity.
supported by CRM
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8. Stakeholders can articulate projected CRM 1 2 3 4
customer-related data.
of information requirements.
resolved.
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ownership boundaries.
a result of CRM.
additional staffing)
IT stakeholders.
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CRM adaptation.
CRM.
TOTAL SCORE 85
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SCORING & INTERPRETATION
It means that the company should solidify its infrastructure, skill sets, and expectations
but should expect to continue CRM project updation in the near future as per market
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DISCUSSION
Relationships are not built and sustained with direct e-mails themselves but rather through
the types of programs that are available for which e-mail may be a delivery mechanism.
satisfaction than competing firms deliver. Managers today realize that customers match
realizations and expectations of product performance, and that it is critical for them to
deliver such performance at higher and higher levels as expectations increase due to
managers must constantly measure satisfaction levels and develop programs that help to
Customer service
Frequency/loyalty programs
Customization
Rewards programs
Community building.
CUSTOMER SERVICE
Because customers have more choices today and the targeted customers are most valuable
to the company, customer service must receive a high priority within the company. In a
general sense, any contact or “touch points” that a customer has with a firm is a customer
service encounter and has the potential to gain repeat business and help CRM or have the
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opposite effect. Programs designed to enhance customer service are normally of two
types. Reactive service is where the customer has a problem (product failure, question
about a bill, product return) and contacts the company to solve it. Airtel CALL
CENTRE have established infrastructures to deal with reactive service situations through
800 telephone numbers, faxback systems, e-mail addresses, and a variety of other
solutions. Proactive service is a different matter; this is a situation where the manager
has decided not to wait for customers to contact the firm but to rather be aggressive in
reactive solution. This is more a matter of good account management where the sales
force or other people dealing with specific customers are trained to reach out and
LOYALTY/FREQUENCY PROGRAMS
Loyalty programs (also called frequency programs) provide rewards to customers for
CUSTOMIZATION
The notion of mass customization goes beyond 1-to-1 marketing as it implies the creation
of products and services for individual customers, not simply communicating to them.
The idea is that it has turned customers into product makers rather than simply product
takers.
COMMUNITY
One of the major uses of the Web for both online and offline businesses is to build a
relationships between the customers and the company or brand. These networks and
relationships are called communities. The goal is to take a prospective relationship with a
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product and turn it into something more personal. In this way, the manager can build an
environment which makes it more difficult for the customer to leave the “family” of other
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CUSTOMER PROFITABILITY
9
ANALYSIS- IMPORTANCE
financial assets – like cash, network equipment, vehicles, and buildings. Squishy things
like customer loyalty, meanwhile, don’t fit neatly in an accountant’s general ledger.But
while customer “delight” is certainly tough to quantify, it’s a financial asset nonetheless –
In short, telecoms are warming to the idea that customers are financial assets that need to
be assured.Telecommunications firms care a lot about "customer assurance". It's just that
Customer assurance spans an array of business systems and best practices from customer
care and analytics. . . to churn management and CRM. Yet no single one of these terms
UMBRELLA
Churn & Loyalty Management: Predictive modeling & other techniques to proactively
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Business Intelligence/Analytics: Data warehouse & mining techniques to enhance
Self-Care: Web- and IVR-based techniques for lowering call center and billing costs,
CRM/Customer Care: Personal interaction techniques and policies that improve the
Data Integrity: Detecting, correcting, and maintaining the accuracy of data used in
customer assurance.
Having said that it should be realised that not all customers are equal. There are some
who give bread and butter and others who provide the jam. And there are those who
actually take away a good part of the hard earned meal! Evaluation of customer
profitability breaks the myth that .all customers, big or small, near or far. are profitable. A
good understanding of customers (be they direct customers or trade) and their profitability
helps in allocating differential resources towards them. This in turn would translate into
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Many organizations cannot even begin to improve the management of their customers
simply because they lack the information of where to start and where to focus their
efforts. Some organisations have made significant investments in IT and tried to take
advantage of the benefits on offer. But more often than not they have not integrated their
investments. CRM as a concept may be appreciated but its spin-offs have not been
In order to assess the profitability of customers, all costs need to be allocated to each of
the customer. It is relatively easy to glean direct costs like transportation cost, cost
incurred in handling returns, discounts offered etc associated with each customer.
The challenge is to allocate overheads in proportion to the resources deployed for each
customer. Activity based costing system is used for measuring costs of activities
and tracing the customer cost to the activities it consumes. e.g. Sales personnel salaries
can be allocated in proportion to the time spent in servicing the customer. Such an
exercise can become tedious in AIRTEL. In addition, one must bear in mind that the cost
of gathering data for computing customer profitability has to be in line with the benefits
They would normally expect the 80:20 rule to apply when discussing the distribution of
customer profitability with 20% of the customers providing us with 80% of profits. But
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Airtel also bears in mind that few customers would be unprofitable for reasons such as
new customers with high potential., .new product developed for them which is under
The solution they adopt by focus on the following three initiatives to improve overall
profitability:
These combined elements enable profitability analysis by various groupings and can
serve as the basis of effective marketing programs and product and service launches. This
For years, Airtel have attempted to maximize customer value through the use of general
today are seeking to extract even more information, not just from their existing financial
systems, but from customer management and operational systems as well. To accomplish
this, they are looking for an environment that can help them understand and maximize the
profitability of their existing customer base. This is particularly true in the current
economic environment where companies can no longer sustain growth through the
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purchase of customer databases alone. Instead, companies are finding that to be truly
competitive in the 21st Century, they must grow profits from existing customers.
For Airtel the 80/20 rule, that roughly 20 percent of a company's customer base accounts
for 80 percent of its revenues. This formula also implies is the remaining eighty percent
eroding for the organization. So by merely adding more customers to its base through
direct acquisition, a company might actually be reducing its value while it's increasing
Airtel’s need for organization to sustain and grow profits from internal opportunities has
led companies to search for retention and cross sell solutions that differentiate service
levels based on the total value exchange of a customer. In other words, the customers that
drive the most value for the company should be the customers that receive the highest
levels of value from your organization in the form of service and product offerings. This
means focusing more time on retaining the best customers, while spending less time on
marginally profitable customers, and ridding unprofitable ones. For this , it needed a shift
in technology.
drivers of profit or loss as these interactions flow through a customer's record and to
evaluate the specific risk and spread funding characteristics of individual products and
that average customer revenue, funding, cost, and risk information regarding products and
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While organizationally-based information represents a level of "truth" within the
actions, reaching its full potential when tied to the big picture.
GENERAL LEDGER
From the beginning of modern business, organizational information has been based on
profit and service center activity, and the financial activity of business units that drive the
detail of general ledger reporting. Once the basic available information has been
collected, a business can use it for budgeting, planning, and forecasting — all primary
This information comes from a Airtel’s business units and is then tied directly to the
general ledger. It is both highly accurate about the activity of the business unit and highly
aggregated with respect to the underlying details of the customer behavior that drives
balances, revenues, and costs for customer activity. Without this valuable information, an
organization could not operate effectively. However, as Airtel realize that customer
databases can now be turned into goldmines of potential profit, the general ledger system
alone has not been able to effectively access this customer information and turn it into
To get a deeper view of customer profitability that reflects the profit and loss behaviors of
individual customers requires a great deal of data about a customer's activities. This level
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with an organization is stored in the company's database and is driven by the profitability
model.
These specific profitability models start from base level profit objects, such as accounts,
passenger records, subscription numbers, and shipment figures combined with transaction
and interaction information, and other customer details that are required to give a
company a full view of the customer's value to the organization. In addition, there are
costs and revenues that are not transactional-based — such as the fees and costs of
establishing, maintaining, and closing a relationship these must be captured and allocated
To find the true value of behavior-based profitability, it's important to look at four areas
within this methodology that can help AIRTEL calculate their most valuable customers,
but also identify and track those that are least profitable.
FEE REVENUE
Specific fee revenue figures at the account/customer level are usually quite easy to
correlate to the general ledger. However, some level of modeling or approximation may
be needed to make allowances for small buckets of revenue as the application accounting
system or back room operations likely hide the necessary detail needed to account for this
revenue. In general, between 95 percent and 99 percent of the detail is available, but 100
percent of detail must be accounted for and allocated to achieve true customer account
accuracy.
COSTS
Customer activity level costs are often difficult and time-consuming to capture and they
are generally not as up-to-date as the figures available for a company's products and
services. This is often the case because the time and effort involved in capturing customer
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level activity costs often lag the organization's creation of new products and channels as
they enter the market. Any remaining costs not typically identified in the general ledger,
such as overhead costs that do not directly tie to customers or their level of individual
activity, should be apportioned to customers and the activities to which they apply. In
order to attain accurate data at this level, it's important that well-thought-out and specific
apportionment schemes are in place so the right groups of profit objects get the right
amount of cost.
In addition, some of the costs of doing business just do not happen at the customer level.
For instance, capital for business, market, and operational risks are only indirectly related
to customer activity. And fixed assets expense and organizational infrastructure costs
arise from organizational mandates and are also very loosely tied to customer activity.
But by capturing these activities that are most common and represent the highest amount
of cost, the organization can identify and allocate essential costs that both drive and affect
customer profitability. Once these figures are captured, additional costing work could
then be driven by customer activity levels and product offerings so that the most
Customer balances are generally correct to the general ledger, and include both monthly
and/or cycle-end balances. However, to achieve detailed level profitability often requires
the use of daily average balances for calculation of spread revenue and risk, making this
The actual interest amount paid or received by customers can be tracked in detail at the
RISK
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Just as the attributes of behavior determine revenue and expense, it is the attributes of the
profit object that determine the level of credit risk that should be assigned to customers.
Airtel use credit scores to accomplish this task. Profit objects without a credit score can,
at a minimum, use a portion of the monthly reserve for losses to approximate the cost of
credit risk. There exist many complex and highly accurate ways of determining the risk of
loss given default on a specific profit object. Additionally, there are many highly
sophisticated and accurate ways of deterring the potential for loss on a specific profit
object. All of these methodologies can be reconciled in detail back to the financial results
from the general ledger, therefore improving analysis and projections going forward.
While all of these areas improve the level of accuracy of behavioral-based reporting, they
reach their full potential when tied to a company's general ledger to achieve true customer
profitability.
costly to an organization. Yet, both systems serve essential roles in the organization and
neither can be dispensed with. To merge these two methods of analysis, it's necessary to
create an environment that captures the detailed data and serves the need of management
to plan for people and pencils. Further, this solution must accomplish its tasks in a time-
saving manner and be able to be quickly corrected when new and unforeseen issues arise.
Risk Management, Budget & Planning, Cost Allocation, Fund Transfer Pricing, Customer
architecture that addresses all financial management needs is essential. Having such an
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architecture enables an AIRTEL to detect the "white spots" and to prioritize future
The central piece of a successful financial management architecture is the enterprise data
warehouse which brings together all of the essential elements that support an
Management, and so forth. As more detail is supplied by the application systems and
brought into the structured warehouse environment, the information becomes more
consistent and reconcilable. This allows Airtel’s business to have a complete view of its
customers and its organization — while supporting the specific financial reporting needs
of the company.
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By deploying this new type of enterprise database architecture, it's now possible to marry
the accounting system information that drives the books as well as the account and
profitability. As all components of both reside in this single architecture, the comparison
and contrasting of the reporting results are made into one efficient task. And while the
results of the profitability metric may not always balance directly to the financial
statements, they are certainly reconcilable within this environment. This reconciliation
process can provide companies with a roadmap to improve the accuracy of such things as
the costing system, operations for the collection of revenue, the tying of a credit score to
It's becoming increasingly clear that typical general ledger environments alone are not
enough to support a company's need to generate highly accurate and actionable customer
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profitability models. Equally, it's clear that pure behavioral-based information is not
enough to maximize corporate profitability if it is not tied to the general ledger. However,
organizations are able to maximize products and services to their most profitable
customers and reduce or replace unprofitable ones. Together, they are helping
Yes, it took mankind thousands of years to realize that a simple shift in technology would
allow humans to fly. A similar shift in technology is making it possible for companies to
and increase customer profitability in ways that were undreamed of just a few years ago.
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KEY FACTORS THAT KEEP COMPANIES FROM ADOPTING AND USING
A lack of comprehensiveness.
The majority of customer P&Ls lack enough detail to provide a true view of total cost and
customer contribution. The most valuable customer profitability analysis captures data
manufacturing,
Data for customer P&Ls are typically extracted manually from various sources and
entered into a spreadsheet for review and analysis. This time-consuming process creates
inconsistent data gathering and analysis and infrequent updates, making its use and value
limited. In addition, customer cost and investment data need to be continually updated, as
actuals come in to replace estimates. If this continuous feed of data isn’t automated, it’s
Manual and non-comprehensive processes create results that tend to lack integrity. Data
quality compounds the issue, as critical data such as promotion cost/investment may be
found only on salespeople’s laptops. Data integrity issues cause business owners to
second- guess analytical results — and not use them to engage in a mutually beneficial
and productive dialogue with their channel customers. Without sound data integrity,
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Point-in-time and single use.
This needs to be developed and automated for continuous use and measurement, vs. a
Customer P&Ls need not be fully loaded and reconciled to corporate financial reporting
statements and systems. The focus should be on business use and reporting vs. financial
Promotional investment and spending are no longer representative of total investment and
the cost of doing business with a customer. Years ago, an understanding of customer
specific trade promotion ROI would have provided with 80 percent of the cost category of
individual customer requirements generate other significant costs and investments critical
for accurate analysis, such as freight, inventory carrying cost, HR support investment,
No linkage to strategy.
As industries have rushed toward a solution, putting technology before strategy was a key
shortfall. Companies must develop a transformation roadmap and plan for how they will
use this type of analysis to affect their bottom line. How customer profitability analysis
will be used is a key element to developing a strategy. An effective strategy and the use of
customer profitability analysis should outline mutually beneficial (to manufacturer and
customer), measurable and actionable uses and results. The manufacturer and the
customer can engage in reinvestment dialogue, using the analysis to highlight mutually
ineffective
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and inefficient activities — such as returns, unsaleables, random-case picks and
emergency orders — that are driving cost and, therefore, investment that could be more
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LIFE TIME VALUE
10
“What you use to measure your success often defines your vision and your strategy”.
According to AIRTEL , if the company’s goal is more customers, one can get them, but
they may not be profitable. Airtel are not believing in the idea that sales and discounts
are the road to success. They knows that all these may actually be the road to ruin.
Lifetime value is the net present value of the profit to be realized on the average new
customer during a given number of years. Airtel firmly believes LTV is a wonderful
concept, and can be an excellent guide to profitable strategy. The steps they are going
Get the customers to give the data, and build it into a database complete with purchase
history.
The goal of their marketing programs should be to build a relationship with customers
whose behavior can be modified, to convert them over time into long run loyal and
profitable customers. The process can be measured and tracked by using a lifetime value
chart.
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Direct Costs $4,382,400 $4,347,000 $4,388,885
Labor + Benefits 11% $580,800 $597,713 $611,111
Card Program $16, $8 $80,000 $28,000 $20,720
Advertising 2% $105,600 $108,675 $111,111
Total Costs $5,148,800 $5,081,388 $5,131,826
Gross Profit $131,200 $352,363 $423,724
Discount Rate 1.00 1.20 1.44
NPV Profit $131,200 $293,635 $294, 253
Cum. NPV Profit $131,200 $424,835 $719,088
Lifetime Value $26.24 $84.97 $143.82
In this chart, they are tracking the performance of 5,000 newly acquired customers over
three years. Their initial retention rate is 70%, which means that during the first year,
30% stop shopping with us. The retention rate goes up over time, as loyal customers are
The lifetime value of these customers is $143 in the third year. They should note that this
is based on the net present value of their profits, adjusted by a discount rate. The discount
rate is needed because money that will receive in the future is not worth as much as
money that have in hand right now. The rate discounts future money so it can be
legitimately added to current profits to get a valid lifetime value. The formula for the
D = (1 + i)n
Where i = the current interest rate plus a risk factor, and n = the number of years that have
The lifetime value numbers are really very powerful measures. They include in a single
set of numbers the retention rate, the spending rate, the costs of marketing, and the
discount rate. By themselves, however, they are not as powerful as they will be when
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This strategy is targeting certain customers whose behavior y want to change, and giving
something only to them that can afford which helps to modify their behavior.
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11 VARIOUS CRM INITIATIVES
concomitant rise in spending on people and products to implement them, it is clear that
However, there is a big difference between spending money on these people and products
and making it all work: implementation of CRM practices is still far short of ideal. Airtel
customer information. They Are continous learning how to develop better communities
around their brands giving customers more incentives to identify themselves with those
consideration of splitting the marketing manager job into two parts: one for acquisition
and one for retention. The kinds of skills that are need for the two tasks are quite
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different. People skilled in acquisition have experience in the usual tactical aspects of
marketing: advertising, sales, etc. However, the skills for retention can be quite different
as the job requires a better understanding of the underpinnings of satisfaction and loyalty
for the particular product category. In addition, time being a critical scarce resource
Airtel has appointed a chief customer officer (CCO) whose job focuses only on customer
interactions.
In this organization, the person overseeing the company’s marketing activities, the VP-
Marketing, has both product management and the CCO as direct reports. The CCO’s job
is to provide intelligence to the VP from marketing research and the customer database
for use by product managers in formulating marketing plans and making decisions. In
addition, the CCO manages the customer service operation. Although it would perhaps
seem more logical for the CCO to report to product management, the reporting
position. The CCO also interacts with other company managers whose operations may
The notion of customer satisfaction is being expanded to change CRM to CEM, Customer
Experience Management. The idea behind this is that with the number of customer
contact points increasing all the time, it is more critical than ever to measure the
experiences. These responses could include timely apologies and special offers to
compensate for unsatisfactory service. The idea is to expand the notion of a relationship
from one that is transaction-based to one that is experiential and continuous. As with any
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CREATING A CUSTOMER DATABASE
database or information file. This is the foundation for any customer relationship
with customers. The task will involve seeking historical customer contact data from
points from multiple channels and contexts. This should not only include sales
purposes.
Response to marketing stimuli. This part of the information file should contain
Though it is continuously spreading its wings, expanding its capabilities, and exploring
new horizons, one rule at Bharti remains unchanged: seek out the world’s best technology
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WHY CRM FOR AIRTEL
In a telecom services company like Bharti, airtime is considered a product. “It is vital for
them to manage the expectations of their customers and provide them with innovative
To achieve this, Bharti needed to have the appropriate means. “To better serve their
customers they needed a tool. It is this need that made them to opt for a CRM (customer
CHERRYPICKING A SOLUTION
Today Bharti is using the Oracle CRM platform. “As part of their vision, they intend to
A customer should get the same quality of service no matter which of our call centres he
contacts. This has been the vision, and because of that they have gone in for a centralised
application like CRM. The implementation of CRM also helped Bharti in having a unified
Before choosing its CRM tool, Bharti evaluated many options. It considered factors like
After a thorough evaluation, it decided to go ahead with the Oracle CRM platform.
BENEFITS
One of the primary things that Bharti has done with CRM is SEGMENTATION OF
CUSTOMERS, which has helped in providing customers more value for their money. It
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is important to understand and segregate customer needs depending on the product and
services he is buying.
METRICS
The increased attention paid to CRM means that the traditional metrics used by managers
to measure the success of their products and services in the marketplace have to be
updated. Financial and market-based indicators like profitability, market share, and profit
margins have been and will continue to be important. However, in a CRM world,
increased emphasis is being placed on developing measures that are customer-centric and
give the manager a better idea of how her CRM policies and programs are working.
Retention/churn rates
Loyalty measures.
All of these measures imply doing a better job acquiring and processing internal data to
In fact, most cellular players to be the leader, left much to be desired in meeting Telecom
business intelligence solutions such as analytical CRM can help companies gain a 360-
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degree view of the customer’s needs to address a wide range of customer initiatives
ranging from profiling and segmentation, maximising cross and up sell opportunities,
Using analytical CRM solutions, companies are empowered with answers to questions
such as:
The first step involves creating a central repository of customer data. This is created by
extracting, cleansing and transforming data from multiple sources such as the billing
systems, call detail records, customer demographic and tariff data. Once all of this data is
ready to be used for predicting the propensity of churn for a possible segment of
The churn model that is built using predictive capabilities throws up a score or a number
that ranges anywhere from 0 to 1 for a particular customer. This number typically depicts
the likelihood of a customer to churn. For example a number like 0.9 shows that the
On the basis of such information, and in keeping with various other parameters like the
average bill value of a customer, payment patterns, usage, etc., an organisation can
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strategies on various initiatives to retain the customer. This initiative is increasingly
gaining strategic importance in telecom on the basis of the fact that it costs 3 times over
Additionally, business intelligence (BI) solutions can also help to optimize network
planning and capacity, analyse, validate and monitor network fraud, run effective and
efficient marketing campaigns across multiple channels that result in higher levels of
of BI. Thus in an industry where your customer is your competitor’s prospect and an
customer satisfaction in order to foster customer loyalty and maximise lifetime value. The
dynamically every second when customers are using the services. Competition for every
customer is very crucial here, independently if the company is GSM service operator or
services the number of potential customers is very large, it corresponds with the number
of citizens in active age. Furthermore, acquiring and keeping the customers directly
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translates to company's profit. Therefore the proper understanding and care of customers
is essential and this can not be done without intelligent exploitation of the available data.
CREDIT SCORING
Credit scoring is regarded as one of the most successful data modeling applications in
business area. It involves an evaluation of your customers based on their application and
behavioral data. This analysis can be used in various situations concerning any kind of
credit offering to a customer, for example renting a valuable products or devices, mobile
phones exchange, deciding on new contracts length with the customer, evaluation and
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CUSTOMER LOYALTY / CHURN ANALYSIS
The goal of this analysis is to identify customers that are likely to leave company and join
loosing a customer means he/she will most probably use the competitor's offer. Churn
modeling helps to increase the loyalty of customers towards your company in several
ways. Discovering the factors causing a churn enables a company to address them
properly. Additionally, separating the particular group with high churn likeliness allows
Survival analysis estimates life time value of a customer and his/her churn hazard over a
time (a churn means a customer is turning to different product provider). The analysis
investigates the strength of parameter influence on expected survival time and allows to
method the company can get valuable insight into customer behavior and find ways to
Especially within telecommunication companies, the survival time analysis finds a wide
set of applications e.g. deciding when is the best time to update a contract with customer,
designing new contract duration and other conditions customized to specific client.
FRAUD DETECTION
Fraud detection has proved to be powerful method capable of saving significant amount
Detecting the frauds means identifying suspicious fraudulent transfers, orders and other
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illegal activities against your company. Models of fraud scoring can be divided into
application and behavioral scoring. Application fraud scoring detects suspicious clients at
early stage of signing a contract with the company based on data from the client's
application form. Another model - behavioral fraud scoring, is built on data collected
during the client'slife time activities e.g. billing data, usage of services or history of
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CRM IMPLEMENTATION TAILOR-MADE SCHEMES
12
Able to provide customers different schemes and services depending on airtime usage.
Customer is a heavy user then they have some specific schemes; for normal users they
They have also managed to segregate their workflow with the help of the CRM tool.
CHALLENGES - Roll it
The biggest challenge for Bharti was to have a unified process in place. Once this was
done they faced the challenge of imparting training. “When you go in for such a large-
scale implementation you will definitely have problems,” . They also had certain
CRM STRATEGY:
Operational CRM
Analytical CRM.
Operational CRM is about helping their call centres in the workflow part, helping them
Analytical CRM provides staff with the required information on customers; this is used
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MANAGING CUSTOMERS FOR VALUE ENHANCEMENT
AIRTEL believes in , “don't talk about exceeding customer satisfaction - that's passe - the
time has come to `dazzle the customer'. But to do that, first you must get customer
For Airrtel , "Managing customer relationships is not only complex but is also multi-
Particularly, as in the New Economy, the customer has become very demanding and the
various front-end functions could aid in building a viable link between the organisations
appropriate systems and processes to mine the right type of data by the right function in
an organisation."
resource.
"The success of CRM hinges on how it is implemented". Uneven focus is bad for its
implementation. Also in the new economy, targets and objectives change every few
weeks. The priorities then become very different,'' he added. The solution lies in putting
in place a set of people across the organisation focused on implementing CRM. What is
required is building relationship over a period. This could be the most integral approach
and go a long way in harvesting CRM profitability. For CRM to succeed, enterprise-wide
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In a competitive telecom marketplace, where operator service offerings look deceptively
similar, the only differentiator is the quality of customer contact responsiveness through
improved internal process management. The expansive nature of the operators’ business
errors, which could adversely impact customer retention. Customers would unlikely talk
of a satisfying experience but would definitely let out a customer service failure,
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PEOPLE STRATEGIES AT AIRTEL
13
"If CRM is the key, HR would be the nerve centre for any CRM activity."
ESOP now a vibrant tool for attraction and retention : Lowering of attrition.
WORK CULTURE
The work culture at Bharti Mobile is one that is open, informal and performance-
empowerment with accountability and entrepreneurship are some of the key ingredients
Airtel strongly believe that 'softer skills' are extremely important to deliver error-free
service to customers.
Working in teams
Inter-personal skills
Communication skills
Creative thinking
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The pace at which the company are growing demands more people with requisite
people for the future growth needs. This year as a group hired Engineer trainees and
Management Trainees from top management institutes for various group companies.
RECRUITEMENT PROCESS
Airtel primarily look for candidates with high energy levels, with a value system aligned
with ours, and having the 'softer skills' mentioned above. Only such candidates are
further interviewed.
For employees joining in Customer Services, provides job training for two weeks ending
with certification.
This year, for Management trainees, we have drawn out a detailed 52-week training
schedule. The assignments to be carried out are well scoped and with clear learning
objectives and have name of the guide and the names of 'Mentors' for each of the trainees.
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Bharti strongly believes in adding value to employees' experience. They have, in a
planned manner, moved people both laterally and vertically within the company and
within the group companies. Being in a very exciting expansion and growth phase
currently, career enhancement opportunities for employees at all levels/ all functions are
huge.
that the employees are 'at ease -at work' and have no constraints coming in their way of
here is to make every step in the process that much more simpler and easier for their
employees to follow.
The launching of a 'Quality Movement' across the organization last year has been highly
successful in
Informality
Fun
They have evolved, over the last one year, into a strong, well-knit one big family of
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One other important factor is 'employee communication'. The management strongly
views, recognizing teams and individuals in an open forum, helps developing credibility
and thereby mutual trust. This impacts the work environment very positively. Also, the
facts -that Airtel had huge successes in the last one year and that 'Bharti' is always in the
media - also compliments efforts to boost the morale and help employees take pride in
Unique HR policies
Unique policy like 'HR Reach out'. Every HR member is assigned a department. He/she
works with the department very closely not only to proactively enable employees perform
but also to partner with the business and influence business processes and policies.
Few more would be the 'Customer Contact Programme'. Once a month, all senior
managers reach out to customers to get a first hand feel and feedback from them.
Similarly, some senior managers go and meet channel partners, meet walk-in customers
Also have forums like 'Knowledge Management Meets' wherein the heads of a specific
function from other mobility circles in the group meet to share best practices.
Airtel know that only motivated and empowered employees give 100% commitment.
Thus, their strategies and objectives flow from our role. Few key objectives have
achieved and are working on, are to have clear job descriptions, performance objectives,
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training to enhance job performance and managerial skills, ensure internal equity in
compensation and benefits, have a sound rewards and recognition scheme, involve
employees in reviewing and influencing policy and process changes through team
working, have open communication forums where in employees are encouraged to ask
questions.
Also conduct
These initiatives have helped immensely in building credibility with employees and gain
The essential pre-requisites are a right attitude, commitment to quality and knowledge.
Airtel formally rolled out a 'Quality Movement'. If they have to 'deliver error-free services
right from the first time, every time', then need to consistently conform to requirements of
the customer. The aspect of 'How to' is addressed by the 'Quality Education Series' (QES)
sessions, which all employees go through. This and the other programme on QC Tools &
Techniques helps employees develop and document processes using the process model
worksheet, enter into 'service level agreements' with internal customers and conform to
their requirements.
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Attrition rate annualized is 18%. This may be far lower than what it was a year ago, but
are still hopeful of bringing this to around 14 to 15% over the year.
One of their key strategies focuses on Retention. They work very hard to retain key
contributors. They acknowledge their efforts and provide fast track growth, additional
upon currently which for instance will include inviting such employees to meetings meant
'Speed' is the main ingredient for success and when communicate this to prospective
candidates, they are very attracted to this way of working. Also, their brands AirTel and
Magic are very powerful, have been conceived very well, have high visibility and recall.
Training
Measurement
Technology
MANAGEMENT
Organizations focused on fostering customer loyalty via a motivated work force will
BENEFITS
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The benefits include:
Increased sales
Lower costs
Increased innovation
Fewer Accidents
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14 BUSINESS PROCESS SUPPORT
As the leading provider of mobile services across India, Airtel is an Indian wireless
“super brand” within a fiercely competitive mobile telecommunications market. When the
company needed a single enterprise-wide billing system to support the acceleration of its
postpaid mobile business, it turned to CSG Systems to deploy its Kenan billing and order
management systems.
While the Kenan system ensured that Airtel delivered the high-quality customer service
and products it is known for, the operator sought to do more to continue to maintain its
No. 1 status in the market. Airtel wanted to optimize every point within its infrastructure
industry best practices into its organization and leveraging its billing operations to its
fullest potential, Airtel knew it would be able to stay ahead of its competition.
To assist with this challenge, Airtel turned to CSG’s billing experts to work side-by-side
with Airtel staff on-site to meet its objectives. By leveraging CSG’s expertise in billing
operations, Airtel could focus on what it does best: delivering unparalleled mobile
While the Kenan systems were in place to run Airtel’s entire business using a two
instances billing and order management platform for postpaid and wireline business, de-
systems more challenging. Under India regulation, each business region, or “circle” was,
essentially, a separate business entity with distinct business owners, thus opening the door
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Under this de-centralized organization, Airtel realized that it needed to deploy a cohesive
and coordinated approach to operating its systems. Airtel also wanted to ensure its longer-
term self – sufficiency and not build a model that relied on third-parties for support.
Airtel turned to CSG experts for help. Under a six-month engagement, CSG’s
Professional Services team worked with Airtel staff to design to develop a world class
support for its Kenan®/BP billing engine and Kenan®/OM order management systems.
CSG also played a key role in coordinating numerous other strategic initiatives, such as
management infrastructure that will scale to support Airtel’s rapid growth over the
coming years.
Bharti’s Airtel engaged with CSG’s Professional Services Organization through the
Operate, Align and Transfer arrangement, a model by which CSG manages billing
Under this model, CSG assumed temporary ownership for Airtel’s postpaid billing
operations. During this timeframe, Airtel’s operations team reported into CSG,
learning on-the-job best practices and tuning processes daily. What ensued was a
complete analysis of the organization (design & capabilities), the processes, the
underutilized components of the solution, the revenue leaks, and the implementation
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The Operate, Align and Transfer model is part of CSG’s™ Outsourced Operations
operating billing and customer care systems and extensive product portfolio to deliver
CSG’s Outsourced Operations offerings are tailored to meet the unique business
With this approach, operators can rely on CSG to manage all or segments of their
billing and customer care infrastructure through on-site or service bureau models.
Through this offering, operators can also choose if and when they wish to take over
RESULTS:
SERVICE
Increased rating timeliness by 90%. This enables Airtel to provide current details on
what the customer has spent, and as a result gives the operator better fraud and bad
Created a Zero Billing Delay environment across all circles, providing a more
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By streamlining online data management and reducing the level of communications
required between ordering systems and switches, Airtel reduced the amount of time it
reporting tools, reducing the number of daily reports from 1,300 hard copy reports to
just 83 that can be viewed via the Web across Airtel’s organization.
The CSG team worked with the Airtel sales & marketing teams to explore software
revenue treatment) and develop strategies for how these tools could be used by Airtel
By centralizing the way in which its billing and IT operations were managed, Airtel
was ahead of its competitors when the Indian government enabled operators to obtain
COSTS
Reduced the number of bill cycles by 80% and engineered an on-time billing delivery
Implemented industry best practices via on-the-job training and effective knowledge
transfer program. AirTel now has in place a sophisticated internal billing operations
team trained to optimize system performance and fully tap system capabilities.
Besides operational efficiency and cost-savings, this also enabled increased time-to-
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Engineered and implemented a multi-year hardware infrastructure to fully optimize
Implemented more than 30 standard operating procedures with clearly defined roles
and responsibilities.
This reference model is logically layered model that includes touchpoint, business
application, process, CRM, Data management and Decision support layers. It was
developed as a result from customer feedback and extensive research in the marketplace
on Enterprise
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TOUCHPOINT AND PRESENTATION LAYER
channel-specific device. The presentation and navigation displays a consistent “look and
feel” for input and output information in the format required by the device (e.g., browser,
terminal, keyboard, keypad, phone) that is consistent across different business processes
and their functions. Navigational aids will be presented to human interfaces; buttons,
hotspots, etc on windows or browser (HTML) based interfaces, menus or other simpler
interfaces such as 3270 terminals, or interactive voice for voice channels. The navigation
function of a front-end helps the user to control the usuage of, or switch between different
elements of the presentation surface, e.g., activate a specific window with the mouse, or a
select a presentation object specific function with the right mouse button. In addition, this
layer will determine the kind of communication channel being used, and will transform
the information going to and from the process layer to the required interfacing of this
communication channel, e.g., Text-to-speech for Phone/IVR, CGI/Java for Internet, etc.
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It will also prepare the user identification and process selections required by the next
layer.
This layer determines the communication touchpoint being used, and transforms
PROCESS LAYER
devices, from a single implementation of that specific device. The process layer is
separated into a Contact, Context handler and personalization. The user accesses
and profile together form a context under which all interaction between the user and IT
functions that form and support a business process are carried out.
The Contact and Context Handler initiates and terminates the communication
business logic initiated from specific context and selects a set of business rules specific to
CRM LAYER
This layer represents databases that consist of the single customer view, integrated
contact/dialogue, customer profile, and content information. This layer also provides for
the ability to perform analytics and reporting on the customer experience by using the
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DATA MANAGEMENT LAYER
The data management layer is the first layer that has no direct link to the business
Transactions (get data x for user y and reservation z), direct read/write operations (read
user profile u), etc. Its main function is the separation of data storage from business
process functions. This is done by wrapping the calls to the new or legacy systems and
presenting
them as objects to the higher layers. Here, wrapping means transforming data in a
oriented environment. This layer may also use existing data warehouse management
services.
The AIRTEL has been a leader in implementing various decision support applications in
order to determine who their best customers are and what best services to offer them.
Regulatory changes have made this industry so competive that many existing databases,
campaign management applications, etc. exist and need to be leveraged in the upper
VERTICAL LAYERS
The vertical layers of this reference model provide services that are required by all the
horizontal layers.
In order to support the mangement of objects between the various layers some
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environment for network and system infrastructure, applications (business processes and
underlying activities), and the data layer. The following services have to be provided
IT SERVICE MANAGEMENT
All components in the model will have to be managed for availability and performance
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TECHNOLOGY NETWORK INFRASTRUCTURE - IT
15
Like any other telecom service provider, Bharti also considers information technology a
key driver of its business. “For telecom, IT is like bread and butter.
The service provider has a WAN set-up in place; it has a mix of leased lines and E1 and
E3 lines for wide area connectivity. The company also has an extranet in place through
which it extends different applications to its dealers and partners. They have an extremely
large infrastructure based on products from multiple vendors. This includes a range of
high-end servers from Sun and HP. “In the telecom business volumes are very large.
Have millions of records and have to process them everyday, so for at Airtel storage is in
terabytes”.
Bharti also has a storage area network (SAN) in place, and has selected EMC as the
storage provider for the SAN. The main data centre is located in Gurgaon, Haryana. The
company uses high-end routers from Cisco, and is in the process of implementing a
disaster recovery (DR) set-up. As far as software is concerned, some of the applications
billing
fraud management
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They also have some internal-facing applications like Oracle Financial and Oracle
HRMS.
TOOLS:
Airtel has been one of the earliest adopters of software to control churn in the Indian
Business Intelligence (BI) is an umbrella term for a set of tools and applications that
(OLAP), report generation, decision support systems (DSS), query and reporting (Q&R),
statistical analysis, forecasting, data warehousing and data mining. Some of the popular
BI tools are:
analytical processing (OLAP) tools. This software gives the end user an opportunity
Data Mining Tools - The software automatically searches for significant patterns or
Query Tools - They allow the user to ask questions about patterns or details in the
data.
For Airtel, Business intelligence is the process of getting enough of the appropriate
information in a timely manner and usable form, and analyzing it so that it can have a
positive impact on business strategy, tactics and operations. BI applications allow users to
quickly and easily view data on essential metrics such as sales, inventory and customer
activities. This information can be dispersed through a dynamic interface, preferably one
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that is web-enabled. If a dynamic interface is implemented, users can explore the data
applications improve the relationship between the company and its customers. Timely
performance are aspects of CRM. With GIS, call center operators can access all the
containing information on outside plant infrastructure, signal quality, and equipment can
In CRM, Tier 1 handling means the customer's issue is resolved with the initial call. Tier
who have successfully implemented GIS support for CRM achieve higher Tier 1 handling
and customer service is performed more quickly and economically. With CRM contacts
at an all-time high, improving CRM operations can make a big impact on the bottomline
of a carrier. In the wireless sector, "churn" refers to the rate that customers jump from one
service provider to another. For many carriers, customer churn is the single largest cost
factor. GIS improves the speed and quality of contact handling, augments customer
MANAGEMENT
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just about every type of industry, call centers today are much more than cost centers.
Call centers helps the company achieve customer-centric objectives as well as provide
For many companies, call centers represent the principal link between their customers and
themselves. But for Airtel , it’s a Successful call center differentiate companies, directly
impact their annual turnover and competitive position, and are critical in achieving CRM
goals.
As a key element in CRM, call centers use three building blocks to satisfy their
customers:
People
Technology
Process.
People - The human element is probably the most important component in a call
center.
Technology - Call centers use network services to connect customers with the call
and Interactive Voice Response (IVR) systems; and IT products such as workstations,
Integration (CTI).
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Process - To make everything work harmoniously and cost-effectively, and to satisfy
CRM objectives, a series of processes are needed to define how systems and people
work together.
With the increased emphasis on customer service, the bar has been raised on customer
expectations. Customers expect 24x7 availability, as well as e-mail and Web integration.
Access and availability are among the keys to top-drawer customer service. But what
about the relationship of these three elements? For today's high-tech call center, people,
technology and process are truly integrated. The loss of any of the key elements - whether
RISKS TO PEOPLE
Successful call centers base their success on how well their staffs perform. If call center
staff members are unable or unwilling to perform their assigned tasks, the call center is at
risk.
RISKS TO TECHNOLOGY
Call center systems such as ACDs and IVR are at risk from fires, floods, loss of power,
system failure, component failure, loss of data (with no backups), vandalism, and human
error. Voice network services are at risk from cable cuts, power failures, security
routers, hubs, switches, and power supplies. Data network services, such as switched or
private circuits, or Internet-based services, face the same risks as voice networks.
hardware are the same as for telecom equipment, while human error, viruses, security
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RISKS TO PROCESS
various combinations.
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16 CRM STRATEGIES
How to acquire, strengthen, and retain strong customer relationships in the era
Principle 1: By knowing more about the customer value and anticipating relationship
needs better than when the customer was involved in a high-touch relationship.
Principle 2: Consolidate and make available all customer interaction information from all
channels/touchpoints
Principle 3: Develop a customer centric infrastructure that can consistently support the
profitable results
project engagements globally. The Model shows that the customer relationship is
time. The end result is a strong customer relationship, which lead to acceptable customer
loyalty, profitability and retention. Success criteria such as share of wallet, profitability
and cross-sell rations are also applied as part of the continous measurement to ensure that
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Technology
SOLVING
Metadata Management
High-End Servers
IT Infrastructure
Networking
Network & Systems
Data & Applications
Management
Internet
Web Warehouse
CUSTOMER
Security
Application Specific Data Model
ExternalIntegration Technologies
Data Providers
Operational Data Stores
Data Hygiene / Enrichment
Call Center & Messaging
Middleware
Cleansing & Conditioning
Householding
- Segment of One Marketing
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Customer Valuation
Customer Risk Analysis RELATIONSHIP
Profiling and Segmentation
Predictive Behavior Modeling
People & Activities
Targeted Marketing & CampaignManagement
Customer Contact Management
ADDRESSING A PRINCIPLES-BASED VALUE CHAIN
Customer Profile
Content
Business Management
Strategy
Catalogue Management
Business Process Reengineering
Change Management
MANAGEMENT
Project Management
- Application Implementation
- Data Warehouse/ Data Modeling
Warehouse Architecture
Logical, Physical Design
Channel Integration
INVOLVES
DB Implementation
- IT Infrastructure
IT Architecture
Network Design, Planning & Implementation
Network & System Management
-On-going Customer Support
CHURN MANAGEMENT
What are the commonest reasons for customers to switch from one service provider
to another?
poor performance,
Regarding churn, something interesting that’s been noticed is that it’s much higher in the
case of pre-paid services, with a churn rate of 8:1, than in post-paid service where the rate
is 3:1.
The idea of pre-paid cards is that the customer will mature to become a post-paid one and
so it pays to retain him too. After all, it’s five times more expensive to acquire a new
The industry standard is around 2 percent a month. The cost of acquiring a new customer
is more than that of retaining one. The cost of acquiring a new customer is more than five
times that of retaining an existing customer. Even if you calculate a churn of 2 percent a
month, an operator is losing 24 percent of its customers every year. Whatever the
numbers, the fact remains that the telecom industry’s bottom line is getting affected
WHY IT HAPPENS
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Usually, such a high churn rate is witnessed in more mature markets where operators try
to attract customers from competitors since market growth is saturated. But with one of
the lowest telecom penetrations, the Indian market is anything but mature. Then what are
Many subscribers shift to another vendor due to brand image. Beyond the brand image,
higher churn is generally attributed to the numerous tariff options available to customers.
A customer may also churn due to billing disputes with a particular vendor—billing fraud
also comes into play. More than tariff plans it is the quality of customer service that
prompts a customer to churn or remain loyal. In the current market scenario there is
hardly any difference in offerings, prices and quality of service offered by different
operators. Cut-throat competition has ensured that there is not much difference between
the tariff plans offered by different vendors. This is where customer service and value-
added services come into play. If an operator doesn’t anticipate market needs or does not
provide value-added services offered by the competitor, then the customer is likely to
churn.
Other than this, some of the key factors that encourage churn are inadequate network
coverage, which includes dropped calls that occur in places where network coverage is
thin and blocked calls that occur when the demand for network services exceeds capacity.
The churn problem is more prevalent in the prepaid segment, which today accounts for
the vast majority of Indian cellular users. The prepaid customer is more price-sensitive
than the post-paid one. With rentals as low as Rs 300, customers with low usage prefer
prepaid cards. Also, students and those who like to experiment with different networks
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Bharti Cellular reduced its churn from 3 percent to 2 percent with immense positive
impact on its bottom line after deploying the churn management solution SAS. Today,
they can predict with 80 percent confidence, which customer will churn. Internationally
they have reached accuracy levels of 90-95 percent. But customer variables keep
changing. Hence the solution has to be continuously fine-tuned to improve accuracy. SAS
offers a total end-to-end customer retention solution, which supports the whole process of
The solution enables an operator to gain a better understanding of the variables that
a 73 percent chance of his churning. The lower the score, the more content the customer.
Once the scores are known, it is easy to figure out which customers are likely to switch.
The solution provides the telecom company with a sliced and diced view of the customer
base, thereby empowering it to treat each customer differently as per needs. The customer
customer demographics, contractual data, technical quality data, billing and usage data
and events-type data. But the most commonly used historic variables include the time a
customer spends on air, the number of calls he makes and the revenue generated from that
customer.
The predictive information becomes crucial as it gives the service provider a window to
proactively fix the glitches in service and contain churn, thereby improving bottom lines.
The solution also helps identify cross-sell and up-sell opportunities, which can have a
further positive impact on the operator’s bottom line. Once they have identified the
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customers who are likely to churn they can take immediate measures to retain at least 85
percent of them.
Matching the right customer profile with the right marketing bundle creatively
MEASUREMENT FRAMEWORK
Methodology
Results
Matching the right customer profile with the right marketing bundle creatively
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COMPREHENSIVE APPROACH TO CHURN CONTROL IN HIGH GROWTH
Customer retention
Revenue stimulation
All these enhancements successfully changed the customer retention paradigm from a
reactive to a proactive one resulting in a continuous decline in postpaid churn over last
Branding and service differentiators also help in taking customers away from
competitors.
proper operational and analytical CRM tools in place that would help segment and
value ones.
For Airtel , Analytical customer retention solutions would help identify the high-, mid-
and low-value customers and the valuable ones who are most likely to cancel services,
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and their reasons for doing so. They would also help in better campaign targeting and a
more focused strategy.The multidimensional data base (MDDB) that Airtel has, let
internal sales and marketing groups research customer information from their desktops .
CUSTOMER ACQUISITION
Steps:
Customer acquisition
STRATEGIES:
Introduction of a new tariff plan with different slots like leisure lifestyle, executive and
premium for postpaid customers. AirTel also offers different tariff plans to different
Airtel has also implemented an e-CRM platform to create a central database of customer
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OTHER MEANS
The common services offered by the operator include SMS, group messaging, voice mail,
caller line identification, Hello tunes, GPRS and even multimedia messaging. Other than
this, different service providers have introduced unique services for certain segments of
Operators have also introduced closed user group (CUG) services for corporates that want
to provide employees with cell phones but also want to restrict their usage. Operators
even offer special pricing for calls made within a limited group.
Though m-commerce hasn’t taken off as expected, certain banks offer mobile banking
services like balance enquiry, cheque book requisition, bank statements, etc, free of cost.
CUSTOMER DEFECTION
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Customer-focused marketing technology is developing rapidly: The term “customer
database” is outdated. It has been found that companies, which reduced customer
defections by 5 per cent, could boost profits from 25 per cent to 85 per cent.
Today, the consumers are smarter and they expect more.As the general population
becomes better educated, consumers approach purchase decisions with greater scrutiny,
The Internet has led to disloyalty: The Internet as a distribution channel for product
sales and information has caused many consumers to change buying habits and methods.
Price-based switching: the customers prefer those services or products which are offered
to them at much competitive prices. Hence it has become very essential for the companies
The global market introduces new competitors: As the global economy opens, our
companies are seeing increased competition, and many sectors are facing foreign
6 TYPES OF DEFECTORS
Market defectors, who are lost but not to any other business - they may go out of
industry,
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Organisational defectors, who switch due to internal or external politics.
Analysing complaint and service data is a good method to identify problems and
understand why customers defect. Analysis should be statistical and should be fairly
Strategic bundling is another way of erecting a barrier against defections that can lead to
single cost saving and convenient package. A customer who opts for a bundle will not
switch to a competitor even if he is offered a better deal on a single item of the bundle.
Usage analysis is a method that can be effectively used to help in customer retention.
Segmenting markets by consumption can provide valuable insights into the mix of
customers. Heavy users are more valuable than the medium or light ones and appropriate
marketing strategies have to be devised to retain them. Similarly in the business context,
we find the Pareto Principle or the 80/20 rule in operation. Key accounts that comprise
about 20 per cent of the business customers are responsible for about 80 per cent of the
sales generated. Such heavy and key users are prone to poaching by competitors. Hence it
this segment. Medium customers should be targeted with revenue enhancement strategies
through phone calls and e-mails. The light or unprofitable customers should be served in
new ways to upgrade them. In some cases, the unprofitable customers might also have to
be ignored.
The strategies for retaining customers are a function of the nature of the product, the stage
of the product life cycle, and the buying behaviour of the customers.
Customer value affects customer satisfaction, which in turn affects loyalty. Customer
loyalty affects customer retention. Loyalty of the customer increases with customer
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satisfaction at an increasing rate. Segmentation of customers should be done by
Airtel is also trying to prevent its customers to its competitors such as: Hutch and Idea.
CUSTOMER RETENTION
Airtel maintains its leadership with its effective churn controls in India.
Gaining new customers is good news for any company, the flip side is the loss of
management systems in place, which can almost accurately predict the behaviour of
provider.
The cost of acquiring a new customer is more than five times that of retaining an existing
customer. Hence it is advisable for any company to try to reduce the churn rate of its
company.
The churn rate of Airtel is about 2% which is at parlance with the industry figure. But if
customers every year. Whatever the numbers, the fact remains that the telecom industry’s
bottom line is getting affected significantly thanks to the high churn rate.
Lifetime Value:
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Assessing proven methods to apply customer lifetime value to define customer CRC
CUSTOMER COMPLAINTS
When the customer pays for a product or service, it is assumed that the product will work
correctly or that the service received is as promised. Ideally, the customer will be
satisfied, and there will be no complaints. But at times, the customer is not satisfied with
the services since the expectations do not meet with the results, this causes customer
complaints.
Airtel has toll free numbers for handling customer complaints. A separate division is
meant for customer care, where, the customer care executives are present to handle any
type of customer complaint. These customer care executives are specially trained for the
same purpose.
Letters
Phone Calls
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NEED TO LISTEN TO CUSTOMER COMPLAINTS
Development
Loyalty
Lost Customers
Employees
Listen
Open Details
Friendly Staff
Comment Slips
Do Not Forget!
No matter how bad a problem is, no employee should be subjected to any personal insults
Encourage complaints rather than silence, but customers must not be allowed to threaten
INDICES
The ultimate indication of success of a CRM initiative is the change in attitude and
behavior that an organization exhibits toward its customers. To determine if the initiative
LOyalty and VElocity Index (Customer Love) has been done. The index's intention is to
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determine if the CRM initiative is successful from a quantitative view. Components of the
index are:
Marketing
Market share
Product positioning
Sales
Customer turnover (rate of new customers to departing customers and the active
Win rate
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Number of sales calls within a selling cycle
Customer service:
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18 CRM BUSINESS STRATEGY
In fact, Airtel has seen that CRM actually represents a business strategy that involves
and
prospect for the whole organization. Surrounding this business strategy is an information
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Today’s consumers’ can no longer be treated as a “homogenous collection of revenue
generating unitsӠ, but rather as individuals whose specific wants and needs determine
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BIBLIOGRAPHY
Books:
Magazines:
1. Destination CRM
2. Customer Contact World Magazine
3. Customer Interface
4. Customer Inter@ction Solutions Magazine
Journals:
Websites:
1. www.crmdaily.com
2. www.realmarket.com
3.www.crm2day.com
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