CRM - Presentation - Group 6 (13.12.24)_Final with edited.pdf

GROUP - 6
MANAGING
C U S T O M E R P E R C E I V E D V A L U E
CHAPTER - 5
Date: 13 December 2024
Presented by
Group (6), EMBA 20th Batch (Online)

Group (6) Members
Lei Yee Soe
EMBA II - 70
Lei Yee Soe
EMBA II - 70
Tin Tin Thein
EMBA II - 77
Tin Tin Thein
EMBA II - 77
Thinn Moe Phyu
EMBA II - 62
Thinn Moe Phyu
EMBA II - 62
Soe Thura Nyein
EMBA II - 57
Soe Thura Nyein
EMBA II - 57
Kyaw Thura
EMBA II - 80
Kyaw Thura
EMBA II - 80
Thein Shwe
EMBA II - 64
Thein Shwe
EMBA II - 64
Nay Nwe Mra
EMBA II - 48
Nay Nwe Mra
EMBA II - 48
Khin Wah Wah Kyaw
EMBA II - 32
Khin Wah Wah Kyaw
EMBA II - 32
Nan Aye Aye Moe
EMBA II - 42
Nan Aye Aye Moe
EMBA II - 42
Phyo Myat Thu
EMBA II - 78
Phyo Myat Thu
EMBA II - 78

Contents
1. Introduction
2. Benefits Less Costs
3. Goal Achievement/Non-Achievement
4. Customer Experienced Value
5. Driving Excellence Through Innovation and Quality
6. The Value Preposition
7. Value from processes
8. The Company’s Operations – Choosing the Right Path
9. Customization in Shoe Manufacturing
10. Conclusion
Tin Tin Thein
Slide - 3

Introduction
CUSTOMER PERCEIVED VALUE
1. What is CPV:
 the customer's evaluation of the benefits
received versus the costs incurred in
acquiring a product or service.
 a central theme in understanding why
customers choose one company over
another and remain loyal.
Communication
is key
Communication is the
cornerstone of any
successful relationship.
2. Two Perspectives of Value:
 Value-in-Exchange: The transactional
value of goods or services provided.
 Value-in-Use: The value experienced by
customers during and after usage of a
product or service.
3. Strategic Importance of CPV:
 By managing perceived value, companies
can increase customer satisfaction, loyalty,
and profitability.
 CPV guides the creation and delivery of
superior value propositions tailored to
customer needs.
4. Key Touchpoints:
 CPV spans across all interactions with the
company, including advertising, customer
support, sales, and product usage.
Tin Tin Thein
Slide - 4

Noise
• Convenience: Easy-to-navigate platform and mobile app for
shopping anytime.
• Trust: Authentic products, reliable delivery, and cash-on-
delivery payment options.
• Affordability: Competitive pricing, flash sales, and
discounts.
• Personalization: Recommendations and wish lists tailored
to customer preferences.
• Engagement: Marketing campaigns and loyalty programs
that keep customers involved and incentivized.
• Creating Superior Customer Value
(Accessibility, Ease of Use, Affordability)
• Communicating Superior Customer Value
(Effective Marketing, Trust Building)
• Overcoming Noise
(service quality, extensive agent network, brand reputation)
• Building Relationship Stability and Development
(loyalty, QR code usage)
• Convenience: Seamless financial transactions via mobile.
• Cost Efficiency: Cashback and discounts increase perceived
value.
• Trust: Strong brand reputation and robust security
measures.
• Customization: Language support and features tailored to
local needs.
• Innovation: Continuous updates and integration into
everyday services.
Introduction (cont’d)
Figure 5.1 - Company-supplied stimulus, noise and customer
perceived value
Customer
perceived value
(CPV)
Company-
supplied stimulus
Tin Tin Thein
Slide - 5

Objectives
To explore the differences between value-in-
exchange and value-in-use.
To analyze how the marketing mix (product, price,
place, promotion) communicates and delivers CPV.
To examine the role of a company's operations and how
they influence CPV.
To learn strategies for effectively delivering value to
customers and maintaining competitive advantage.
(open-ended inquiry)
(Logical breakdown and critical evaluation)
(Close observation or inspection)
(Acquisition of knowledge or skill)
To understand the concept of customer perceived
value and its strategic implications.
(Outcome of comprehension)
Tin Tin Thein
Slide - 6

Benefits less costs
The difference between the benefits and costs from the customer's
view point.
 Helps companies identify and align product features with customer needs.
 Enables competitive analysis.
Positive : Benefits > Costs
Negative : Costs > Benefits
Neutral : Benefits = Costs
Khin Wah Wah Kyaw
Slide - 7

Customer Perceived Benefits
Five Types of Benefits (Sheth’s Framework)
Functional Benefits
Relate to the capabilities and performance of products/
services (e.g., an iPhone working flawlessly)
Conditional Benefits
Refer to the context or situation (e.g., ice cream sales
peaking in warmer months)
Social Benefits
Improve social status or group association (e.g., buying an
upmarket house)
Emotional Benefits
Associated with emotional experiences (e.g., joy from a
concert)
Epistemic Benefits
Arouse feelings of curiosity and desire for knowledge (e.g.,
reading a book to understand CRM).
Khin Wah Wah Kyaw
Slide - 8

Customer Perceived Costs
Time Costs
Emotional Costs
Physical Costs
Perceived Risk
Time is a finite resource; convenience often valued
(e.g., higher prices at service stations).
Stress and frustration from purchasing decisions
(e.g., reluctance to switch banks).
Physical effort required
(e.g., traveling long distances).
Risks related to performance, physical, financial,
social, and psychological factors.
Adaptation/ Switching Costs
Costs of reconfiguring existing assets
(e.g., implementing a new finance package).
Khin Wah Wah Kyaw
Slide - 9

Goal Achievements/ Non-Achievement
When customers buy a product, address a need or a want, is a goal.
What customers value can be looked at in two ways,
Customers see value in a product or service if it helps them achieve what they want or need
(their goals)
Achieving Goals
Customers also look at the value by comparing the benefits they get (like quality or
convenience) with the costs they have to pay (like money, time, or effort).
Benefits Minus Costs
This perspective leads to view:
Goal Achievement (for e.g. - buying the desired iPhone the store has sufficient stock on hand for
the customer to succeed in their purchase buying the desired iPhone).
High Perceived Value
Goal Non-Achievement (for e.g. – the store is by the time the customer enters the store - out-of-
stock disappointment).
Low Perceived Value
Partial Goal Achievement.
Neutral Perceived Value
Nay Nwe Mra
Slide - 10

Other Customer Perceived Value
Conceptualizations
Zeithaml identified four different forms of
customer perceived value:
Price-savings, service excellence, time-savings, choice
Functional Value
Pleasure, fun, entertainment, interaction, escape
Hedonic or Affective Value
Functional vs. Hedonic Value
Value as low price
Value as delivery of what the customer wants
Value as the quality: price ratio
Value as the give: get ratio
(what customers receive vs. sacrifices made)
Nay Nwe Mra
Slide - 11

Holbrook's Typology of Consumer Value
Holbrook argues that all eight types of value tend to occur together to varying
degrees in any given consumption experience.
 It’s important for a company to adopt an interpretation that aligns with its
Customer Relationship Management (CRM) strategy.
 Aligning the concept with the CRM strategy helps the company:
 Define what value means to their target customers.
 Develop strategies to meet customer needs and expectations effectively.
These three dimensions give rise to eight types of consumer-experienced value:
Nay Nwe Mra
Slide - 12

Customer Experienced Value
– When Do Customers Experience Value?
Value-in-exchange
1.
Value-in-use
2.
 Two fundamental ways to experience value:
 Customer perceived value = External stimulus + Customer perception
Kyaw Thura
Slide - 13

Value-in-Exchange
 Trading one form of value for another
(e.g., money for a product or bartering).
 Focuses on the transaction as the moment of realized
value.
 Emphasizes product features/attributes as key to
customer perceived value.
 Encourages a short-term perspective (transactional
focus).
Kyaw Thura
Slide - 14

Value-in-Use
 Value is realized when customers use, consume, or
interact with a product.
 Goods have no value until utilized by customers.
 Focuses on benefits customers gain, not what
producers provide.
 Recognizes CX throughout the entire customer
journey.
 Acknowledges the dynamic nature of context and
customer perceptions.
Kyaw Thura
Slide - 15

Customer Experienced (CX) Value
 Combines value-in-exchange and value-in-use for a
holistic view.
 These interactions define customer-experienced value.
Example:
 Buying a discounted TV (value-in-exchange).
 Using the TV's features (value-in-use).
 Selling the TV later (value-in-exchange).
BOTTOM LINE
CUSTOMER EXPERIENCE
Kyaw Thura
Slide - 16

Driving Excellence Through
Innovation and Quality
 Product/Service Innovation
 Incremental Benefits
 Product-Service Bundling
 Service Quality
 Service Quality Theories
Nan Aye Aye Moe
Slide - 17

 Drives differentiation and customer loyalty.
 Examples: Cutting-edge features or tech-driven services.
Product/Service Innovation
Product/ Service Innovation
Incremental Benefits
 Continuous small improvements lead to sustained value.
 Example: Regular updates in subscription services (e.g., Netflix).
Nan Aye Aye Moe
Slide - 18

 Integrating products and services for convenience and value.
 Example: Smartphones with complimentary support plans.
Product-Service Bundling
Product-service bundling
Service Quality
 Key dimensions: Reliability, Responsiveness, Empathy,
Assurance, Tangibles (SERVQUAL).
 Drives customer loyalty and retention.
Nan Aye Aye Moe
Slide - 19

 Grönroos Model: Functional and technical quality.
 SERVQUAL: Gap model for assessing service quality.
Theories
Service Quality and Service Quality Theories
Practical Implications
 Focus on continuous improvement, bundling strategies,
and superior service design.
 Call to Action: Embrace innovation and quality to thrive
in competitive markets.
Nan Aye Aye Moe
Slide - 20

Grönroos Model
Source: Grönroos (1984) Nan Aye Aye Moe
Slide - 21
Nan Aye Aye Moe
Slide - 21

SERVQUAL
Figure 5.3 The SERVQUAL gaps model
MANAGING CUSTOMER PERCEIVED VALUE
Nan Aye Aye Moe
Slide - 22
Nan Aye Aye Moe
Slide - 22

VALUE PROPOSITION CANVAS
The Value Proposition
A value proposition is a statement that explains how a
product or service can help a customer and why it's the
best choice over competitors.
Key Components of a
Value Proposition
 Target Market
 Problem
 Unique Solution
 Benefits
 Differentiation
Myat Thu
Slide - 23

The role of the brand
CUSTOMER PERCEIVED VALUE
What is a Brand?
 A unique name, design, or symbol that differentiates products from
competitors.
 Conveys the company’s value proposition.
Why Are Brands Important?
 Reduce Risks & Costs: Help customers identify quality and make
confident decisions.
 Assurance of Experience: Offer a consistent, reliable customer
experience (e.g., Virgin for service excellence, Apple for innovation).
How Do Brands Build Perception?
Key Benefits of a Strong Brand
 Reduce Risks & Costs: Help customers identify quality and make
confident decisions.
 Assurance of Experience: Offer a consistent, reliable customer
experience (e.g., Virgin for service excellence, Apple for innovation).
 Simplifies decision-making for customers.
 Differentiates the company in a competitive market.
 Creates memorable associations (e.g., Microsoft, Google, Hyundai).
Myat Thu
Slide - 24

The role of the brand (cont’d)
Conclusion
Brands are powerful tools that communicate value, foster trust, and influence
customer decisions, ensuring loyalty and market success.
Myat Thu
Slide - 25

The Marketing Mix
1. What is the Marketing Mix?
 A strategic framework to analyze and deliver value to customers.
 Originated in the 1960s with 4Ps and later expanded to 7Ps for services.
2. The 4Ps Framework (Tangible Products)
 Product: What the company offers.
 Price: The cost customers pay.
 Promotion: How the company communicates with its audience.
 Place: Distribution channels to deliver the product.
3. The Expanded 7Ps (Services)
 People: Employees and their impact on customer experience.
 Physical Evidence: Tangible elements supporting the service (e.g., store layout, branding).
 Process: Systems and workflows ensuring consistent delivery.
4. Why is the Marketing Mix Important?
 Each element is a lever that shapes customer perception and behavior.
 Acts as a signal for the company’s value proposition, creating alignment with customer
expectations.
Myat Thu
Slide - 26

Key Takeaway
The marketing mix enables businesses to align their
offerings with customer needs, ensuring a strong,
consistent value proposition for products and services.
Myat Thu
Slide - 27

Value from processes is set of inter-related activities
performed by people and/or technology to achieve
outcome. Every step in the customer journey, from
initial interaction to post-purchase support.
Processes are more than simply workflow; they use
and deploy resources and assets that help firms
compete more effectively and create more value for
both customers and company.
Xerox has identified 14 key domains where business
processes are important, as Table. Many impact CX or
value perceptions, and encompass customer
engagement, market management, product
maintenance, and product design and engineering
processes.
Table 5.5 Xerox’s 14 key domains
that use business process
1. Customer engagement
2. Inventory management and logistics
3. Product design and engineering
4. Product maintenance
5. Technology management
6. Production and operations management
7. Market management
8. Supplier management
9. Information management
10.Business management
11. Human resource management
12.Leased and capital asset management
13.Legal
14.Financial management
Thein Shwe
Slide - 28

Process innovation
Process innovation can significantly enhance customer-
experienced value. e.g., First Direct started out as telephone bank
with no branch network, with customer service originating from
several call centers.
First Direct now offers banking through other channels – online
and app – has developed relationships with non-bank service
providers such as Apple Pay, Android Pay and Samsung Pay.
The bank’s customer satisfaction ratings have been consistently
higher than competitors who have branch operations.
Thein Shwe
Slide - 29

Value from People
The company’s individuals and teams who interact with
customers before, during, after purchase.
Major source of customer perceived value, especially in
professional services such as counselling, consulting &
coaching.
More important job in CRM is the customer contact role,
CM boundary-spanning role, between organization & its
external customers.
Two fundamental roles information management and
relationship management. What are customer’s
requirements, expectations, and preferences? Collect. >
CR
Thein Shwe
Slide - 30

Value from Physical evidence
Especially important for service companies with service-heavy
offerings.
Physical evidence are tangible facilities, equipment, and
materials that companies use to communicate value to
customers.
Physical evidence includes a company’s premises, and their
internal and external environments, print materials, websites,
apps, corporate uniforms, and vehicle livery.
Thein Shwe
Slide - 31

The Company’s Operations –
Choosing the Right Path
 Represents the customer promise and sets
expectations through the company’s marketing mix.
 Delivering on this promise requires alignment
between the company’s capabilities and the value
proposition.
Value Proposition
Customer Relationship Managem
Value proposi
Thin Moe Phyu
Slide - 33

Three Approaches for Value Creation
Operational Excellence Product Leadership Customer Intimacy
 Focus on efficiency, low
costs, and reliability.
 Examples: Walmart,
McDonald’s, Toyota, and
Amazon.
 Characteristics: Lean
operations, efficient supply
chains, quality control, and
convenience.
 Offers superior products,
services, or experiences.
 Emphasizes continuous
innovation and high R&D
investment.
 Examples: Apple, BMW,
3M, and Singapore Airlines.
 Culture of risk-taking and
innovation.
 Adapts offers to individual
customer needs, delivering
personalized solutions.
 Examples: Saatchi & Saatchi,
McKinsey, and Nordstrom.
 Requires deep customer
insight and customization.
Thin Moe Phyu
Slide - 34

 CRM systems gather and analyze customer data to enable
precise customization.
 Accurate CRM data increases the likelihood of offering value
propositions that align with customer needs.
Role of CRM Systems
Customization as a Key Element
Challenges
 High costs due to loss of economies of scale and the need for
extensive design, development, and testing.
 Requires potential reconfiguration of business processes and
new suppliers.
Definition: Tailors value propositions to specific customer
requirements.
Thin Moe Phyu
Slide - 35

 Common where the company has few, powerful customers.
 Cost-benefit analysis is essential to determine feasibility.
Applicability of Customization
CRM’s Role
 Helps assess the viability of customization by analyzing
customer data and aligning operational capabilities with
customer needs.
Thin Moe Phyu
Slide - 36

Key questions for CRM practitioners
considering customization include:
Do customers want customized
products and services?
What degree of customization
do customers desire?
Will customers pay a premium
for customization?
How do you take advantage of
the disruptive nature of local
manufacturing?
Thin Moe Phyu
Slide - 37

 Consumers appreciate the benefits of customization,
especially better fit, followed by style and functionality.
 Many are willing to pay a premium, with women being
particularly inclined.
 Willingness to pay varies across brands and segments (e.g.,
Adidas charges a 50% premium for customized shoes).
Customer Awareness and Value:
Customization in Shoe Manufacturing
Cost Implications:
 Customization doesn't always mean higher prices; dropping
unnecessary features can reduce costs and prices.
Lei Ye Soe
Slide - 38

Mass Customization:
Definition Implementation Forms
Tailoring value propositions
at scale by balancing
economies of scale with
individual customization.
Flexible processes allow base
components to be produced
efficiently while offering
variations to meet diverse
customer needs.
Ranges from simple "match-
to-order“ (matching
customer needs with
standard products) to
"engineer-to-order" (co-
designing unique solutions
with customers).
Lei Ye Soe
Slide - 39

Table 5.6 Forms of mass customisation
Lei Ye Soe
Slide - 40

Market Context Cost Implications Technology and
Advancements
 Commoditization works when the
company is the only supplier with
many customers.
 Customization is crucial when there are
few customers or in highly competitive
markets.
 Mass customization is ideal where
many customers and suppliers exist,
combining cost advantages with
differentiation.
 Customization doesn't always mean
higher prices; dropping unnecessary
features can reduce costs and prices.
 Technologies like 3D printing enable
cost-effective and customer-specific
production.
 For example, aerospace uses 3D printing
for lightweight and efficient component
designs.
Lei Ye Soe
Slide - 41

C A S E I L L U S T R AT I O N 5 . 3
Nike: Offers personalization through "Nike By You" and
"NIKEiD" programs.
Ralph Lauren: Customization via "The Polo Custom Shop."
Paris Miki (Eyewear):
 Uses customer images and design systems to
recommend frame styles.
 Customers and opticians collaboratively tweak designs.
 Finished eyewear is created in-store within an hour.
Mass customization leverages technology to meet diverse
customer needs while maintaining cost efficiency, making it
an increasingly viable strategy across industries.
Lei Yi Soe
Slide - 42
RETAIL BRANDS AND MASS CUSTOMISATION

Conclusion on CRM
Effective Customer Relationship Management (CRM)
integrates strategic, operational, and analytical dimensions.
Modern CRM extends beyond technology to focus on delivering
exceptional customer experiences (CX) through aligned
processes, people, and tools.
With evolving trends like AI, Big Data, and customer-centric
strategies, CRM is pivotal in enhancing customer satisfaction,
loyalty, and profitability.
Challenges remain in balancing technological integration with
human-centric approaches, emphasizing the importance of
tailored value propositions.
Soe Thura Nyein
Slide - 43

Discussion Questions
How can businesses effectively balance technological
advancements in CRM with maintaining a human-centered
approach to customer engagement?
What role do customer feedback loops play in refining CRM strategies?
How can organizations ensure their value propositions resonate with
diverse customer segments in a globalized market?
By integrating CRM technologies to enhance rather than replace
human interactions. For example, AI-powered chatbots can handle
routine queries, allowing customer service representatives to focus on
complex issues. Personalization through data analytics can maintain a
human touch by tailoring experiences to individual preferences.
Feedback loops help businesses understand evolving customer needs, pain
points, and satisfaction levels. They enable continuous improvement in CRM
processes by providing actionable insights that can enhance customer
experiences and loyalty.
By leveraging customer data analytics to segment markets based on
cultural, economic, and behavioral differences. Companies should
adopt localized strategies and ensure that their messaging aligns
with the unique needs and expectations of each segment, while
maintaining a consistent global brand identity.
Soe Thura Nyein
Slide - 44

Group-6
THANK YOU
F O R Y O U R A T T E N T I O N
Presentation - CRM
Thank you for your attention today. We hope
this presentation has provided valuable
insights into the benefits of CRM.
Soe Thura Nyein
Slide - 45

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