The Customer Relationship Model (CRM) model developed by the market research and consulting firm, Gartner Inc. is known as the Gartner’s CRM model. Gartner is a global consultancy company headquartered in Connecticut, the USA has more than 5700 associates 1400 research analysts and consultants (Grazdane, 2013).
The Gartner model has been constructed after assessing and profiling eight companies that were listed in the Fortune 500. These 8 companies were selected on the basis of their year-after-year revenue growth and high ranking in their respective industry. This model of CRM stresses on 8 competencies that a business should focus on (Gartner, 2001). The eight competencies, identified in the model, are CRM vision, CRM strategy, valued customer experience, organizational collaboration, CRM processes, CRM information, CRM technology, and CRM metrics.
Gartner’s CRM model gives great emphasis on creating a direction. Businesses aspiring to apply this model need to first inculcate a vision that creates space for customer management. Businesses that visualize effective CRM processes through inspirational leadership and well-defined customer based value propositions perform better in terms of revenue and customer satisfaction. As per the Gartner model, companies need to foster a customer-centric culture by increasing their social worth (Tahir & Zulkifli, 2011).
CRM strategy is another element of the Gartner model, which needs to be set prior to customer engagement. This requires building objectives related to customer management, segmentation, and value propositions. To become successful, the Gartner model states that an organization needs to understand the customer base it caters to and convert that information into an asset by effective value proposition delivery. The value proposition needs to include objectives, segments, as well as customer engagement goals, along with defining how resources are to be used to achieve the CRM strategy while interacting with the customers (Labus & Stone, 2010).
Valued customer experience
Customer experience deals with creating a positive brand image, which is a long-term goal for a business. It focuses on customization of services based on experience (Das & Mishra, 2019). Positive experiences lead to gratitude and long-term associations and negative experiences warrant effective remedial efforts to change to positive. To have a valued experience history, a business should be agile and focus on getting customer feedbacks (Abdul-Muhmin, 2012).
Customer experience should be measured to make sure that the propositions are able to create value (Grazdane, 2013). For this, assessment of requirements and expectations need to be done through customer engagement. The Gartner model also explains that the company needs to balance its value proposition through an assessment of customer satisfaction. However, it also needs to make sure that it does not hinder its competitive practices.
Gartner’s model explains that through the transformation of culture, businesses can create goals that are customer-oriented. Moreover, the inclusion of ideas from staff, suppliers as well as partners ensure that all stakeholders are in agreement towards the plan of delivering what the organization’s value proposition has offered. Through this, the business is sure to achieve acceptance from workers and enhanced collaboration for customer management (Starkey & Woodcock, 2002).
Customer management involves taking care of the customer life cycle. It also takes into account analysis, planning and application of knowledge management towards customer engagement. The CRM processes in Gartner’s model relate to solutions that tie the whole CRM network together. This makes it a part of every department, rather than being a single detached aspect of one department. Businesses
Information from different customers is different which needs customised solutions; however, a unified CRM solution is important. Thus, there is a need to have a system which filters valuable customer-related information from unimportant ones. According to the Gartner’s model, stress is laid on gathering quality data that can aid decision-making in business and process development. Thus it requires analysis of data to create, maintain and leverage understanding of customers into developing relations with them (Abdul-Muhmin, 2012).
Gartner’s analysis of the eight Fortune 500 companies has shown that successful businesses use information technology to leverage their knowledge of data to develop customer-centric strategies (Gartner, 2001). What most of the businesses lack is effective IT technology that connects large volumes of data to come up with customer-centric solutions. The inclusion of technology and IT changes the business model immensely in various settings. Thus, according to this model, when businesses have better technology, they are able to reach the top in its niche industry (Venturini & Benito, 2015).
According to the Gartner’s CRM model, tracking success and failure through internal and external measures is important. This is because it provides an understanding of improving customer-based value propositions, service delivery, and customer loyalty. The model states that as businesses begin to establish elements that measure the success of value proposition and service delivery, they can identify areas that need improvement. Conversely, through this approach, they can also assess areas where they over deliver, and can then work on cutting back resources for time- and resource-based savings without negatively affecting customer loyalty (Shukla & Pattnaik, 2019).
Limitations of the Gartner’s CRM model
The Gartner’s CRM model is known for its granularity and specificity as per the enterprise it caters to. The eight blocks of the model provide an understanding of how customers get associated with a business then customize it. This model, however, is more specific towards bigger enterprises as compared to smaller businesses. However, it can be appled to the mentioned blocks to create and sustain a good customer relationship management plan.
- Abdul-Muhmin, A. G. (2012). CRM technology use and implementation benefits in an emerging market. Journal of Database Marketing & Customer Strategy Management, 19(2), 82–97. https://doi.org/10.1057/dbm.2012.13
- Das, S., & Mishra, M. (2019). The Impact of Customer Relationship Management (CRM) Practices on Customer Satisfaction. In Business Governance and Society (pp. 43–54). Cham: Springer International Publishing. https://doi.org/10.1007/978-3-319-94613-9_4
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- Grazdane, I. (2013). A Customer Relationship Management Approach for Optical Retail Business. Helsinki.
- Labus, M., & Stone, M. (2010). The CRM behaviour theory – Managing corporate customer relationships in service industries. Journal of Database Marketing & Customer Strategy Management, 17(3–4), 155–173.
- Shukla, M. K., & Pattnaik, P. N. (2019). Managing Customer Relations in a Modern Business Environment: Towards an Ecosystem-Based Sustainable CRM Model. Journal of Relationship Marketing, 18(1), 17–33. https://doi.org/10.1080/15332667.2018.1534057
- Starkey, M., & Woodcock, N. (2002). CRM systems: Necessary, but not sufficient. REAP the benefits of customer management. Journal of Database Marketing & Customer Strategy Management, 9(3), 267–275. https://doi.org/10.1057/palgrave.jdm.3240008
- Tahir, I., & Zulkifli, Z. (2011). A Preliminary Analysis of CRM Practices among Banks frome the Customers’ Perspectives. Journal of Public Administration and Governance, 1(1), 274–285.
- Venturini, W. T., & Benito, Ó. G. (2015). CRM software success: a proposed performance measurement scale. Journal of Knowledge Management, 19(4), 856–875. https://doi.org/10.1108/JKM-10-2014-0401