First, a brief history.

In the early half of the 20th century, mass manufacturing was the way to riches. Increased liberation and growing disposal income pushed up consumer demands for almost everything rolled out from production lines. Ford automobiles were sold out, all in one color; black.

Rapid industrialization during the post-war era pushed competition to new height. Producers began to pay closer attention to customer relations.

The watch word in the 80’s was; as Tom Peter put it gallantly “customer, customer, customer”. For the first time, intense competition in almost every sectors were forcing producers and retailers to look for ways to attract new customers and retain existing one. Product quality alone was no guarantee to success.

It set forth the new era of customer relation management.

Today's, CRM experts categorizes 8 areas where CRM is highly engaged:

1)Retail sector: Global retail giant like TESCO and BOOTS have customer loyalty cards to help them increase customer value through added activities such as newsletter, promotional catalogs etc.

2)Automobile: Today, top automobile brands have to consider "romancing" their prospects into putting brand value into the consideration basket. Once a purchase is made, users are constantly reminded of the philosophy and values of the brand, the very reason they bought the car in the first place.

3)Pharmaceutical: Many brands cannot identify their target customer. CRM is used to recognize the user group and to drill in the health talks into a particular brand.

4)Beauty and Cosmetic: Fierce competition forces producer to resort to CRM to retain user base. CRM is used to relate certain beauty attribute with the hope that it clearly identify with the users' mind.

5)Hotel and Leisure: Frequent Flyer Program is one of the key driver to motivate a customer to choose a particular airline over another.

6)Telco: Service has become parity in this industry. The only way is through brand association such as age and style attributes.

7)Banking: Because the top 20% of the customers provide 80% of the bank total revenue, little wonder why banks are so particular about CRM.

8)Insurance: Insurance is profitable for the customer's life time value. Therefore, CRM is critical to constantly identify changes in the client's risk management needs and requirement..

Stages Of Development

First came the offering of membership card with privilege shopping benefits, early bird discount, free mails, newsletters, catalog etc.

Next came the point system where shopping points were attached with purchases made; and the accumulated points can be used to redeem for gifts or exchange for items in the store

After that cash reward is offered to shopper (ShopnReward System). Here, shoppers are offered cash reward corresponding with their shopping value.

Is this good enough?

No!

Today ShopnReward system has gone beyond basic single tier reward. Two tiers reward system is now common amongst retail stores. In this way, retailers hope to attract new customers through existing customers through words of mouth marketing strategy. In other words, multi-level network marketing is today's new competitive strategy to stay relevant.

To accomplish this new strategic move, a complex and relatively large data-base system is required. Furthermore, it has to be ON-LINE & REAL-TIME 24H365D.

This is where the cost factor becomes some what unbearable for smaller players.

... this is a BIG reason why Armstrong Affiliates are spoiled lots.!