Customer Relationship Management in the Agricultural Machinery Market

Introduction

As agribusiness made rapid strides and developed, it was accompanied by a visible explosion in technification and mechanization in the agricultural sector, which stimulated a greater degree of competitiveness in the agricultural machinery market. Therefore, the agricultural equipment dealers appreciated the importance of knowing and retaining their clientele. Giant companies from all the economic sectors are recognized for their customer retention and high profitability.

In terms of the marketing strategies, the prevailing product quality and price may not be adequate differentiators to facilitate gaining or maintaining a customer, justifying the birth of managing a relationship with a customer or Customer Relationship Management (CRM).

CRM is; therefore, interpreted as a business approach to understand and impact customer behavior through relevant communications, in order to enhance their purchases, retention, loyalty, and profitability. CRM can be interpreted as a company policy with the aim of knowing and modifying the desired relationship with the customers, in order to make the right recommendation at the right time for the right customers. Another way to understand it is as a process of attaining and systematizing the details of the customers' particulars with the aim of knowing them better and categorize them under various degrees of profitability for the company. CRM includes a technological slant and many software companies employ this expression to trade their information, customer, and marketing management systems.

Unquestionably, the objective for implementing CRM is the appreciable growth in company performance which is a characteristic of marketing strategies. Without losing sight of this goal, the company must first systematize its efforts to improve its understanding of its customers with the intention of attracting, influencing, maintaining, enlarging the number, and retaining its most prized customers, who assume a bigger part than they did earlier.

According to Payne, CRM is a holistic strategic method of managing customer relationships to build shareholder value. PAYNE also purported that CRM opens up more options for utilizing the data and particulars to foster a clearer understanding of the client and thus being able to more satisfactorily effect these relationship marketing strategies; however, this interpretation does not limit CRM to being merely a database system or technological tool.

As the term CRM was initially understood to be a mere technological solution, Payne presented the statistics given here: 60% of CRM projects end in failure, 70% of the CRM initiatives will be unsuccessful in 18 months and 69% of CRM projects will negligibly or not at all influence the business results. In this context, the author suggested that to succeed in implementing a CRM project, the entire company must possess total commitment, and be focused on the strategic vision of building shareholder value. This is accomplished by expanding the tactical customer relationships, by combining the inherent power of information technology and Relationship Marketing techniques to consolidate and maintain long-term and rewarding relationships.

According to Strauss and Frost, the main reasons for CRM to fail are: (i) the assumption that the technology itself is the solution; in fact, technology is relevant only if it is combined with strategic thinking; (ii) absence of managerial support arising from the paucity of information regarding the opportunities afforded by CRM; (iii) deficiency of customer-oriented culture; (iv) dearth of a clearly-outlined master plan and goals; (v) lack of a process redefinition ; (vi) insufficient information and low quality of data; (vii) faulty control of the processes of change at all levels of the company; and (viii) detached behavior of those employing the system (CRM).

The rapid technological development supplies an increasing number of tools that enables the company to develop a better understanding of the behavioral patterns of its clients, apart from gaining insight into their needs and inclinations. Having this information, it is the responsibility of the company to modify and employ these tools to customize the marketing offers to suit each customer sector.

Although the agricultural sector is still highly traditional, updating and investing was done for the companies of the branch, and the information was gathered and organized to optimize the results. However, obstacles are still present that hinder the definition and implementation of CRM in the companies linked to the agricultural machinery sector, and the reasons are listed: 1) most often the farmers are hesitant to collect the information; 2) insufficient knowledge regarding the company and difficulty in identifying information that is pertinent to their business and its application at a later point in time; 3) poorly trained sales staff and/or staff who are unable to obtain, systematize and use this information; 4) absence of software specifically tailored for the resale of agricultural machinery and lack of a database related to these dealers.

This article aimed to highlight the significance of customer management, incorporating the idea of managing customer relationship in the context of reselling the agricultural machines, with the sole intention of retaining the clients and escalating the profitability of these companies.