Customer Card as a Tool for CRM in the German Textile Industry (PDF)

Bachelor Thesis from the year 2016 in the subject Business economics - General, grade: 2,0, University of Applied Sciences Essen, language: English, abstract: This thesis analyses the topic customer card in the context of CRM but with specific reference to the German Textile Industry.

According to history Henry Ford mentioned with the introduction of the "Modell T" in 1908 that every customer could choose the colour of the car by himself as long as the chosen colour was black. He did that because black was easy to work with. Because of the non-existing competition during this time, companies did not have to operate towards consumer needs and were able to focus on the goods they produced.

Mass marketing was developed to reach out for as many customers as possible to sell the maximum amount of goods. In the late 1960s the quality of products became similar which changed the competitive situation. Companies were forced to differentiate from each other by creating customer benefits. Because of the rising variety, consumers started asking for products fitting their needs. New technology led to machines that were able to produce different types of products and mass customizing was born. To be able to individualize a product, a lot of information concerning the customer, needs to be collected. This process is called customer integration. Mass customizing has a one way communication from consumer to company. To create a dialog relationship, marketing was developed. The aim was to build a long-term relationship between company and customer, so that both sides generate a benefit. A rising profitability and a longer business relation were responsible for higher profits. Research led to the result that it is about seven times cheaper to keep a customer than generating new ones. According to further results, an increase of 5% in customer relationship can enable a profit increase between 20% and 120% by cross- and up-selling actions. Customer Relationship Management (CRM) describes this relationship process between a company and its customers. During the time of the relationship, customers are supposed to be bound to the company for as long as possible, so that they will not migrate to a competitor.

Different CRM-tools have been developed to achieve that goal. A common one is the customer card program. In Germany there are approximately up to 200 million customer cards in use at the moment.