Strategic Influence of Customer Relationship Management as a Competitive Strategy in Motor Industry in Nairobi County

Abstract

Customer relationship management as a competitive strategy is a necessary consideration for a firm to remain ahead in the market place. The motor industry encounters stiff competition as competitive strategy of cost leadership, differentiation and focus is adopted by most firms. Gronroos, (2000) defined CRM in service marketing as a communicating process between customers and an organization's service in order to attract and maintain those customers who will be the organization's true customers who are willing to use the organization's services. The motor industry is not an exception in the market place. The firms must gain a broader understanding of the importance of CRM function in their business. The market place is growing with increasing customer demands that are knowledgeable and have variety of options. As such organizations need to adopt strategies that will enable them to have competitive edge over their rivals. In today’s highly competitive environment firms need to enhance their competitive edge by adopting various strategies that are customer oriented. To be customer oriented business the customer needs have to take priority (Abratt & Russel, 1999). The objective of the study was to establish use of CRM as a competitive strategy in motor industry in Nairobi County. The other objective was to determine how automobile industry uses CRM as a competitive strategy to retain customers.The research design was a census survey. The researcher used an interview guide as the primary data collection tool. The data was analyzed using descriptive statistics .Inferential statistics analysis was used for in depth probing of the information. The study found that CRM as a strategy and customer retention were appreciated in the motor industry. The findings indicated deliberate use of CRM as a competitive advantage was moderate in this industry. It was noted that less than 50% of the firms interviewed have put in mechanisms to measure customer retention and ensure customer retention. The study found out the lack of CR departments in most of the firms in the motor industry slows down the customer relationship management. Organizations that have not embraced Customer Relationship Management as a competitive strategy to do so for sustained growth and long term benefits to their firms .The study recommends that companies should set up CR departments and leadership of the firms should be involved in CRM function. There is need to incorporate CRM as part of the firm’s strategy when formulating strategic plan for the firm.