CHAPTER I: INTRODUCTION

Introduction

With the recent changes in the global economy there been the rapid increase in the number of middle size retailer competitors therefore CRM one of the important issues for organisations to be taken in the count for competing in the retailer market industry.

CRM provides a quick and efficient way for people to communicate within an organisation as it has made the distribution of information and ideas between departments.

The study oriented around CRM. Our study aimed to build an

empirically grounded framework of the initiation stage of CRM in retailing. The main

result of this study indicates that CRM may be an effective element to CRM strategy, if customer relation is based on permission marketing and trust. By collecting and

maintaining useful information through data mining from the customers’ database, stores can offer their customers interesting services via new strategy by using technology and can retain customers with different ways and maintain fruitful relations with their customers based on trust.

Aim of the study

  • The aim is to research and investigate how customer relationship management support, help Lidl to achieve growth and to provide the best customer services by using  technology and improving the company structure in UK.

Objectives of the study

  1. Define CRM in retail contest
  2. To examine the importance of Customer Relationship Management.
  3. Research and investigate further opportunities of applying CRM for Lidl
  4. Investigate that Customer Relationship Management can reduce costs for
  5. company.
  6. To explore the awareness and use of Customer Relationship Management for business.
  7. To present the findings, reflections and recommendations concerning and analyzed them in order to extend the applicability of this theoretical framework.
  8. Research about Customer Relationship Management in several companies and to compare the difference between them. And apply a recommendation to Lidl at latest stages of the dissertation.

Background of Lidl

According to company profile, Lidl & Schwarz Stiftung (Lidl) operates a chain of grocery stores. The company primarily operates in Europe. Lidl operates about 6,800 deep-discount department stores and no-frills Lidl supermarkets throughout Europe. In Germany it operates about 3,100 stores.

The company offers about 800 different products in its stores mostly under Lidl’s own brand. These include dairy products, frozen foods, sausages, fresh meat and poultry, fruit and veg delivered fresh every day, and a range of breads. The company established itself in the UK in 1994. Lidl is also expanding its presence into Denmark, Hungary, Norway, and Slovenia.

According to datamonitor Lidl Dienstleistung (Lidl) began operations in the 1930s, when the Lidl & Schwarz food assortment wholesale business was created. The first Lidl Store was opened in south Germany in 1973. Lidl & Schwarz expanded regionally during the 1970s, and established a nationwide presence in the 1980s with its Lidl stores and hypermarkets under the Kaufland trading name.By the 1990s, Lidl & Schwarz had grown internationally, with stores operating throughout Europe.

Lidl strengths:

  • Very low prices.
  • All Lidl’s stores are to the same lay out and so this makes it very easy for customers to find what they want and feel at ease if shopping in a new store.
  • All shops are a bright yellow with dashes of blue, this makes the shop look welcoming and very appealing; these bright arrays of colours also make the shops easy to find off road sides and Dual carriage ways.
  • Outside the shops there is always a large car park with disabled spaces; all car parks owned by Lidl are free.
  • There is a trolley park. Most of these trolleys have children’s seats.
  • Fruit and Veg is delivered daily- except for Sundays.
  • Lidl constantly has half price offers on selected items and always try to bring in and try different exotic fruit for customers to try.
  • Chilled meat and poultry is delivered daily between 12 and 6 PM. they offer a range of chicken, turkey, beef and pork.
  • Frozen food, like our chilled food, is delivered daily at lunchtime and is put on sale immediately.
  • Lidl offer a vast range of frozen goods including ice cream, meats, seafood and convenience food.
  • Every Monday and Thursday, there is a new load of items added on sale. These can be anything from a thermo-flask, kids toys or a tent to the more luxury items of DVD players, Digital cameras and PC equipment.
  • There are leaflets in the store to let customers whet is going to be on sale and in some areas leaflets are distributed door to door.

Lidl Weaknesses:

  • Lack of the new technology used in the Lidl.
  • You will need to pay £1 to use the trolleys and when you have finished your shopping you get your pound back.
  • It is worth noticing that Lidl do not supply baskets.
  • In all Lidl stores there are only 4 tills. Most of the time there is only one assistant on the till and therefore you may sometimes have to wait.
  • At the checkouts you will have to pay for bags, 3p for small bags, 9p for large bags and 49p for freezer bags.
  • Lidl don’t employ many staff and so each member of staff working really has a lot to do.
  • Long waiting, queues and limited selection of goods
  • They do not appear to have an ”own brand” and not many brand names available.
  • Lack of staff and lack of supplies.
  • Limited ways to pay Lidl doesn’t take credit cards and cheques. (16) Review of Lidl.)

 

 


CHAPTER II: REVIEW OF THE LITERATURE

Introduction

Customer Relationship Management is a comprehensive approach for creating, maintaining and expanding customer relationships. CRM is about creating the feel of high touch in a high tech environment (Kerr. C 2002)

Customers are becoming increasingly changeable. For example the Internet has made it easier for them to find alternative suppliers who may be cheaper, more reactive or just better able to meet their ever changing aspirations.

CRM enables the business to detect and react to the customers constantly changing requirements – helping business to retain and expand your clientele and provide it with a solid platform to achieve business growth.

The goal of CRM is to provide the skill to communicate with customers through any media they choose & deliver information to customers in immediate. While doing this, the business management should analyze and provide complete view of customer’s behaviour patterns, past and present dealings to salespeople in order to offer the best possible solution and product to the customer.

According to Doyle, P (2000), “the management process that seeks to maximise returns, to shareholders by developing and implementing strategies to build relationships of trust with high-value customers and to create a sustainable differential advantage”.

In today’s difficult business situation, modified focus and attention to every customer is vital to gain loyalty and trust from customers. Personally service and attention is a must in order to successfully drive up sales. To improve relationships between customers and company  uses all possible channels of feedback and interaction. Today, every media is oppressed to achieve higher quantity of interaction.

(Bridge. H 2007)

3.2. Marketing

There is a strong relationship between CRM and marketing therefore we have to know what is marketing and how will be affected by CRM.

Martin, C (1995) stated “Marketing is concerned with customer satisfaction and with the identification of marketing opportunities; it is also concerned with harnessing of the firm’s resources and the focusing of those resources upon the most appropriate opportunities”.

In view of this statement the marketing it is not only a process of advertising  or selling, if we look at the above definition in more detail Marketing is a management responsibility and should not be only left to junior members of staff. Marketing requires planning implementation of campaigns, co-ordination and competent managers with the appropriate skills to ensure success.

Marketing objectives, goals and targets have to be controlled and met, participant strategies analysed, anticipated and exceeded. Through successful use of market and marketing research an organisation should be able to identify the needs and wants of the customer and try to delivers benefits that will improve or add to the customers routine, while at the same time ensuring that the satisfaction of these needs results in a healthy income for the organisation.

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Lidl and competitive advantage

There are four generic strategies to achieve a competitive advantage, the differentiation, cost leadership, differentiation focus and cost focus. (Jobber, 2004)

Lidl used the cost focus strategy of competitive advantage, to provide a superior customer value through their core competences of the retail market.

According to Uni Commerce, the international umbrella organisation of retail unions, Lidl is trying to copy US retailer Wal-Mart’s model of “pressing down wages and benefits and squeezing as much as is possible from its personnel”. Uni Commerce also castigates the company’s culture of secrecy, suspicion and anti-union dirty tricks. In one instance the company reacted to a successful union recruitment drive at its distribution warehouses by reconfiguring its entire corporate structure overnight.

The term competitive advantage refers to when a company can produce a superior

product and/or bring the product to the marketplace at a lower price than most of or all of

their competitors (Porter, 1985).

The greatest part of threats comes from other rivals such as Sainsbury , Aldi, and Summerfield with their particular products and prices.. Also the economy is no longer in its high stages, therefore many customers are not ready any more to spend those amount of money to get the products from high supermarkets.  

Competitive advantages of CRM

The business-marketing tool of CRM originated as the brainstorm of Siebel Systems cofounders Tom Siebel and Pat House. In July 1993, they built a sales information system grounded within integrated and expanded customer-service software.

Among Siebel Systems’s early adopters/customers were Brock Control Systems and Sales Technologies, Ford Motor Company, Citigroup, Inc., and Marriot International, Inc. According to Adam Kraber, of PriceWaterhouseCooper, Siebel Systems practiced the marketing tool of CRM first. Siebel Systems last release of a CRM solution, Siebel 99, flagships over 117 applications for sales, service, and the incorporation of multiple vertical markets. House and Siebel stated that Siebel Systems has clearly defined the CRM market (Center for Management Information Technology, n.d; Keller, 2007; Sweat, 1999).

CRM is a business and marketing knowledge management tool that empowers a business to customer-centricity and ultimately to success when it is utilized correctly. It is a fundamental change in the culture and the operation systems of the organization that goes beyond the automating of functions because it drives the organization to answer the call of the customers and become customer-centric. CRM is a strategy that uses information, including the wants and needs of the customers, to establish rapport with the customers and engender a dedicated, stronger relationship with individual customers and into long-term business partnerships and vendor/business relationships (Dickie, 1998). Fathy (1999) commented:

CRM is all about understanding the customers’ needs and leveraging this knowledge to increase sales and improve service. CRM blurs the boundaries between sales and service, and unifies a company’s activities around the customer. The overarching goal is to increase customer share and customer retention through customer satisfaction. (P. 1)

Examination of CRM

The composition of CRM includes many components, and it is a lifelong business prescription. Understanding the unique combination of components in CRM and the interrelationship of these ingredients is vital to successfully amassing CRM’s benefits for the customer-centric organization. The first course of action in accomplishing this task is to dissect and define CRM. CRM is a business model, a business strategy, and a prudent business practice whose principal goal is the identification, anticipation, and understanding of all of an organization’s future and current customers. The primary goal of CRM is to maximize the relationship between an organization and its customers and to take care of the customers. CRM enables a company to forge and integrate itself into the buying practices of consumers, all the while creating a tight bond and connection with them. CRM means the creation of a long-term, mutually beneficial business relationship between an organization and its customers, where the organization may intimately know and serve every customer in addition to understanding and anticipating the wants and needs of current and future customers.

CRM is a customer-centric business strategy that asserts that customers are an asset that must be managed successfully throughout the entire customer life cycle. According to CRM best practices, CRM is all about finding, knowing, and delighting customers. CRM should transform an organization’s customer relationships and customer interactions into an atmosphere reminiscent of a friendly, small-town American corner store (Blodgett, 2000; Bresnahan, 1998; Fickel, 1999; Foster, 2001; Kalakota & Robinson, 1999; Sims, 2000a, 2000d; Thompson, 2000b, 2000c).

The design of a CRM system uses technology to track, coordinate, and integrate marketing, organizational sales, outstanding orders, customer-organization interactions, service and repair, customer service, and unresolved problems. In addition, a CRM system should facilitate the integration of all the organization’s systems from the top to the bottom of the organization, including, but not limited to, the supply chain, internal and external customers, stakeholders and the labor needs of the organization. The creation of a CRM system should focus on the customers and should place the customers at the initial point of design.

Customer-centric organizations target new customers, acquire new customers, and convince new customers to purchase or obtain their product(s). They use CRB technology to capture new customer data; combine them with external and internal sources; and consolidate them into a central information database, which adds intelligence to the organization. CRM is dependent on the capture, storage, and analysis of all customer-related data used to deliver personalized service to customers (Blodgett, 2000; Bresnahan, 1998; Fickel, 1999; Foster, 2001; Kalakota & Robinson, 1999; Sims, 2000a, 2000c; Thompson, 2000b, 2000c).

The Crux of the Matter

The retail industry revolves around the customer more than any other industry. It becomes imperative to do more than just interact with the customer in an effective and efficient manner, but also to “know” the customer. Knowledge about the customer and about the current business environment (internal and external) delivers increased profits, market share, and customer loyalty. (Rao & Raparia, n.d., P. 1)

CRM and the implementation of customer-centricity translate into three core proficiencies: communication and codification of pertinent and relevant information; efficient codification of the information, thus transforming it into data; and knowledge management and effective utilization of that knowledge. According to Exact Software Company (2002), “E-customer relationship management is an essential tool for effective, goal-oriented account management and sales automation” (p. 8). A. T. Kearney Company also disseminated the following message: “Customer relationship management will be the one piece of the business landscape that will differentiate successful companies from the pack. It is the one thing that will enable leading businesses to maintain or expand their profit margins” (as cited in Gorsage & Haas, 2003, ¶ 3).

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Communication

Communication is the foundation of CRM. CRM systems and accessing CRM tools unlock the mysteries of consumer behavior (Rao & Raparia, n.d.). Communication between customers and corporations is the mining place of raw information. Codification of the raw information into the CRM system translates into customer analytics that facilitate effective knowledge management.

Adoption of CRM

Understanding the concepts behind the utilization of effective CRM is only part of the holistic prescription. Examination, analysis, and strategic implementation are essential to business success utilizing the concepts of CRM. This means examining internal business practices, company culture, procedural processes, information management practices, along with company knowledge management strategies and procedures.

CRM best practices demand executive leadership, thorough planning, executive staffing, and a realistic implementation approach. Ideally, these best practices should be implemented in conjunction with an exemplary technology plan and supplemented by a committed team of members. This committed team should be comprised of a visionary leader, team associates who are psychologically committed to the cause, and solution providers who partner the cause. Vendors and supplies who consider themselves as partners and act as partners, rather than just another cog in the wheel composed of many vendors or suppliers (Thompson, 2000a). Thompson recommended the following five best business practice steps for the effective business implementation of CRM:

Practice 1. The business executive who formally sponsors the project provides direction for the accomplishment of specific business goals while resolving critical issues.

Practice 2. The project team performs a thorough analysis of short- and long-term requirements, soliciting input from key stakeholders, especially from channel partners.

Practice 3. Project teams select solution partners, based on the strength of the solution partners’ technology and commitment to services and support.

Practice 4. A project manager staffs the team with competent and committed professionals who have expertise in all critical functional and technical areas.

Practice 5. A project team implements a pilot or prototype first and then rolls out tested and successfully proven program applications in phases as appropriate to the growth of the organization. (pp. 3-4)

These are but a few of the new customer-centric tools born of technology and cyberspace. These new tools enable a business to differentiate itself from the pack through the adept utilization of CRM. These tools are specifically the tools of CRM and they are definitely worth the research, consideration, and time of the visionary leader.

CRM Strategy

To help businesses manage with the ever-increasing customer stress, many companies have chosen to implement a Customer Relationship Management (CRM)

Anderson(2003) stated :As a rule of thumb, creating your CRM strategy warrants about the same amount of time that you spent creating your business plan.

This collaboration tools can assist at all stages of CRM strategy development. The customer is king now more than ever. In today’s competitive business setting, recognize this fact is imperative for a company’s success.

Customer Relationship Management is not new. In fact, it’s been the foundation of business since the first trade ages ago. What is new are the CRM strategies, technologies and applications that enable better management of customers, customer information and the business as a whole.

An included CRM strategy gives the business access to clever information on customer profiles as well as drive metrics and analytics.

CRM strategy can help the business understand which channels are most effective, which the strategies are generating the most leads, and which lists resulted in better response rates. This enables the business to measure the CRM strategy effectiveness and allocate resources to the most successful tactics, such as Trapp R (2007) stated that knowing, understanding and predicting what your customers want – and will want in the future – is vital to the success of small to medium-sized enterprises. And CRM is the key.

Customer Satisfaction

The link between satisfaction, service, sales and profits is direct, the more a customer is satisfied, the more customer spends, then when they  spend the more, business will sell more, and usually when they sell more the profits are greater.

According toGerson, R (1993), when a product or service meets or exceeds a customer’s expectations, the customer is usually satisfied.

The think that counts today is customer satisfaction. If your customer is not satisfied, he or she will stop doing business with you. All the things you do to achieve quality and provide excellent service are not important at all if you do not work to satisfy the customer.

Satisfied customer does more business with you more often. They purchase more each time around, and they purchase more often.

They also refer their family and friends to you. The link between sales, service, satisfaction and profits is direct. The more a customer is satisfied, the more he or she spends, the more customer spend the more you sell, and usually when you sell more your profits are greater.

The growth of the market is driven by organizations’ recognition of the importance of positive customer experiences.

New line product and loyalty card is also one of the important elements of CRM strategy, Lidl has to build loyalty between customer and the company. This is very important stage. Lidl has to know their customer and keep his satisfaction on the high level. To help receiving this information they have to know the customer needs. One of the methods is a loyalty card system, which benefit the business and customer. This little innovation show the customer habits so the company can improve service provided to their customer. Customers have benefit of this card as well, because every specified time they receive the bonus voucher, which can be subtract from the shopping amount in the next shopping time.

Other method is expanding the line of the product, which will satisfy customers with special diet (organic food, low fat, fresh and extra special goods).

 For example ASDAis a retailer that appreciates the customer needs through the loyalty card. They as well developed  the new line product because they see the benefit of it. All the new line of product are sale well what make them adding and extend ranges (Elizabeth R 2007).

Business benefits of CRM

Implementing a customer relationship management (CRM) solution might engage significant time and expense. However, there are many possible benefits.

knox S(2003) stated that improvement in customer service and satisfaction is one of the most popular measures of CRM success, probably because these are relatively easy to measure.

A main benefit can be the improvement of better relations with business existing customers, will lead to:

Better sales through better timing due to anticipate needs based on significant trends

Identify needs more effectively by understanding specific customer needs

Cross-selling of other products by highlighting.

Successful targeted marketing communications aimed specifically at customer requests

A more personal approach and the development of new and improved goods and services in order to succeed more business in the future

Improved customer satisfaction, and ensuring that your good reputation in the marketplace continues to grow.

Increased value from your existing customers and reduced cost linked with supporting and servicing them, increasing your overall competence and reducing total cost of sales.

Once the business starts to look after its existing customers successfully, hard work can be concentrated on finding new customers and growing the market. The more knowing about business customers, the easier it is to identify new forecast and increase the customer base.

Even with business of improved knowledge, there’s always space for improvement. Customer needs change over time, and technology can make it easier to find out more about customers and ensure that everyone in a business can develop this information.

CRM and Technology  

CRM is reliant on the use of technology, more specifically information management  technology.

Research in the field of knowledge management, a closely related discipline to IM and CRM, found the SME sector was less advanced in KM in comarison to large organisations, with low levels of investments in KM approaches and systems, mainly as a result of low resource levels and lack of time (McAdam and Reid, 2001). However in the same study SMEs showed an appreciation for the value of knowledge in gaining competitive advantage through responsiveness (McAdam and Reid, 2001), thus suggesting that were the resource and time issues removed, SMEs would seek to employ the technology.

Jeffcoate et al.( 2002) stated that “low sales resulted from a combination of constraints…In particular, most companies had limited knowledge about how various computer technologies could contribute to an overall e-commerce strategy and were frustrated by their dependence on external service providers” .

This suggests SMEs may employ technology on a whim or to avoid competitive disadvantage, without prior appreciation or realization of the strategic benefits to be gained. As a result SMEs that adopt CRM technology may do so without ever experiencing or understanding the full benefits it has to offer, and whilst CRM packages may be affordable, it may prove expensive if there is an over reliance on external service providers to customize or in tergrate the technology with other systems.

The key factors influencing the take up of technology within the companies such as Lidl include financial resources and the knowledge of the managers, whilst the use of the technology and resulting benefits are mainly related to the knowledge of the staff. In order to harness the full power of a CRM system it will need to integrated with other systems, which may be costly for SMEs, depending on the level of reliance on external service providers to perform such tasks. Throughout the literature resource constraints, both financial and knowledge resources, are highlighted as the main barriers to the helpful use of technology by small firms. However there are contrasting views as to whether SMEs are strategic in their approach to the use of technology, with the majority of papers approving they are not. For CRM to be successful it must be implemented strategically with a focus on the long term.

Online CRMis possibly one of the most important factors of a business model when

setting up an and improve the website. CRM strategy describes exactly how you intend

to enter the retail market and attract new customers. Lidl may have a good business

concept or idea, but it will fall flat on its face unless the product or service is properly

marketed to potential customers. Anything that is done to promote a Lidl’s product

to potential customers is known as marketing and is vital when running any

business. If consumers are not aware of  Lidl’s existence then they are unlikely to

purchase the products and the business will most likely fail. Advertising a website

through the use of a new technology and provisional interface design, posters and flyers can point consumers in the direction of the site and this can be all that is needed to push them to use it.

Why CRM sometimes fail

According to  Nelson S (2000) stated that, customer relationship management (CRM) implementation fail, because companies jump at IT solutions in the belief that the application of technology will achieve the twin, Customer Relationship Management Goals of loyalty and profitability.

Nelson S (2000) regards failure of Customer Relationship Management projects that no one size of these projects fits all industries. Most industries are interacting in different ways with their customers, the only difference is that, every industry has it’s own unique way on managing their interaction with customers.

It can be seen from the previous statement, in order to enhance and maintain these interactions with their own customers companies have to realise that to choose wisely the appropriate application that match it’s own industry. S. Nelson 2000 gave an example for this; American fashion retailer Nordstrom Inc. is notable for its high level of customer service.

According to Fredrick Reicheld at al (2001), customer relationship focuses on how to enable the companies to maximise profitability with their customer. The answer to this lies, in providing effective ways that help companies to differentiate between high and low value customers. It also help to find answers to other questions, such as who are best customers, how can you attract them, how to ensure that you are selling them the products and services that are of their primary customer needs, yet in addition still make money for the company. This will be discussed in detail in the next section.

A small number of companies are beginning to recognise the importance of customer relationship marketing. King S (1999) maintains that many companies now recognise that in a recession it will difficult to acquire new customers to replace those lost .instead they should work hard to retain their customers. to retain customers become even harder when competitive pressures affect customer retention. king S (1999)states that many firms fail to exploit one of their most powerful data inputs. The customers complains .over half of the firms failed to respond to customers complaints by doing nothing with the information they receive about their customers .of those who do , a third of sales and marketing departments and two thirds of call centres do not have the information available at the next point of contact ,  he stated that the changes are everywhere, specifically in the insurance industry .deregulation has increased competition, and CRM is changing the relationships and interactions between clients and business parties . the future of customer relationship management will proved many organisations  with a global reach into new markets and forever change the cost and distribution structure in  the insurance industry.

CHAPTER III METHODOLOGY

Introduction

As the character of the study is investigative, the researcher has decided to follow the interpretive approach. This choice was based on the required to provide an in depth close of to the topic and to add if achievable to the existing research. In an investigative research the researcher reviews secondary data, carries out some questions through survey to Lidl customers, and interview one of the store managers to arrive to an understanding of the current situation.

This research aims to investigate the impact of CRM effects in helping Lidl to growth, setting up strategy and competing in the retail market by comparing theories with practice. This set has studied general theories of CRM strategy, benefit of CRM, customer satisfaction. 

The research method is a valuable tool in building growing knowledge, as a thorough review of past research and developments does not only provide the require insights and knowledge capital, but also is more possible to ensure that resulting research builds on past activities. The main objective of this research is to carefully evaluate the extent that CRM enhances the CRM image of Lidl among the external customers based on a several stages of research.

The reason of reviewing the literature review is to give an carefully knowledge of the issue area quoted by Saunders et al (2000) defines research as:“Research is a structured inquiry that utilises acceptable scientific methodology to solve problems and creates new knowledge that is generally applicable”. 

According to Saunders et al (2000) the researcher should not regard the move structured techniques as better or in some way more scientific simply because they lend quantitative analysis, or because many studies go from the qualitative to the quantitative as understanding progress.

Jankowicz, A (2000)  mentioned that “research method is the systematic and orderly approach taken towards the collection and analysis of data, so that information can be obtained from those data.” In order to carry out a research investigation, several methods are undertaken business research and management project work.

In this research the researcher will use a combination of methods, qualitative and quantitative methods.. Jankowicz , A(2000) suggests that research techniques are step-by-step procedures, which researcher can follow in order to collect the data, and analyse them for the information they contain.

3.2 Secondary research

The secondary research will focus on a review of customer relationship management. The latest information will be collect in the next stage on the topic of CRM will obtain  from deferent sources.

The main reason for choosing to rely on secondary data for the view set objectives of the research is that it enabled great savings in resources such as cost and time, then allowing more effort to be used up on the collection and analysis of the primary data which was the other goal of the research. Though, there are some disadvantages in the use of secondary data, which should not be overseen. The most important are the consistency and the validity of the data. In order to overcome those complications the author referred to a number of reliable sources such as a specific data that are not available in the collection of the secondary data, data from Lidl store, are likely to be reliable because of the continued reality that depends on the standing of their data.

3.2.1  Internal Documents and lidl profile

Obvious is, that the reports used are the company’s primary data but for the researcher are secondary, as they are ‘data already has been collected for other purposes and includes both raw data and published summaries’ (Saunders, Lewis and Thornhill 2000:188). What’s more, all the reports were used in accordance with the Lidl’s policies and ethical principles and with the consent of the department (see appendix 3).

3.2.2  Books

Books are also an important source of secondary data. The material in books is generally obtainable in a more ordered and reachable method than in journals, pulling together a broad range of topics.

On the subject of Customer Relationship Management and the latest theories behind them, a number of texts from the available sources will be use as reference material. 

Saunders et al (2000) stated: “secondary research includes both qualitative and quantitative data and both can be used in descriptive and explanatory research. The researcher may use raw data where appropriate. Others have different views on secondary data approach, argues that secondary data has a variety of data. Based on three main subgroups of secondary data were built on his documentary data, survey-based data and those compiled from multiple sources.

3.2.3 Journals/ Magazines 

Journals and Magazines are also known as periodicals and are a very important source for any research. The articles in them are easily reachable usually through the Internet and they have a certain amount of significance and helpfulness. though according to Saunders, Lewis and Thornhill 2000:54, professional journals ‘may contain articles which are biased towards their author’s or the organisation’s views’ for that reason the researcher required to exercise caution.

From Leeds Metropolitan University Business Database, access is available to a wide range of Electronics Journals containing articles on the subject of Customer Relationship Management (CRM) such as European Journal of Marketing, Marketing Intelligence & Planning Journal, and Journal of Consumer Marketing, I will use it widely in the dissertation. for example  electronic journal such as Emerald, Mintel, financial Times, and Business Management Journals.

3.2.4 Competitors companies:

 During the researcher previous study, work experience and specially in the past 9 months, the researcher has logged over 100 hours on more than 10 UK and retailer markets as part of his research approach in order to gather the necessary knowledge for the objectives of the research.

3.2.5 The Internet

The World Wide Web contains thousands of articles of information that can either be

relevant or irrelevant. Using relevant academic websites and tailoring searches to

obtain appropriate articles will be one of the main sources for researcher. Information on CRM topics, methodologies and the background of Lidl and competitors will be obtained helping towards reaching the aim of the dissertation, also the internet is convenient and efficient source up-to-date information.

3.3 Primary data

Primary data will be regarding the conceptual framework of CRM within Lidl through personal interview with a Lidl store manager and designing a survey to their  customers.

In order to best provide the objectives of the research the researcher has selected as the best applicable method of data collection the personal interviews and survey to Lidl’s customers to find out their opinions.

 O’Leare (2004)  stated that; ‘interviewing is a method of data collection that involves researchers asking respondents open-ended questions’. Interviews include individual interviews and differ from direct observation primarily in the nature of the interaction.  In interviews it is assumed that there is a questionnaire and an interviewee.  The purpose of the interview is to explore the ideas of the interviewee about the phenomenon of interest. The researcher considers that the main benefit of the interview technique is its flexibility, the in-depth approach and experience searching.

The additional benefit of the interview method is that it enabled him to cooperate with the interviewee in order to clarify or provide further explanations in cases of ambiguity or misunderstandings. Also, it allowed the interviewer to regulate his line of questioning, depending on the interviewee responses by increasing on areas of interest and cutting back areas which are unrelated to the topic. A sensible drawback of interview as recognized by the researcher is that it is a effort consuming method of collecting data. The researcher before meeting with Lidl manager emailed him the questionnaire as he wanted to allow him some time to prepare his answers, followed by the interview itself. Social interaction between the researcher and Lidl manager was also managed and he delivered the questions in the same tone so that he hasn’t indicated any bias.

3.3.1 Questionnaire

Use of a questionnaire as a quantitative method to successfully capture the opinions of Lidl customers, employees and management. Saunders et al (2000) suggests this as being the most appropriate method of collecting mass responses to the same questions, and as such, providing a good method of comparative analysis. The questionnaire will cover a number of Lidl customers to find out their opinion regarding Lidl’s CRM, this questionnaire will enable the researcher to identify and describe the variability in different phenomena.

Designing good questionnaires calls for significant skills and experience therefore, the researcher start the research by set up survey questionnaires that addressed if possibly the same or close to interview issues to the customers. The researcher prior to using his questionnaire to find out the customers opinion regarding Lidl services and facilities.

According to Collis and Hussey (2003), it is important to pilot or test my questionnaire as fully as possible before researcher distributing them. Before distributing the questionnaires, he  asked his supervisor as well as some of his friends to go through it and spot anything, which need to be changed.   There were 10 questions.

researcher copied 50 questionnaires in A4 pages and distributed to Lidl’s customers in Gipton branch by researcher.. An introduction was explained about the nature of survey in the first page on the front page of the survey (see appendix 2).

The questionnaire was designed base mainly on discussed theories, which presented in literature review. This means the empirical material was structured based on theories therefore, is assumed to be more appropriate to the company.

3.3.2 Interviews

In order to achieve the purpose of the investigation the key focus lies on finding out which techniques and results should be applied. Interviews will be the best method for understanding this research. According to Saunders et al (2000)suggest that: “A respondent interview is one where the interviewer directs the interview and the interviewer responds to the questions of the researcher”. Jankowicz, A(2000) argues that the standard survey interview is itself essentially faulted and that it therefore cannot serve as the ideal ideological model against which to assess other approaches.

Also interviews have been described by (Pole and Lampard 2002) as a verbal exchange of information between two or more people for the principal purpose of one person or group gathering information from the other. As pointed by Moore (2000), semi structured interviews enable one to fix and control circumstances in order to collect appropriate data while remaining flexible and responsive.

The structure and approach of an interview is resolute by its purpose. There are different types of interviews such as market research to collect correct information so that development and marketing of the product can be achieved and research – to reach information and have a clear understanding to the aims of the research and specify answers to any questions. (Gillham, B. 2000) stated “An interview is a conversation, where one person – the interviewer – is seeking responses for a particular purpose from the other person: the interviewee”

3.4 Quantitative and qualitative data

There are two main approaches in implementing the activity of the research, ‘Quantitative research’ and ‘Qualitative research’.

Qualitative data are data which are based on meanings spoken through words. One of the most common methods for qualitative data collection, personal interviews is also one of the most challenging. 

Quantitative data is a process depends on the amount of data collected for the accuracy of the data. The measure of this research is aimed through the objectives as this method of research allows the ability to attain a greater statistical type

researcher designed the questionnaire based on established theories (literature review) to collect primary data. According to Bryman and Bell (2007), a research can be either quantitative or qualitative.  Since the formulation of questions was theory driven and the selection of respondents needed to follow statistical rules therefore this research obtained quantitative data (Collis and Hussey, 2003).

According to Bryman and Bell (2007), theoretical sampling methods used to support grounded theory approach. Through literature review this paper investigated the concept of line managers’ role in the process of change, and based on established facts (theoretically) allowed to use the techniques in order to conduct research to investigate the concept and possible relationships and factors that may impact upon it.   Bryman and Bell (2007) suggest that secondary analysis is the analysis of data by researchers who will probably not have been involved in the collection of those data. Secondary analysis may entail the analysis of either qualitative data or qualitative data (Czaja and Blair, 2005). 

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3.5 Data Analysis

Qualitative data analysis describes and summarizes the accumulation of words generated by interviews. It allows researchers to investigate for relationships between a range of themes that have been recognized or relate behaviour.

Trochim, W. (2005) define qualitative research “It requires that the researcher become a participant in the context being observed.  The literature on participant observation discusses how to enter the context, the role of the researcher as a participant, the collection and storage of field notes. Equally important to the data collection method, is the decision on how to analyze the collected data. As the research method is interpretive, it should be accompanied by a qualitative data analyses”.

Implications for rule or practice can be derived from the data, or analysis sought of puzzling findings from previous studies. Qualitative data is linked with description; it copes with meanings or patterns of behaviour of Lidl’s customers. However, there are no undemanding techniques in qualitative analysis as there are most likely as many different ways of analyzing qualitative data as there are qualitative researchers doing it! The researcher deems that qualitative research is a subjective exercise, and then the researcher is closely involved in the process, not detached from it based on the theoretical framework the researcher is going to analyze and interpret the data obtain from the lidl’s store manager interview and customers survey, by getting familiar with the data through review, reading, analyzing in order to come to conclusions applicable to the situation under examination, and to test the sensible strength of the framework. This data analysis helps researchers to build decisions more quickly by helpful key facts, patterns and trends among the Lidl’s customers and the interview, therefore fulfilled the last objectives of the research and finalized the last stage of the conceptual framework.

3.6 Validity and Reliability of Results

Saunders (2003) stated that “The results of research are all around us. A debate about the findings of a recent poll of people’s opinions inevitably includes a discussion of ‘research’, normally referring to the way in which the data were collected”.

This research being a phenomenological by taking into account Collins and Hussey (2003) all questions were related to theoretical characteristics, which discussed in literature review and the process is accurate in collecting, analysing and a rich sample therefore the validity of result is quite high

There are many different aspects of validity, which influence the validity of the research in general.  The validity of the effectiveness of CRM which were discussed in literature review (theoretically) has been tested in real world through questionnaire in selected company.. 

3.7Ethical consideration

The ethical form of the Leeds Metropolitan University and the consent letter  been completed, agreed and signed by researcher and his supervisor, then attached to appendixes.

All participants were made aware of the research intentions by an introduction letter. Findings have been treated with the highest confidentiality .no source whether individual or organisation was or be correlated with specific findings or comment attributed without the express permission of the originator or organisation.  All discussions will remain confidential in relation to other organisational participants and during the reporting of finding s. all the participants have the right of anonymity.

 The particles were treated with the highest respect and their right not to answer a question was appreciated. In order not to intrude on privacy, no further efforts were made or will be to contact a potential participant after two attempts. Other than the offer of a general statement of the finding for agreeing to participate to no other participation inducement were offered.

While interviewing Lidl manager, researcher remained cognitive of the chosen interview time and make no attempts to purposively extend the interview. As the interview participants for this research have very demanding schedules, no attempts were made or will make to infringe on there good will supplementary questions.

All the secondary data sources are given full credit for their contribution to this study. The collected data is represented honestly and the analysis is to the best of the researcher’s experience and ability.

 


CHAPTER IV: RESULTS

Introduction

As discussed in the previous chapter (research methodology), the researcher collected primary data through two different methods: the quantitative data was collected through questionnaire based surveys while the qualitative data was collected through semi-structured interview with the participants of this study. As described in the introduction of this study, the specific objectives of this study were:

  1. To define CRM in retail contest
  2. To examine the importance of Customer Relationship Management.
  3. Research and investigate further opportunities of applying CRM for Lidl
  4. Investigate that Customer Relationship Management can reduce costs for company.
  5. To explore the awareness and use of Customer Relationship Management for business.
  6. To present the findings, reflections and recommendations concerning and analyzed them in order to extend the applicability of this theoretical framework.
  7. Research about Customer Relationship Management in several companies and to compare the difference between them. And apply a recommendation to Lidl at latest stages of the dissertation.

Considering the objectives of the study, the questionnaire was designed to ascertain from the participants their views and perceptions about the CRM and how CRM could improve the business perspectives of Lidl. In the next section, first the researcher will discuss the survey results and in the next section, the interview will be discussed in detail backing up with the literature reviewed.

Demographic characteristics

As stated earlier, there were a total of ten questions which were asked from the participants of this study. The first question aimed at ascertaining the characteristics of the customers of Lidl from the perspective of their repeat visitation. As shown in table 1, the majority of the participants (34%) had been the customer of Lidl since less than a year while the other significant group was the customer of Lidl for one to under three years (32%). However, further analysis of the repeat visitors shows that there were 20% of the participants who had been visiting Lidl since three to under five years, 8% had been visiting Lidl five to under ten years and 6% of them have been visiting Lidl since ten years or more which shows that Lidl is successful at retaining their customers for more than ten years which is a great achievement on the part of the Lidl administration. The same figures are shown in graphical form in figure 2 below.

Table 1: How long have you been a customer of Lidl?

Less than one year34%
 One to under three years32%
Three to under five years20%
 Five to under ten years8%
Ten years or more6%

Figure 2: Repeat visitation of Lidl

The intent of the next question was to know how often the participants visited Lidl in order to value the CRM success for attracting and retaining their customers. The results shown in table 3 show that the majority (50%) visited Lidl 2 to 3 times a month, 26% visited Lidl once a week or more, and 16% of them visited Lidl once a month. However, there were no daily visitors and only 2% of the participants visited Lidl 2-3 times a year. Although these results are fairly encouraging and demonstrate that the CRM strategies of Lidl have attracted repeat visitors, the weak point of its CRM strategy is visible in daily visitation. In this context, the organization has to concentrate and adopt suitable strategies that may attract more visitations on daily basis.

Table 2: How often do you buy products from Lidl?

Daily 0%
 Once a week or more 26%
2 to 3 times a month50%
Once a month16%
Every 2-3 months6%
2-3 times a year2%

 

The results shown in table 3 are very positive in the context of Lidl relationship with its customers. The customer-centric organization (a) understands, embraces, and lives within an operating and organization model that focuses on the customer; (b) works diligently to increase customer satisfaction, maintain customer loyalty, and understand what the  customer wants and values, all while increasing the organizations profitability and perpetuating growth of the organization; (c) adjusts, hones, and tailors its business streams, which include the organization’s product, development, demand generation, production and scheduling, supply chain, and customer care, with the organizational goal of delivering the greatest value to the best customers for the least cost (Kocourek et al., 2004); and (c) has a workforce that is devoted to utilizing a company-wide, technology based internal customer information system, and is willing to make a strong commitment to serving customers (Wrenden, 2005).

Customer relationship

The analysis of the results presented in table 3 shows that though the relationships of Lidl with its customers are not excellent (only 2%), for the majority of the participants (84%) these relationships were good. For the other 10% of the participants these relations were average and for 4% of them these were fair. Interestingly, no participant declared the relationship with Lidl as poor which shows that the Lidl management has a customer-centric strategy and understands, embraces, and formulates such strategies that are focused entirely on customers’ retention and in this regard the management of Lidl works diligently to increase customer satisfaction, maintain customer loyalty, and understand what the  customer wants and values, all while increasing the organizations profitability and perpetuating growth of the organization (table 3)

Table 3 : How would you rate the quality of your relationship with Lidl?

Excellent2%
 Good84%
Average10%
 Fair4%
Poor0%

Customer relationship management is an organizational business strategy that takes a customer-centric view of customers by placing them at the center of the organization’s universe. CRM identifies new opportunities for organizational expansion and improvement of customers’ value, satisfaction, and retention (Grant & Anderson, 2002). As the essence of CRM strategies is its main focus on customers’ relationship, the intent of the question 4 was to ascertain from the participants how they regarded their satisfaction level with Lidl. As shown in table 4, according to 64% the level of satisfaction with Lidl was good, 18% of them declared it excellent, for 16% of them it was average and none of them said it was poor. So, the results demonstrate significant success of Lidl for satisfying its customers which is an essential approach to retain their customer for a long time.

Table 4: How would you rate your level of satisfaction with Lidl with regards to their prices?

Excellent18%
 Good64%
Average16%
 Fair2%
Poor0%

 

Product quality

Henry Fayol (1916) shared his thoughts about organizations and the people within those organizations. His book revealed his belief that the quality of products should be paramount. Lastly, in 1978, Miles, Snow, Meyer et al. discussed the contradictory pulls of exploration and exploitation in their seminal work on adaptation with respect to strategy, structure, and process. Couched in efficiency and effectiveness terms, they categorize firms as Defenders, Analyzers, Prospectors, and Reactors. The customer relationship management needs to consider all these aspects especially when the quality of products matters much in order to retain the customers. For Lidl, the quality of products is much more important as it has attracted fairly large repeat customers which need to be retained over a long time. As shown in table 5, the intent of the question was to ascertain from the participants how they viewed the quality of products offered at Lidl. The responses derived from the data analysis are very encouraging as for the majority of them (72%) the product quality was satisfactory and the other 8% of them were very satisfied with it. However, as against other results described in previous sections, some of the participants (2%) were dissatisfied with the quality they found at Lidl which warrants the attention of the management. Further, a significant population (18%) showed their neutrality which also demonstrates that for them the quality of product was not satisfactory after all.

Table 5: How satisfied are you with Lidl with regards to the quality of their products?

Very satisfied8%
Satisfied72%
Neutral18%
Dissatisfied2%
Very dissatisfied0%

Customer support

As discussed in the review of the literature, customer support is vitally important for the successful retention of customers because increased value from existing customers and reduced cost linked with supporting and servicing them, increasing the overall competence and reducing total cost of sales. Once the business starts to look after its existing customers successfully, hard work can be concentrated on finding new customers and growing the market. The more knowing about business customers, the easier it is to identify new forecast and increase the customer base. In this context, the results presented in table 6 demonstrate that the Lidl management has contributed fairly well in providing customer support as for the majority of the participants (58%) the helpfulness of the Lidl staff was satisfactory while for 8% it was very satisfactory. However, another significant group (30%) was neutral in this context which shows negatively impression inviting the attention of the management to revise their customer support services.

Table 6: How satisfied are you with the helpfulness of their staff?

Very satisfied         8%
Satisfied58%
Neutral30%
Dissatisfied4%
Very dissatisfied0%

A similar, but with a different perspective the satisfaction level of the participants was ascertained about the personal interest given to them by the staff of the Lidl. As reviewed in the literature, the competitive business situation requires personal attention of the staff to the customers in order to feel them being given personalized services. Personalized services and attention is a must in order to successfully drive up sales and retain customers over a long time. To improve relationships between customers and company uses all possible channels of feedback and interaction. Today, every media is oppressed to achieve higher quantity of interaction. In this context, the results shown in table 7 are although satisfactory to some extent as for the majority of the participants (10% very satisfied and 28% satisfied respectively) the personalized services provided by the Lidl were satisfactory, another significant group remained neutral (48%) which shows not most of the repeat visitors were satisfied with the personal services and care with the Lidl.

Table 7: How satisfied are you that staff at Lidl show an interest in you as an individual /   treat you as a valued customer?

Very satisfied         10%
Satisfied28%
Neutral48%
Dissatisfied10%
Very dissatisfied4%

In order to retain and attract customers for a long time, the most important CRM strategy is the facilities it provides to its customers. The results shown in table 8 demonstrate that contrary to the previous results with regard to their satisfaction of customer support and the product quality, the level of facilities provided by Lidl was not very satisfactory as 26% of the participants declared it poor. However, not all respondents showed this negative impression and a significant population said it was good (32%), for 22% of them it was fair and 16% rated it average. So, overall, though the facilities provided by Lidl were satisfactory, it needs more improvement.

Table 8: Please rate Lidl’s facilities such as: help desk, toilets, car park etc

Excellent4%
 Good32%
Average16%
 Fair22%
Poor26%

As stated in the review of the literature, online CRM is one of the most important factors of a business model as it has become a fast medium of commutation and interaction. Considering the importance of website as a marketing tool, the intent of the question 9 was to ascertain from the participants how they utilized the Lidl website. Unfortunately, the results shown in table 9 are very discouraging as a significant majority (94%) did not visit the website of the Lidl for business interaction or communication. This is certainly a drawback of the CRM strategies of the management as in this age of information technology most of the organizations and business corporations have concentrated on internet to promote their products and access a large population for introducing their products. Thus, if the management of Lidl may improve their presence on internet, Lidl may have a good business.

Table 9: Do you use Lidl’s website?

Yes6%
NO94%

Two aspects of an organization or corporation are the most important for attracting and retaining customers: Product quality and service quality. Especially, product quality is vitally important because customers main concern is always on products they are going to buy.  According to Srivastava et al. (1999) core business process framework of CRM includes ascertaining new customer needs through market experimentation and designing tentative new product solutions and reinvigorating old products through technology monitoring and technology competence (Srivastava et al. 1999). Srivastava et al (1999) further state that the CRM business process includes channel bonding activities of collaboration, coordination, and communication with suppliers and the quality process management activities that are involved in manufacturing and product/solution assembly. Finally, the CRM process includes determining the needs of existing customers and potential new customers through competitor benchmarking of rival products, the current customer knowledge process and lead user collaboration. In this context, the participants were required to rate the variety of Lidl’s products in order to ascertain their level of satisfaction and the product quality of the organization. The responses shown in table 10 show an overall performance of the organization. For majority of the participants (70%) the variety of Lidl’s products was good, for 16% of them it was fair and for 4% it was excellent. However, only a small proportion (2%) declared it poor. Thus, the overall performance of CRM strategies of Lidl seems satisfactory which shows it has implemented the strategies effectively.

Table 10: How would you rate the variety of Lidl’s products?

Excellent4%
 Good70%
Average16%
 Fair8%
Poor2%

 

Follow up Interviews

As stated in the methodology chapter, primary data for this study was collected through two research methods: the quantitative data was collected through questionnaire based surveys while the qualitative data was collected through semi-structured interview with one of the managers of Lidl. The purpose of this interview was to review various CRM strategies of Lidl which it has adopted to improve the customer relationship through better services and products.

Interview question 1: What is “LIDL” doing to meet the customer’s requirements?

The intent of the fist question was to know how Lidl management planned to satisfy its customer’s requirements. Assessing customers’ requirements is vitally important in order to formulate and adopt new strategies with ever changing customers’ requirements.  While highlighting this importance, the manager said when they open new branches first they ascertain customers’ requirements through questioners. The questions are related to the kind of transport, which customers will be using and this help them to plan how big the parking area should be. Certainly, questionnaires are the best strategies to be aware of the customers’ requirements and taking necessary steps in accordance with this awareness.

Interview question 2: As we see all inconvenience depends on lack of staff. Don’t you think to employ more staff?

Enough staff ensures that every customer would receive personal care and attention. If some organization and corporation lacks enough staff, it will surely deteriorate the service quality and ultimately loose its valuable customers. In this context, the question 2 intended to ascertain from the manager of Lidl whether they were hiring further staff in order to improve their service quality. However, the answer was strategic and intelligently refusing the requirement of further staff. The manager said

“We don’t think so. Our customers know we care about them. They are coming     because they want to buy good quality cheap products. Employing any additional staff will cost and somebody will have to pay for it. And who will be pay of course customer. We try to make our store friendly and helpful as possible with out any extra cost.

Interview question 3: What you think about “loyalty card”? It’s worth to implement something like that?

As discussed in the review of the literature, loyalty cards are a new innovation in the filed of CRM which helps in establishing good customer and business relationships. This little innovation show the customer habits so the company can improve service provided to their customer. On the other hand, customers also benefit from this card as every specified time they receive the bonus voucher, which can be subtracted from the shopping amount in the next shopping time. Considering the  importance of the loyalty cards, the present question asked from the manager if they thought loyalty card worth introducing. However, the reply to this question was flat as the manager said:

The “loyalty card” are good, but we don’t think is good for a store like “LIDL”. This little change is required advanced technology. Maybe in the future. Who know?

Interview question 4: What about facilities for customer (toilets, changing room, help desk, free carry bags)?

Facilities like toilets, changing rooms, help desk, and free carry bags are essential requirements of the present day business place. Customers prefer to visit places where they feel comfortable and avail all such facilities. Thus, any CRM strategy should include these provisions for the customers in order to make them satisfied and loyal customers. In this context, the intent of the question 4 was to know if Lidl was also in line with these strategies and providing its customers necessary facilities. However, again the response from the manager seemed to ignore these provisions on account of increasing product costs. He replied thus:

We don’t provide to our customer changing room, one what we can say is that we don’t have place for it. Above that our customer don’t have problem with returning or exchanging product, which they bough. About toilets!! Hmm! We don’t employ special staff to look after toilets. If we will  employ a special person we will have more cost, which will be later on added to product prices. Our customer can always use personnel toilets if they need.  Help desk – required one person standing there and dealing with customers. This person will required training and this all is connected with additional costs. Cary bags – free carry bags – it isn’t something like a free carry bags. All bags, which are available in other store are already included in the price of the products, but the customers didn’t know about it. We are giving the customer chance to choose if he/she like to pay for it or not. And from other side we are friendly to the environment.

Interview question 5: Can you tell us, which type of technology “LIDL” is using?

According to Srinivasan et al. (2002) technology monitoring is defined as the process in which an organization acquires knowledge about and understands new technology developments in its external environment. Use of technology in corporate setting has become very important due to its convenience and obvious benefits. The researcher asked the manager if Lidl was also using technology and of what kind. The response from the manger shows an awareness of the importance of technology for the business improvement. According to the manager the Lidl was using technology of

  • still scanners, which are connected to the head office in Runk Corn near Liverpool. All prices (including offer prices) are deciding there and then the prices are putted into a system. Thanks to this system we are fare from confused situation like different prices charged for the same product.
  • digital scales connected to till,
  • “ACD” mini PC. It’s look like a scanner, but the function is wider. We are order the product and putting the wastages on it. Once monthly this device calculate all our losses and product ,which we receive. This device is also connect to our Head Office, where the information are update every single night.
  • you can use debit cards in all our stories,

Interview question 6: Has the “LIDL” technology has been improved recently with up to day technology?

The response to this question was not much encouraging as the manager stated flatly that technology was not a strong point in Lidl, rather their focus was on whatever facility was available in the market and what facilitated within cost.

Interview question 7: Are you planning implement any new technology in a short time?

Improvements in technology are so frequent that keeping up to date with everyday developments has become a serious matter for any technology driven organization. The response of the manager also demonstrates the same concern as he said:

We don’t think so. Any change, which we will be taking, will cost us money and this will have influence on our prices. Our strategy is offer ‘The highest quality at the lowest prices’. Customers are coming here, because they want to buy cheap good quality product.

Interview question 8: “LIDL” has a website, where display all new products, which are available and will be available in store. Your website got navigation map – how to get to the nearest store, and FAQ. Why you don’t sell the product on line?

In the analysis of the survey results surprising results have been discussed as the majority of the participants of this study did not visit the Lidl website for online purchases. The response to the question 8 reveals why participants did not visit Lidl website. According to the manager:

Yes we don’t sell product online. Firstly – any changes will change the prices as well and we like to keep our prices low as possible. Secondly – on our market situation, we don’t think so that we need this option. Maybe later on in future, but this decision it’s up to Head Office.

Interview question 9: What about hand basket for a small shopping?

Facilities like change rooms, toilets, carrying bags and trolleys are very common at every big retail store. These are the facilities the provide the visitors convenience and  attract them to be repeat visitors. However, interview response from the manager of Lidl shows (especially to the questions 8 and 9) that the management of Lidl considers such facilities as an economic burdon and does not want to waste time for such trivials. The reply from the manager reads:

We give up hand basket intentionally. We find very difficult to walk around the shop and tidy the basket. We don’t have time for it. People are different one is look to live tidy place and other no. On the same reason we stopped use the trolley with out a coin on. The trolley was often left on the parking area or even don’t brought back.

Q. How does supply chain in “LIDL” look?

A. Supply chain. As we seed our scanners near till are connected to the Head Office. They decide what they will supply to us and when. There is a big warehouse and from there the products are sending to us. We didn’t know from where the products are because always we get delivery from the same supplier. For us the supply chain look WAREHOUSE – DELIVERY SUPPLIER – OUR SHOP. Sorry if we are not competent to answer for this questions fully.

Interview question 10: Summarize. We know now that you don’t like implementing any technology concern to yours customers, because they will have to pay for it. But if you will be able to design “LIDL” marketing site, what you will improve or implement?

A. For now, we don’t look to change anything connected with technology. Most important for us will be expanding shop area (is a bit crowded) and put into service more check up. From 6 month we have our brand line foodstuffs and now we look to implement new line of products – organic food and not modify genetically (we are talking about 6-8 month term). Later on maybe we will look closely to improve our website for sealing on-line and implement self payment check up (personally I don’t like them), but this is not going to happened in near future.

We are good prospering company. We are the top business in growing up compare with our level businesses. Now we are going to open the fourth branch in Leeds. We doing well. The reason for our runaway success? Our strategy of always offering, ‘The highest quality at the lowest prices’.

 


CHAPTER V: DISUCSSION AND CONCLUSION

Introduction

The previous chapter presented the data collected through surveys conducted with the customers and Lidl and the interview with the manager of Lidl. The data collected through the questionnaire and interview has been discussed in detail in the previous chapter. In this chapter, an overview of the whole research work will be presented along with conclusion and recommendations

As stated in the introduction, the specific objectives of this study were:

  1. To define CRM in retail contest
  2. To examine the importance of Customer Relationship Management.
  3. Research and investigate further opportunities of applying CRM for Lidl
  4. Investigate that Customer Relationship Management can reduce costs for company.
  5. To explore the awareness and use of Customer Relationship Management for business.
  6. To present the findings, reflections and recommendations concerning and analyzed them in order to extend the applicability of this theoretical framework.
  7. Research about Customer Relationship Management in several companies and to compare the difference between them. And apply a recommendation to Lidl at latest stages of the dissertation.

Summary of the Results

The study examined the strategies of Lidl, its strengths and weakness and the strategies it adopted to attract customers and established better relationship with the customers

Data for the study were gathered from two main sources: the questionnaire based surveys and the interview with the manager of the Lidl. The findings of this data are very insightful and thought provoking. For instance, though the survey results show very positive outcomes for the customer relationship with the Lidl. The interview data suggests that the managements is reluctant to implement new technology considering it a waste of time and resulting in high cost. Similarly, though the Lidl has its own website, it does not offer online purchase service. Thus, it shows that there is a strong need for the management to reconsider its policies and strategies to bring the new technologies in line with the CRM strategies. The interview statements that were posed to the respondents were the following:

However, overall results of this study have supported a positive interaction between innovation strategies and firm performance. Therefore, dual focus firms enjoy better financial performance relative to their competitors that are embedded in largely explorative, largely exploitative innovation strategies, or lack focus in either. As such, dual focus can partially explain the success of some incumbents in high technology industries. Incumbent firms often relegate entrepreneurial activity in radical innovation to inventors and new entrants (cf, Agarwal 2002), and naturally restrict subsequent innovation activities along the same technological trajectory as their original radical innovation. Incumbent portfolios are often severely tipped toward exploitation as “…businesses are preoccupied today with minor modifications … while true product innovation has taken a back seat” (Oliva 2005, 5). This implies that many incumbents lack entrepreneurial thinking, intentionally choose not to pursue riskier entrepreneurship, or quite simply do not have multiple business processes in place to ensure both types of innovation are considered in their strategic decision-making. Business processes bring knowledge that is instrumental to effective innovation strategy decision-making, knowledge that is crucial to dual focus attainment and ultimately for firm performance.

Employing opposing business processes can also overcome the negative implications of legacy and core rigidities. Business processes are “deeply embedded” and become self reinforcing, eventually becoming institutionalized (Garvin 1998) and part of the firm’s legacy. Once embedded, they can trap the firm into either exploration or exploitation. However, companies can use embeddedness to their advantage by becoming proficient in processes that influence exploration and processes that influence exploitation, thereby reducing the negative implications of legacy. They can exert a positive influence on both innovation strategies as they give direction to innovation decisions and efforts. Firms will not become rigid in exploration or exploitation if they wisely and proactively incorporate multiple, yet often conflicting, business processes that influence both types of innovation strategies.

Marketing clearly has an interest in and a significant contribution to the strategic direction of the firm’s product innovations, and, thereby into firm performance. Their lead role in CRM make them vital members of the top management team of large corporations and small firms alike. Because of this, their influence in dual focus can and should be felt from the top of the organization, permeating through the ranks, to the working members that actively work the processes that influence dual focus.

Limitations and Directions for Further Research

The single largest limitation was the time restriction and as a result, only one manager could be interviewed, so the opinions expressed by him may not be in line with the views held by other managers at Lidl. Similarly, the research population was also comparatively low which was the result of the limited time available for this study.

This research leads to several interesting subsequent studies. First, further investigation into the negative business process interactions is warranted, as well as investigations into other interactions among and within each process. For instance, does the interaction of lead user collaboration and competitor benchmarking help or hind the efforts of firms to attain dual focus? Second, the research should be expanded to include other business processes not studied herein. Third, further investigations into the influences of strategy on firm performance are also warranted. The main effects of these variables on firm performance may yet be uncovered in the analysis of quadratic relationships or by uncovering a mediator, such as number of radical versus incremental innovations. Finally, future research should include production process innovations which are traditionally linked to exploitative strategies, but not explorative. Research efforts combining both product and production process innovations are severely lacking and would paint a more complete picture of innovation strategies in firms.