A defensive CRM strategy, what is it and what is needed for a defensive strategy?

An important first step is understanding what a defensive strategy is and knowing the alternative, an offensive strategy. You might know the terms defensive and offensive strategy from the sport field and no different than in sports, in marketing, these terms somehow represent each other’s opposites. An offensive strategy focuses on the conquest of market share, the acquisition of new customers and ridding oneself quickly of any competition. The defensive strategy, on the other hand, focuses on maintaining and defending one’s position. Barriers are thrown up to keep the competition at bay. (Peelen & Beltman, 2013)

Overall the defensive strategy is more focussed on the customer which makes it more suitable for the hotel industry. The strategy aims for an increasing customer commitment by increasing the customer satisfaction and focusses on customer retention. Goals that are very much related to the service industry and the hotel business.

However, as a hotel you will only able to implement a defensive strategy when the stage of customer intimacy as researched and explained by Treacy and Wiersema (1996) is reached. “The customer intimacy strategy is characterised by the fact that companies build up a relationship with customer. It is not so much the market that becomes the centre of attention, but the individual wishes of customers that count.” (Peelen & Beltman, 2013)

Unfortunately reaching this stage is not as obvious as one would like. According to Peelen and Beltman choosing one discipline never allows a company to totally disregard the other two. A basic level on other stages has still to be reached. “A product leader has to be at least operationally excellent to the level of most competitors for it to be seen as a reliable organisation, offering state of the art products and services at a realistic price.” (Peelen & Beltman, 2013) However, in their studies Treacy and Wiersema do recommend that the three value disciples described above should not be combined. Since it is difficult to excel in every area and moreover because excellence in all three of the dimensions would create conflicts between them.

In conclusion; However a defensive strategy is highly recommended for hotels due to the focus on customers rather that competition and marketshare, it is important to realise that aiming for a defensive strategy is only realistic once state of operational excellence and customer intimacy are achieved. The infrastructure created by this will give the opportunity, once further developed, to expand knowledge of the individual customer and using it in contact with this individual. “By keeping track of communication and transactions, the supplier increases its insight into the customer. They supplier can truly benefit from customer knowledge it acquires during its interactions with the customer, and in a relatively inexpenciseve way; it can supply more customisation, bid farewell to the transaction orientation, and focus on increasing the value of individual customers.“ (Peelen & Beltman, 2013)

 

Sources:

Peelen, E., & Beltman, R. (2013). Customer Relationship Management. Pearson.

Treacy, M., & Wiersema, M. (1996). The Discipline of Market Leaders. HarperCollins.

 

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2 thoughts on “A defensive CRM strategy, what is it and what is needed for a defensive strategy?”

  1. Lieke, this is an interesting strategy related subject. The connection with the sector you chose is unfortunately not clear and neither does it really address customer engagement management. I really miss some industry examples. Would you please update this blog and add the categories?

    Like

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