Customer relationship management

From Wikipedia, the free encyclopedia

You have new messages (last change).
This article or section appears to contain a large number of buzzwords and may require cleanup.
Please help rewrite this article to make it more concrete and meaningful, removing tautologies, obvious statements and excessive abstraction. (talk)

Customer relationship management (CRM) is a broad term that covers concepts used by organizations to manage their relationships with customers, including collecting, storing and analyzing customer information.

Contents

[edit] Aspects of CRM

There are four aspects of CRM, each of which can be implemented in isolation:

  1. Active CRM: A centralized database for storing data, which can be used to automate business processes and common tasks.
  2. Operational CRM: The automation or support of customer processes involving sales or service representatives
  3. Collaborative CRM: Direct communication with customers not involving sales or service representatives (“self service”)
  4. Analytical CRM: The analysis of customer data for a broad range of purposes



[edit] Operational CRM

Operational CRM provides support to "front office" business processes, including sales, marketing and service. Each interaction with a customer is generally added to a customer's contact history, and staff can retrieve information on customers from the database as necessary.

Focus on customers value is key to a successfull CRM strategy. Different customers have to be treated differently. Variables like customers ranking, actual value and potential value are strategy drivers.

[edit] Collaborative CRM

Collaborative CRM covers the direct interaction with customers. This can include a variety of channels, such as internet, email, automated phone/ interactive voice response (IVR). It can generally be equated with “self service”.

The objectives of Collaborative CRM can be broad, including cost reduction and service improvements. Driven by authors from the Harvard Business School (Kracklauer/Mills/Seifert), Collaborative CRM seems to be the new paradigm to succeed the leading Efficient Consumer Response and Category Management concept in the industry/trade relationship. Many organizations are searching for new ways to use customer intimacy to gain and retain a competitive advantage. Collaborative CRM provides a comprehensive view of the customer, with various departments pooling customer data from different sales and communication channels.

Collaborative CRM also includes Partner Relationship Management (PRM) which enables organizations to manage their relationships with partners (consultants, resellers and distributors), and potentially the customers of those partners.

[edit] Analytical CRM

Analytical CRM analyzes customer data for a variety of purposes including:

  • design and execution of targeted marketing campaigns to optimize marketing effectiveness
  • design and execution of specific customer campaigns, including customer acquisition, cross-selling, up-selling, retention
  • analysis of customer behavior to aid product and service decision making (eg pricing, new product development, etc)
  • management decisions, e.g. financial forecasting and customer profitability analysis
  • risk assessment and fraud detular for credit card transactions

Analytical CRM generally makes heavy use of Predictive analytics.

[edit] Strategy

Several commercial CRM software packages are available which vary in their approach to CRM. However, CRM is not just a technology, but rather a holistic approach to an organization's philosophy in dealing with its customers. This includes policies and processes, front-of-house customer service, employee training, marketing, systems and information management. CRM therefore also needs to consider broader organizational requirements.

A company's CRM strategy is dependent on both the company’s current situation and the needs and expectations of its customers.

[edit] Technology considerations

The technology requirements of a CRM strategy are very complex and far reaching. The basic building blocks include:

  • A database to store customer information. This can be a CRM specific database or an enterprise data warehouse.
  • Operational CRM requires customer agent support software.
  • Collaborative CRM requires customer interaction systems, eg an interactive website, automated phone systems etc.
  • Analytical CRM requires statistical analysis software, as well as software that manages any specific marketing campaigns.
  • Support CRM systems require interactive chat software to provide live help and support to web site visitors.

[edit] Successes

While there are numerous reports of "failed" implementations of various types of CRM projects, these are often the result of unrealistic high expectations and exaggerated claims by CRM vendors.

[edit] Privacy and Data Security

The data gathered as part of CRM must consider customer privacy and data security. Customers want the assurance that their data is not shared with 3rd parties without their consent and not accessed illegally by 3rd parties.

Customers also want their data used by companies to provide a benefit for them. For instance, an increase in unsolicited telemarketing calls is generally resented by customers while a small number of relevant offers is generally appreciated.

[edit] Customer relationship management software

Customer relationship management software is defined as business management and automation of the front-office divisions of an organization. CRM software is essentially meant to address the needs of Marketing, Sales & Distribution and Customer Service and Support divisions within an organization and allow the three to share data on prospects, customers, partners, competitors and employees. The purpose of CRM software is to manage the customer through the entire lifecycle, i.e. from prospect to qualified opportunity to order.

CRM software automates many of the needs of Marketing, Sales and Support users, such as Telephony, or the ability to conduct phone calls and manage call data, and tools to capture, share and manage automated alerts on lead data as it passes through the sales pipeline. CRM software provides a standard framework for pushing leads through a sales pipeline and managing it amongst many stakeholders in real time, in order to provide better customer relations and grow revenues by creating more sales, and losing fewer customers.

CRM software helps organizations achieve their customer relations goals by measuring key performance indicators collected by the CRM software about customer lifecycle behaviour. Benefits include isolating those marketing campaigns that drove the most and best quality leads, improving internal efficiency, complete customer histories and the ability to provide appropriate support and consequently retain customers.[citation needed]


[edit] References

    [edit] See also

    [edit] External Links

    Retrieved from "http://en.wikipedia.org../../../c/u/s/Customer_relationship_management.html"