Customer-relationship management is an approach to manage a company’s interaction with current and potential customers. It uses data analysis about customers’ history with a company to improve business relationships with customers, specifically focusing on customer retention and ultimately driving sales growth.
One important aspect of the CRM approach is the systems of CRM that compile data from a range of different communication channels, including a company’s website, telephone, email, live chat, marketing materials and more recently, social media. Through the CRM approach and the systems used to facilitate it, businesses learn more about their target audiences and how to best cater to their needs.
The role of analytical CRM systems is to analyze customer data collected through multiple sources and present it so that business managers can make more informed decisions.Analytical CRM systems use techniques such as data mining, correlation, and pattern recognition to analyze the customer data. These analytics help improve customer service by finding small problems which can be solved, perhaps by marketing to different parts of a consumer audience differently. For example, through the analysis of a customer base’s buying behavior, a company might see that this customer base has not been buying a lot of products recently. After scanning through this data, the company might think to market to this subset of consumers differently, in order to best communicate how this company’s products might benefit this group specifically.
With Customer relationship management systems customers are served better on a day to day process and with more reliable information their demand of self service from companies will decrease. If there is less need to interact with the company for different problems, customer satisfaction level increases. These central benefits of CRM will be connected hypothetically to the three kinds of equity that are related, value and brand, and in the end to customer equity. Eight benefits were recognized to provide value drivers.
- Enhanced ability to target profitable customers.
- Integrated assistance across channels
- Enhanced sales force efficiency and effectiveness
- Improved pricing
- Customized products and services
- Improved customer service efficiency and effectiveness
- Individualized marketing messages also called campaigns
- Connect customers and all channels on a single platform.