Nature and significance of customer relationship management

Customer relationship management

nature and significance of customer relationship management

Customer Relationship Management concept is tendency of banking sector to whose priority is to retain existing customer base as an important business. Are you planning to become one of the successful business owners in the future? If you claim it, you must have an idea about Customer Relationship. Customer Relationship Management: Meaning, Need and Techniques of Building CRM! Meaning and Definition: Customer satisfaction has always been a key.

Most of the organizations have dedicated world class tools for maintaining CRM systems into their workplace.

What is CRM?

Looking at some broader perspectives given as below we can easily determine why a CRM System is always important for an organization. A CRM system consists of a historical view and analysis of all the acquired or to be acquired customers.

nature and significance of customer relationship management

This helps in reduced searching and correlating customers and to foresee customer needs effectively and increase business. CRM contains each and every bit of details of a customer, hence it is very easy for track a customer accordingly and can be used to determine which customer can be profitable and which not. In CRM system, customers are grouped according to different aspects according to the type of business they do or according to physical location and are allocated to different customer managers often called as account managers.

This helps in focusing and concentrating on each and every customer separately. A CRM system is not only used to deal with the existing customers but is also useful in acquiring new customers. Some of the techniques have been discussed in detail.

What is a CRM system?

Data Warehousing and Data Mining: CRM analysts develop data warehouses and use data-mining techniques to develop and maintain long- lasting relationships with the valuable customers.

The purpose of data warehouse is not just to gather information, but to place it into a central location for easy access. Once the data warehouse locates the data at a central place, the data analysts use data mining techniques to examine the mounds of data to find out interesting facts of the customers.

The mined data can be utilized for various marketing decisions such as the following: Product design and modification 2. Selection of channels of distribution 5. Some firms adopt one-to-one marketing strategy. Such firms treat their customers as partners, especially in the case of B2B markets firms solicit the help of customers to design new products or to improve their services.

If the customer gets involved with the firm, then they are more likely to remain with the firm. Firms may use variety of loyalty programmes to retain customers.

Firms may also provide gifts and other benefits to the loyal customers. But it is to be noted that all loyal customers need not be profitable, and all profitable customers need not be loyal.

Customer relationship management

Therefore, the firm must be selective. In order to enhance marketing efficiency, a firm has to find out which of its customers are worth retaining and which are not, and which customers should be given extra care and attention.

In other words, the firm has to determine the value of its customers, and focus on MVCs accordingly. Some firms introduce priority customer programmes. The priority customers are the MVCs. They are given priority in after-sales service, delivery and resolving complaints.

The priority customer programmes are followed by several organizations, especially in the banking industry.

nature and significance of customer relationship management

For example, Citibank maintains a list of priority customers and provides them with additional facilities special offers such as free ticket to concerts, movies, and so on. Need for Customer Relationship Management Customer Relationship Management leads to satisfied customers and eventually higher business everytime.

Customer Relationship Management goes a long way in retaining existing customers. Customer relationship management ensures customers return back home with a smile.

Customer relationship management improves the relationship between the organization and customers. Such activities strengthen the bond between the sales representatives and customers. Steps to Customer Relationship Management It is essential for the sales representatives to understand the needs, interest as well as budget of the customers. Never tell lies to the customers. Convey them only what your product offers.

Importance of Customer Relationship Management (CRM)

It is a sin to make customers waiting. Sales professionals should reach meetings on or before time. Make sure you are there at the venue before the customer reaches.