Customer Relationship Management or CRM is the term used to refer the methodologies; internet capabilities as well as software which help a business handle the relationships of customers in an effective and organized way.
For instance, a business may create a database that would define their customers’ relationships for it to determine the services and products that are mostly needed by their customers.
CRM involves set of activities in which customer’s information are collected, stored, and processed. There are different strategies used to implement CRM.
Some businesses hired staffs that would only manage customers. These staffs are also responsible to strengthen and build up a strong bond with customers so the transaction will increase.
Understanding the basics of CRM can be quite complicated because of some processes involved. That is the reason why you need to focus and pay attention to the details because once you fail, this might be the cause of your business failure in the industry.
Types of Customer Relationship Management
There are different types of CRM. But, here are the major ones:
• Operational CRM-this type of CRM is related to a typical business function which involves customer services, sales or marketing, order management, automation management, and invoice or billing.
• Analytical CRM-this involves numerous activities which store, process, extract, interpret, capture as well as report data of customers to user.
• Collaborative CRM-this type of CRM deals with the importance of communication, collaboration and coordination.
Some types of CRM were designed to focus on specific details in businesses. Before you consider implementing CRM to your business, it would be wise to take note first its types.
Four Main Parts of CRM
• Retaining and Acquisition- each business should focus on retaining and acquisition of new customers. For you to acquire customers, it is necessary to concentrate on the former customers, lapsed customers, enquiries, existing buyers, referrals, and competitor’s customers.
• Differentiate and Understand- each company has tons of customers and each of them have different expectations and requirements. CRM helps by understanding the necessities of each customer so that your business will have the best support and service. For differentiating process, you need to undergo communication phase.
• Customize and Develop- in today’s market, each customer requires many things and differently. With CRM, you will modify or customize the services of your company in accordance to the current market trend. CRM provides new channels to attract more customers.
• Deliver and Interact- to implement CRM successfully, you have to prioritize interaction for you to deal with different kinds of customers.
Adoption Issues and Trends
In year 2003, there is a report that estimated the number of cost of budget spent for unused software. According to an organization, less than forty percent of about 1,300 participating companies had adopted end-users. It also shows that only few companies use CRM systems more often.
In a particular 2007 survey, 4/5 of senior executives have been reported to Customer Relationship Management use systems they have installed for their company and only 40% of these companies take advantage of the system.