What is Customer Relationship Management (CRM)?

Customer Relationship Management (CRM) is a business strategy software that effectively builds a strong relationship between companies and their customers. This was intended to increase sales and improve overall customer satisfaction and was implemented through technology and software. CRM software allows businesses to manage and analyze customer data, interactions, and past transactions. The implementation of CRM begins with collecting and organizing customer data that include essential contact information, such as full name and address, as well as information about customer interactions. This information includes phone calls, emails, and purchase history. Then, the data will be compiled to create a detailed customer profile to identify patterns and trends in customer behavior.

One of the key benefits of using CRM is that it allows businesses to understand better and target their customers. Companies can identify their most valuable customer by analyzing customer data and developing targeted marketing campaigns to attract new customers. Additionally, by tracking customer interactions, businesses can identify areas where they may need to improve customer satisfaction and improve to retain current customers. Besides that, CRM allows companies to enhance their sales and marketing efforts. By tracking customer interactions, they can identify leads and opportunities for sales. Last but not least, CRM software also allows businesses to streamline their operations. This can be done by automating many of the manual tasks associated with customer management, such as data entry and tracking, so that they can save time and money.

There are several types of CRM in the market. The first one is Operational CRM, a component that supports front-office business processes. It is divided into two major components, which are customer-facing applications and customer-touching applications. A customer-facing application focuses on the application where a sales, field service, and customer interaction representative did actually interact with customers.

An operational CRM includes customer service and supports (refers to system automate requests, complaints, product return, and information request), sales force automation (refers to aspect records in sales transaction process), marketing (refers to marketing techniques such as cross selling, up selling, and bundling), and campaign management applications (refers to help organization plan campaign so the message is delivered perfectly). While a customer-touching application focuses on the application where customers interact directly with online technologies and application. This includes things such as search and comparison capabilities, technical information, customized products, Frequently Asked Questions (FAQs), email, automated response, and loyalty program.

Besides that, we also have Analytical CRM. An Analytical CRM basically analyze customer behaviors and perceptions to provide an actionable business intelligence. It will analyze customer data for a variety of purposes, includes designing and executing targeted marketing campaigns, increasing customer acquisition, cross selling, up selling, providing input to decisions relating to product and services, and providing financial forecasting with customer profitability analysis in detail. There are also other types of CRM in the market, such as On-demand CRM, Mobile CRM, Open-source CRM, Social CRM, and Realtime CRM.

However, it is important to note that CRM is not just a technology. It is a strategy that involves the entire organization to execute the strategy. The CRM Strategy should be aligned with the overall business strategy and organization should be able to develop a clear plan to implement and maintaining the CRM system. The plan should include all the objectives of organization, process of data collection, process of data analysis, process of decision-making, and process of communication. The organization should also train their employees on how to use CRM System and how to handle their customer data.

References:

https://www.salesforce.com/ap/solutions/small-business-solutions/win-customers/     

R. KELLY RAINER JR., BRAD PRINCE (2022). Introduction to Information Systems. United States: John Wiley & Sons, Inc.