Customer Relationship Management (CRM), is a process of collecting maximum information about the customers and prospective customers, to enhance customer experience, ultimately leading to customer loyalty and higher sales. It involves the collection of customer data, through all direct or indirect communication with the customers such as through email, chat, telephone, website, marketing communications, social media, personal contact with sales and customer service staff, etc.
In the early days of CRM, companies used to conduct Customer Satisfaction Surveys, to identify the degree of customer satisfaction. With developments in software technology, companies started to use more advanced and broader metrics, to measure customer satisfaction. A typical Customer Relationship Management software, captures customer information, such as his name, date of birth, address, phone number, email address, education, marital status, etc. It also maintains a record of all interactions with the customers, such as during sales transactions, customer service interactions, lead generation, etc. The information gathered in such a way is recorded and analysed for trends and patterns. This helps the company to design an appropriate product or service, which will be widely accepted. It also helps the company to decide, which customer segment or segments to focus on, in terms of age composition, income, education, geographical locations, etc. The company can use this information to improve customer experience and increase sales.
A typical CRM software, automates and integrates the process of marketing, sales and customer service. Marketing efforts can be channelized to particular customer segments or geographies. The marketing process can be customized, based upon customer needs and expectations. The marketing department can use customer related data to design communication strategies, and send newsletters, messages and greetings. The sales process can also be streamlined and duplication of efforts can be reduced. A record of all interactions with prospects and clients helps to improve sales pitch and increase customer acquisition. A record of customer data, which includes customer’s profile, sales numbers, product wise sales records, frequency of purchase, etc., can be maintained. The customer service department can improve its level of service, by studying customer’s profiles and past interactions. They can maintain a record of customer grievances and address the concerns, promptly. An analysis of customer grievances helps to understand trends or defects in the company’s products or services. Such information can be used by the company to make changes in the products or services before it becomes a problem for the company.
CRM software includes a data warehouse, where customer data is stored. Software companies now offer cloud based CRM solutions, which can be accessed from any part of the world. This reduces the need to store customer data in company’s own servers or data centres. Also a common platform can be used, at a national or global level. The software can also be customized as per local or regional preferences. CRM can be looked upon as an extension of the traditional ERP softwares, which are used to manage and integrate other core sections of the business, such as production, procurement, distribution, human resources, finance, etc. Thus we can look upon a CRM software, as an ERP software, which specialises in marketing, sales and customer service.
All large and small businesses, globally, use CRM software to manage their customer’s needs and expectations. In today’s highly competitive markets, CRM softwares are an absolute necessity to understand customer’s needs, design better products and services and meet customer expectations.