Customer Relationship Management (CRM) is a strategy for managing all your company’s relationships and interactions with your customers and potential customers. It helps you improve your profitability.
Importance of Customer Relationship
- Costs 6 times more to sell to new customer than to existing one.
- Odds of selling a product to new customer: 15%;
- odds of selling to existing customer: 50%
- 70% of complaining customers will do business with the company again if it quickly takes care of service aspects.
Small business– possible to know customers on personal basis
Large business- many customers & different ways customers interact. Processes for sales, service & marketing- highly compartmentalized; do not share essential customer information.
CRM Systems Benefits
- Integrate, consolidate & analyze customer data & distribute results.
- Give complete view of each customer.
- Increases effectiveness of marketing campaigns.
Customer Relationship Management(CRM) Systems
CRM systems provide tools for answering :
- “What is lifetime value of a particular customer”
- “Who are our most loyal customers?“ and
- “What do profitable customers want to buy?”
Firms use answers to:
- Acquire new customers
- Provide better services
- To existing customers §Retain profitable customers
CRM Cycle
CRM Cycle has Five process stages:
- Target & Marketing
- Development of offerings
- Sales
- Superior Experience
- Retention & Win back
A CRM System
Sales Force Automation
- Help sales staff to focus efforts on most profitable customers
- Assemble information about particular customer’s past purchases; helps make personalized recommendations.
- Have capabilities for sales forecasting, territory management & team selling.
Marketing Module
Supports direct-marketing campaigns by providing capabilities for
- Capturing prospect & customer data
- Identifying profitable & unprofitable customers
- Designing products & services to satisfy specific customer needs & interests
Customer Service Modules
Provide information & tools to increase efficiency of call centers, help desk & customer support staff.
- Improved access to accurate customer information help call centers handle more calls/ day. Hence greater productivity.
- Customer spends less time on phone restating his/her problem to customer service reps.
Business Value of CRM Systems
- Increased customer satisfaction
- Reduced direct-marketing costs
- More effective marketing, and
- Lower costs for customer acquisition & retention.
CRM Implementation Framework
- Understand your Business & Customer
- Do SWOT Analysis
- Define CRM System Strategy for Your Organization
- Make Your Organization Business Process Reengineer Ready
- Plan Implementation of CRM System
- Top Management Support