Customer relationship management

Customer relationship is not a new concept; companies have been interacting and dealing with customers since the inception of trade. Earlier more focus and attention was on product and services instead of customer centric. With increase in competition because of globalization and usage of internet changed the picture of business. Customers have variety to choose from, more knowledge about the companies and products surely has titled power at customers’ side. With this scenario, companies realize the need of treating customers with utmost care. Therefore, searching for innovative ways to manage relationships effectively, not only to acquire new customers but also to retain the existing one. â€Å"CRM is the process of managing detailed information about individual customers and carefully managing all the customer ‘touch points’ with an aim of maximum customer loyalty† Acquiring new customers can cost five times more than costs involved in satisfying and retaining current customers. More companies are recognizing the importance of satisfying and retaining customers, which constitute the company’s relationship capital To retain the customers’ better approach is to deliver high customer satisfaction. Customer relationship management is about taking a long term approach to building relationships with customers. In olden days, business people and organizations would know their customer base from seeing them on a daily basis and learning their preference based on the relationship they shared with the customers. CRM is emerged as critical for organization in 1960’s where marketers found that 4p’s of marketing framework-product, price, place and promotion were less valuable without ongoing relationships with customers. Companies started putting customers in the middle of marketing program. In early days of CRM, there was no technology to support what companies were doing. CRM is not new, over the years companies has had to figure out how to build relationships with customers and lead to brand loyalty. The goal in CRM is to evolve from a mass marketing model, which was on product centric market structure to customer centric structure. Managing customer relationships successfully means learning about the habits and needs of your customers anticipating future buying patterns, finding new opportunities to add value to the relationship. Successful companies make the relationship something the customer values more than anything else they could receive from the competition. Company experience with customer not only with transactions but also with interaction like website visit, phone, call center and by direct mail. CRM helps in developing marketing programs that make sense to each customer segment, support cross-selling and customer retention programs, help to maximize the value of each customer’s interaction and deliver a consistent branding message by aligning products and services within each channel. CRM provides an integrated view of a company’s customer to every one in the organization so that customer can be serviced effectively. CRM helps companies to gather and access information about the customers’ buying histories, preferences, complaints. It allows tracing the needs of the customers and means to satisfy them effectively. The following are the aims of CRM: †¢ Increase efficiency of the organization †¢ Ability to provide quicker response to customer queries and complaints †¢ Getting insight of customer needs †¢ Providing more cross-selling opportunities †¢ Organized information to manage and lead †¢ Reduction in cost and increase in productivity †¢ Receiving customer feedback †¢ Providing common platform for customer communication and interaction. Today consumers are more educated, more and better informed, more technology savvy coupled with increase competition in the market. Organization needs to build a system which allows you to track, capture and analyze the millions of customer activities, both interactions and transactions, over a long period of time. This helps in creating promotions, developing new products and designing communication programs to attract and retain customers. By 1980s â€Å"relationship marketing â€Å"was used to describe this new focus of understanding customer segments, delivering ongoing quality service and high customer satisfaction. In 1990s computer systems were deployed to support sales and service process. Sales force automation system evolved while customer service and support systems became backbone of automated call centers. By late 1990s increase in internet usage supported e-business applications to manage online customer and partner relationships, called as e-CRM and partner relationship management. CRM emerged as discipline of set of discrete software and technologies that focus on automating and improving the business processes associated with and improving the business processes associated with managing customer relationships in the areas of sales, marketing, customer-service and support. Customer relationship management applications are most active software available to the organizations. Three converging trends have enabled the emergence of CRM applications as a major force in the market place. The fist trend is the availability of robust, scale decision support technology. This helps companies collect vast quantities of data from multiple, heterogeneous sources, such as accounting, manufacturing, human resources, sales force automation, and customer service applications. This provides the technological foundation for building a consolidated enterprise wide view of the customer. The second trend is the emergence of front-office applications. This focus on the sales and the marketing departments, and essentially transactional in nature. The third trend is the emergence of the one-to-one marketing phenomenon has helped companies to have their marketing activities focus on customer, rather than on their products, distributors, sales force or suppliers. Now â€Å"Multi channel CRM† systems available to support direct, internet and partner channels, while allowing users to use whatever mode of communication they are pleased. CRM started with marketing era focusing on customer needs and wants and satisfying it effectively which drive changes in the organization and work processes. It must start with a business strategy. CRM is really about using tools not only to achieve the personal relationships business but even to predict and serve the future needs. Major support and change came for CRM is technology break through since two decade which played a significant part in not only managing good relationship with customers but also with the partners of the organizations.