Customer Relationship Management

Customer Relationship Management

CUSTOMER RELATIONSHIP MANAGEMENT

"It costs five times more to acquire a new customer than to retain one"

Customer relationship management (CRM) consists of the processes a company uses to track and organize its contacts with its current and prospective customers. Customer Relationship Management continues to be the most vibrant, critical and evolving technology category in today's market. Typical CRM goals are to improve services provided to customers, and to use customer contact information for targeted marketing.

Types of CRM

1) Operational CRM

Operational CRM provides support to "front office" business processes, e.g. to sales, marketing and service staff. Interactions with customers are generally stored in customers' contact histories, and staff can retrieve customer information as necessary.

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2) Sales Force Automation (SFA)

Sales Force Automation automates sales force-related activities such as:

• Activity Management: Scheduling sales calls or mailings

• Tracking responses

3) Analytical CRM

Analytical CRM analyzes customer data for a variety of purposes:

• Designing and executing targeted marketing campaigns

• Designing and executing campaigns, e.g. customer acquisition, cross-selling, up-selling

• Analyzing customer behavior in order to make decisions relating to products and services (e.g. pricing, product development)

• Management information system (e.g. financial forecasting and customer profitability analysis

4) Collaborative CRM

Collaborative CRM covers aspects of a company's dealings with customers that are handled by various departments within a company, such as sales, technical support and marketing.

5) Consumer Relationship CRM

Consumer Relationship System (CRS) covers aspects of a company's dealing with customers handled by the Consumer Affairs and Customer Relations contact centers within a company

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6) Geographic CRM

Geographic CRM (GCRM) combines geographic information system and traditional CRM. Geographic data can be analyzed to provide a snapshot of potential customers in a region or to plan routes for customer visits.

Benefit of CRM

• Provide better customer service

• Increase Customer Revenue

• Increase Customer Life-Cycle Value

• Discover New Customers

• Help Sales Staff to close deal fast

• Simplifying Marketing and Sales Process

• Make Call Centre more effective

Implementation of CRM

Many CRM project "failures" are also related to data quality and availability. Data cleaning is a major issue. If a company's CRM strategy is to track life-cycle revenues, costs, margins, and interactions between individual customers, this must be reflected in all business processes. Data must be extracted from multiple sources (e.g., departmental/divisional databases such as sales, manufacturing, supply chain, logistics, finance, service etc.), which requires an integrated, comprehensive system in place with well-defined structures and high data quality. Data from other systems can be transferred to CRM systems using appropriate interfaces.

Because of the company-wide size and scope of many CRM implementations, significant pre-planning is essential for smooth roll-out. This pre-planning involves a technical evaluation of the data available and the technology employed in existing systems. This evaluation is critical to determine the level of effort needed to integrate this data.

Equally critical is the human aspect of the implementation. A successful implementation requires an understanding of the expectations and needs of the stakeholders involved. An executive sponsor should also be obtained to provide high-level management representation of the CRM project.

An effective tool for identifying technical and human factors before beginning a CRM