Customer relationship management

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Definition, Importance, and History of CRM
– CRM is a process that administers interactions with customers using data analysis
– CRM systems compile data from various communication channels
– CRM helps businesses learn about their target audiences and cater to their needs
– CRM can be used with past, present, or potential customers
– The global CRM market size is estimated at $69 billion in 2020
– CRM concept started in the early 1970s with customer satisfaction surveys
– Farley File was a precursor of modern-day CRM, developed in the 1970s
Database marketing concept introduced in 1982
– ACT! introduced in 1986 as a contact management system
– First CRM product, Siebel Customer Relationship Management, designed in 1993

Types and Components of CRM
– Strategic CRM focuses on developing a customer-centric business culture
– Operational CRM integrates and automates sales, marketing, and customer support
Sales force automation automates sales cycle stages and tracks customer interactions
Marketing automation streamlines marketing processes and engages customers
– Service automation supports customers through various channels
– Analytical CRM systems analyze customer data to inform decision-making
– Techniques like data mining and pattern recognition are used in analytical CRM
– Analytical CRM helps improve customer service and target specific consumer audiences
– It identifies small problems that can be solved to enhance customer satisfaction
– Analytical CRM plays a role in improving business performance
– Building and managing customer relationships through marketing is a key component of CRM
– Observing relationships as they mature through distinct phases is important in CRM
– Managing relationships at each stage is crucial in CRM
– Recognizing the value distribution of customer relationships is an essential aspect of CRM
– Relational intelligence, which focuses on reinforcing or changing customer connections, is crucial in CRM

CRM Trends and Developments
– Open-source CRM system developed by SugarCRM in 2004
– CRM systems migrated to the cloud for accessibility and cost reduction
– Social CRM solutions emerged to leverage social media platforms
– Integration of CRM with business intelligence and communication software
– Customizable and industry-specific CRM solutions are growing in popularity

Customer Benefits and Effect on Customer Satisfaction
– CRM systems lead to better customer service on a day-to-day basis
– Reliable information reduces the need for customers to interact with the company for problem resolution
– CRM provides enhanced ability to target profitable customers
– Integrated assistance across channels improves customer experience
– CRM improves sales force efficiency, pricing, and customer service effectiveness
– CRM approach has implications for customer satisfaction and customer knowledge
– CRM applications help firms customize their offerings for each customer
– Customization enhances perceived quality and indirectly affects customer satisfaction
– CRM applications enable timely and accurate processing of customer orders and requests
– CRM applications help firms manage customer relationships effectively across different stages

CRM Implementation and Examples
– Improved customization of marketing leads to customer satisfaction
– Multichannel integration enhances customer value creation
– CRM saves time by enabling personalized and timely communication
– CRM improves customer knowledge for better product development
– CRM contributes to competitive advantage through customer information collection
– A 5% increase in customer retention boosts lifetime customer profits by 50%
– MBNA Europe achieved 75% annual profit growth through CRM strategies
– Amazon’s CRM implementation led to 80% customer repeat rate
– Proper customer profiling helps in marketing and advertising decisions
– Customer analytics methods aid in designing customer-centered businesses References:https://en.wikipedia.org/wiki/Customer_relationship_management

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Customer relationship management