Customer Relationship Management
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In Customer Relationship Management, companies concentrate on their customers and the processes and relationships associated with them.
Basis of Customer Relationship Management
Customer relationship management is based on extensive data on customers, which is gained for example through personal conversations, sweepstakes, customer cards or orders. The data is recorded in databases and can be retrieved and evaluated. In addition to personal data such as address or date of birth, here are examples of other data that can be collected:
- Additional family members
- Personal preferences
- Preferred product categories for purchasing
- Previous complaints made
- Contact and purchase histories
- Education level
- Social status
- Hobbies, political attitudes, clubs or drinking habits
Depending on the context, this data can be used to respond more precisely to the wishes and needs of customers. The more data available, the greater the analytical evaluation possibilities, and the more useful the data are for the entrepreneur.
To be able to implement customer relationship management in the most ideal way, CRM software is required. This is a database application that enables access to the stored data as well as its collection and maintenance. The CRM software is often integrated into an ERP software, so that purchase histories are available in CRM on a daily basis. In addition, the redundant storage of data in two databases can be prevented.
Advantage of CRM
An important advantage of a CRM system is that all employees have access to the same information. Using the contact history, one employee will be able to see what a customer had previously agreed with another employee weeks or months before. Individual and tailor-made offers can be submitted to the customer on the basis of purchasing behavior and customer preferences. Emails and offers can be more personalized, which increases the chances of success and could potentially increase the conversion rate.
Risks of Customer Relationship Management
There are also risks involved with customer relationship management. Great attention must be paid to data protection issues. Since CRM systems collect a great deal of personal data from people who are usually only partially aware of this, the entrepreneur is responsible for preventing data misuse. The intention to introduce a customer relationship management system is also risky with regard to the prospects of success. Nearly every second introduction fails due to various problems, such as the resistance of the workforce, the lack of cooperation on the part of management or the underestimation of the data volume.
Social CRM / Mobile CRM
Social CRM is an extension of classic CRM for communication channels on the Internet, such as Facebook. The aim is to respond even faster to customer needs, wishes and suggestions that are communicated via social networks. In addition, these channels can be used to collect additional customer data, such as photos, information and responses to company posts.
Mobile CRM is also a special form of Customer Relationship Management, where the focus is on the mobile Internet. For example, it enables employees in Sales and Distribution to access the customer data so that they can access it on the move.