Introduction And Meaning Of Customer Relationship Management(CRM)
Customer relationship management (CRM) refers to the management strategy that helps to maintain strong bond between a business firm and its customers. It collects customers data (about their needs, preferences, buying history etc.) to improve customers service that helps to increase customer satisfaction. A good customer relationship management helps to increase the goodwill, image and value of the company.
Features Of CRM
The essential features of customer relationship management are as follows:
- It should be able to identify the needs and expectations of the customers
- It should improve customer experience and satisfaction
- CRM should be able to organize customers' data and information in productive manner
Need Or Importance Of Customer Relationship Management (CRM)
The main importance of CRM can be pointed out as follows:
1. Data Collection
CRM is important to collect useful data and information regarding customer needs, preferences, buying habit, buying behavior etc. that helps the management to design production, marketing and selling strategies.
2. Understanding Of Customers
As we know that CRM is customer-oriented strategy that gathers detail information about the customers, it helps the firm to understand the behavior of its customers.
3. Better Service
Customer relationship management collects, organizes and analyzes the the data of both existing and potential customers that helps to identify their needs, wants, concerns etc. It helps the firms to provide personalized services to the customers. So, it encourages better customer service.
4. Greater Customer Satisfaction And Loyalty
Another importance of CRM is that it increases customer satisfaction because of better understanding and customer services. Increase customer satisfaction helps to improve customer loyalty that helps to retain existing customers and attract new ones.
5. Sound Decision Making
Customer relationship management helps the top management to make better decision by providing customer related data and information. It helps the firms to design production and sales strategy and also assists management to formulate plans and policies.
6. Decreased Costs
Because of increases customer loyalty and satisfaction it helps to increases sales and revenue of the business. Increased sales leads to increases the volume of production that helps to reduce the cost of production cost. It also minimizes selling and marketing expenses. Therefore, CRM helps to decrease manufacturing, selling and marketing expenses.
7. Increased Image And Goodwill
Because of improved customer satisfaction and loyalty it increases the image and goodwill of the firm. It also provides growth and expansion opportunity.
