What is 'Customer Relationship Management - CRM'
Customer relationship management (CRM) refers to the principles, practices and guidelines that an organization follows when interacting with its customers. From the organization's point of view, this entire relationship encompasses direct interactions with customers, such as sales and service-related processes, and forecasting and analysis of customer trends and behaviors. Ultimately, CRM serves to enhance the customer's overall experience.
With the growth of the Internet and related technologies, customers are concerned over the privacy and safety of their personal information. Therefore, businesses need to ensure the storage and analysis of their customer data has the highest levels of protection against cyber criminals, identity theft and other breaches of security.
BREAKING DOWN 'Customer Relationship Management - CRM'
Elements of CRM range from a company's website and emails to mass mailings and telephone calls. Social media represents one way companies adapt to trends that benefit their bottom line. The entire point of CRM is to build positive experiences with customers to keep them coming back so a company creates a growing base of returning customers.
Special CRM software aggregates customer information in one place to give businesses easy access to data, such as contact data, purchase history and any previous contact with customer service representatives. This data helps employees interact with clients, anticipate customer needs, recognize customer updates and track performance goals when it comes to sales. CRM software's main purpose is to make interactions more efficient and productive. Automated procedures within a CRM module include sending a sales team marketing materials based on a customer's selection of a product or service. Programs also assess a customer's needs to reduce the time it takes to fulfill a request.
Cloud-based systems provide real-time data to sales agents at the office and in the field as long as a computer, smartphone, laptop or tablet connects to the Internet. The convenience of this type of system has a trade-off. If the company goes out of business or faces acquisition, access to customer information may become compromised. A business might have compatibility issues when and if it migrates to a different vendor for this kind of software. Typically, cloud-based CRM programs cost more than in-house programs.
All of the computer software in the world to help with CRM means nothing without proper management and decision-making from humans. Plus, the best programs organize data in a way that humans can interpret readily and use to their advantage. For successful CRM, companies must learn to discern useful information and superfluous data, and weed out any duplicate and incomplete records that may give employees inaccurate information about customers.