History of CRM, CRM s Goal and the Role of Information Technology in CRM

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History of CRM, CRM's Goal and the Role of Information Technology in CRM

The stated goal of CRM is the capability to handle customer interactions consistently a cross channels and functions. This capability is critical to building loyal and profitable customer relationships (Anderson, 2000, p. 479). In highly competitive markets, cost cutting and competitive pricing strategies are likely to result in early wins in attracting customers from competitors. But in many service industries, especially where there are high switching costs, price advantages are unlikely to be a sufficient reason for customers moving between suppliers. In these situations, successful competitive strategies are likely to include developing strong relationships with customers and cross-selling them other services. This is one of the major goals of CRM.

Customer relationships have to be managed continuously for a profitable and optimal relationship between the firm and the customer. A common strategy needs to be developed for the management and use of all customer information. Information technology plays an important role in collecting, processing and using this customer information to attract, retain and win back customers. The management of customer information in companies and organizations is increasingly essential to the maximization of customer value through long-term relationships (Ahlert, Henning, "Enterprise Customer Management: Integrating Corporate and Customer Information") (Jenkins, 1999, pp. 255-256). Customer information can be used for different purposes, allowing a company to:

  • reduce overall marketing costs by developing and executing more effective targeted campaigns

  • increase customer satisfaction and retention by enabling service employees and call center representatives to be more responsive to customers

  • increase sales by offering products and services that meet the wants and needs of its best customers

  • improve customer communication by utilizing the customer's preferred communication channels

  • achieve a higher return on investment by increasing profitability per customer and sale

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Managing Data Mining Technologies in Organizations(c) Techniques and Applications
Managing Data Mining Technologies in Organizations: Techniques and Applications
ISBN: 1591400570
EAN: 2147483647
Year: 2003
Pages: 174

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