It’s hardly revolutionary to say that a business that has good relationships with its customers is likely to succeed. After all, a business with no customers is not likely to be around for long.
Relationships can be extremely complicated, especially when a business is trying to juggle relationships with customers at different stages of the purchasing funnel, with varying degrees of familiarity with their brand.
That’s where Customer Relationship Management, known as CRM, comes in.
As a concept, a CRM’s goal is to improve businesses’ relationships with their customers. This can be either through acquisition or retention.
In the 1970s, businesses recognised the importance of curating a relationship with their customers, and began an early form of relationship management, primarily using questionnaires and front line questioning. Data from this and early automated sales systems were placed into spreadsheets, allowing companies an overview of their customers and enabling data analysis to improve how companies interact with their customers.
Of course, a lot of business elements have gone digital since the 1970s, and our understanding of Customer Relationship Management is quite different too. The shift in how we look at CRM comes from the access technology grants us to customers and their data.
A CRM forms an important part of Enterprise Resource Planning (ERP) which is the integrated management of main business processes, as mediated by software and technology.
Like most things, a great deal of interaction with customers is now increasingly digitised and automated, meaning the different departments of a business will each have their own set of data on a customer. Modern CRM strategy provides a centralised platform to increase customer acquisition and retention through utilising accessible data.
The role CRM software plays in modern business has massively increased by the development of digital marketing. Previously, much of customer relationship management would take place once someone had become a customer. Now, the consumer data accessible by marketing technology applications means businesses can track potential customers as well as existing ones.
CRM software and strategy allows businesses to keep track and store all of their data from different departments in one place. This means every department will feed their customer data to a central store of data that can potentially be accessed by all other departments. This centralised platform for customer data allows companies to automate both internal and external processes.
In the digital age, it’s clear that the companies which better understand their customers and develop their relationships with them have a competitive advantage. CRM systems give companies a way to build their customer relationships and encourage customer loyalty.
In our next piece, we will explore the other numerous benefits offered by implementing CRM.