Basic Introduction to CRM
CRM is an acronym for customer relationship management. Rather than single system or product, CRM describes the way that a company keeps track of its customer base, in order to improve service to its present customers and to attract new ones. Companies interact with customers on a number of levels: internet, email, social networking, telephones, and more. With all of this information about their customers coming in, businesses need ways to keep track of it and to develop initiatives to increase customer satisfaction. They also need to be able to respond in the appropriate manner when their customers change their spending habits.Seeing the increasing role that customer relationships are playing in the digital world, companies have developed software specifically to address these issues. CRM software can keep track of things from inventory and customer-employee interaction to marketing and finance. It can also keep track of customers by recording their purchases, personal information, results of customer surveys, and consumer behaviors and habits. CRM solutions analyze those changes to allow the business to adjust its marketing strategy with that customer. Since customers usually see a business as a single entity, CRM allows businesses to act as a single entity, providing a unified strategy for interacting with the customers.
There are many types of CRM solutions. Operational CRM manages marketing campaigns. It supplies support to front office operations, such as direct interaction with the customers. Analytical CRM heavily relies on data compiled from customer behavior. This allows the business to tailor up-selling, cross-selling, switch-selling, pricing, and marketing campaigns for its customers. Sales intelligence CRM is similar to analytical CRM, but it is used more as a direct marketing tool, in that it includes sales alerts for the sales staff regarding customer trends. Campaign CRM contains elements from both the operational and analytical CRM. It targets groups from the customer base that fit predetermined criteria and sends campaign material to those customers via phone, email, SMS, and post.
It also stores and analyzes campaign statistics and tracks responses. Collaborative CRM deals with the company's interactions with the customers through the various departments within the company, such as sales, technical support, and marketing. Consumer relationship CRM deals with a company's interactions with the customers that are handled through consumer affairs and the customer relations department within the company. Representatives handle inbound contact with consumers regarding product issues and track customer sentiment. Social CRM uses social networking web sites such as MySpace, Facebook, and Twitter to interact with customers and gauge customer sentiment.
The cost of CRM varies greatly. A hosted CRM solution can be initiated and operational in as little as 30 to 90 days. This service can cost from $65 to $150 per month and higher, depending on the functionality a company is looking for. On-premise CRM solutions are also available. They entail purchasing and installing software and servers and running the programs in-house. A license must be purchased for each computer that will access the software. Training employees to use the software and implementation could take anywhere from a few months to a few years. The cost can run from several thousand to several million dollars, depending on the size and complexity of the company's needs.
Consumer trends are constantly changing, and businesses need a way to keep up with those changes and remain competitive. CRM software responds to those needs, and as it its evolves, it is revolutionizing the business world.
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