Customer Relationship Management (CRM)



Customer Relationship Management (CRM)

Introduction

With globalization amplifying, market saturation, competition and amplified through mergers and acquisitions, retailers are seeking competitive advantage through better coordination of customer relationships. This is not a novel idea, but seeking a competitive advantage through accelerated attachments with customers has taken on new life. Companies recognize that customer's attachments are units of a value inherent to the construction of customers, and finally identifying the customer value enhancement is the key to increasing the value of the company. Customer satisfaction is an outcome of customer expectations and perceived service quality. The level of customers' satisfaction is determined by what customer expects and the performance of the company. Customer satisfaction is closely related to the quality of the service provided to customers. This paper deals with the same phenomenon of Customer Relationship Management (CRM).

Background

CRM (Customer Relationship Management) as a business strategy is a very important decision in a company, as it involves a change in culture, attitude and way of working that involves every one of its members, from the processes and people, to the objectives and responsibilities. CRM is a business strategy that seeks to improve the company's performance by optimizing your relationship with your (s) segment (s) market, knowing, understanding and anticipating the needs of their customers and prospects (Fjermestad & Romano, 2006). However, its implementation takes time, knowledge, experience, risks and costs.

From a holistic perspective, an organisation's strategic CRM plan provides analytical and operational direction, while the organisational culture synergises the strategic plan, structure, and goals of the organisation (Finnegan & Willcocks, 2007). The positive effects of strategic CRM on an organisation are realised when a customer centric orientation is employed. A component of the strategic CRM approach central to the organisational culture is a value-based set of principles known as customer centricity.

When strategic CRM aligns with a customer centric culture and effective implementation, the organisation becomes customer-focused and customer-driven over time, ultimately leading to loyalty, greater profitability, and increased returns on investment (Kumar & Reinartz, 2012). In essence, this means putting the voice of the customer to work in their favour. Aligning a customer centric culture with other strategic CRM components management controls and workplace learning could evoke the finest performance from retail product providers at every instance of retail product delivery. This can be accomplished through individualised professional and personal development focused on operational efficiency and relationship building (Sheth et al, 2000).

The development of relationships with customer segments and key customers serve to improve the shareholder value of any business. Customer relationship management may be defined as the amalgamation of information technology and marketing strategies to gain the customer lifetime value. In addition, it is imperative to state that the relationship is successful only when data is used to make sophisticated analyses. Customer relationship management is also a very good way of gaining insight into what the customer wants and gaining market intelligence (Chaturvedi & Chaturvedi, 2006). The CRM can be applied to all types of companies as their ...