Customer Relationship Management
Customer Relationship Management is a description of all means of interaction between a business and a customer. Customer Relationship Management systems often handle a company’s contacts and all information regarding sales and clients (Anderson and Kerr, 2002). Customer relationship management helps a business to identify different types of customers according the benefits they bring to a firm and the companies can use the information plan other marketing strategies. Customer relationship management also helps a business to improve their techniques of selling and the management of sales and good management of sale leads to increased revenues and reduced waste (Buttle, 2004). Customer relationship management can also lead to the development of personal relationship with the customers and the close relationship leads to customer loyalty thus an increase in sales (Cunningham, 2002). This type of management also helps a company to understand a customer meaning that the company can focus on producing products that are suitable to customer due to the study of their needs.
Customer relationship management has a lot of benefits to both customers and the business. For the business, customer relationship management helps a business to keep all data relating to all customers in a single storage making it easy for the analysis of the data and the business can develop processes that are efficient (Fjermestad and Romano, 2006). For a customer relationship management program to be effective it must involve the high level management to ensure continuous follow ups and a company must educate employees on the importance of such a program to ensure that they make it a priority Customer relationship management (Payne and Frow, 2005). Stakeholders usually have very important role in this program because they are a part of the business. Internal stakeholders such as the management and employees play a direct role in the success of the program (Peelen, 2005). The company should ensure that the high level management prioritizes the program to ensure that the whole company puts all efforts to ensure the success of the program. External stakeholders also play an important role in the success of the program because they must be cooperative enough to give out their details to the company (Wellington, 2010). The company therefore needs to create trust with the customers so that they can give out their personal details.
Examples of customer loyalty schemes include a points system and partnering with another partner. A points system is where customers accumulate points according to the purchases from the company in which if the points reach a certain number, there is a reward for that particular customer (Hoffmann, 2013). Rewards may include discounts and unique treatment for the customer. Most of the businesses that use the system are the ones that store products that need frequent purchases. Examples of businesses that use the type of program include supermarkets (Wellington, 2010). In the partnering system, a business combines with another business to form a program that will ensure the growth of both companies and also ensure that they retain their customers. For example, twitter has combined with companies in the United States to reward customers who use the #hashtags to promote the companies (Hoffmann, 2013). However the companies must select an appropriate partner most preferably a company with related products for example a daily farming business may partner with a company of veterinary doctors.
The companies design such schemes to get a customer’s information thus knowing the customers better. The information the companies obtain about the customers help the companies to know the tastes and preferences of the customers and also obtain the customers’ seasonal behaviors (Hoffmann, 2013). The companies can therefore design a production system that will most appropriately suit the customers in order to avoid wastages and also increase their revenues (O'Callaghan and Keegan, 2005). Determining the behavior of the customers also helps a company identify a policy to serve the customers most appropriately through the study of the behaviors of the customers.