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The Importance of Customer Relationship Management

Customer relationship management or CRM is a marketing discipline specializing in the development of consumer relationships. CRM can involve electronic and automated methods of regular communication with target markets. Data mining is a component of CRM, but cannot occur if the company does not have a method of collecting information about the purchasing habits of its current clientele. A variety of software applications and embedded website tools can collect information from potential and current customers, provided they are willing to offer their personal information. internet marketing firm firms help organizations automate the data collection and communication processes that drive incremental sales.



A prime example of CRM is supermarket club savings cards. Consumers willingly agree to tie their personal information (e.g. name, address, e-mail address, and phone number) with their purchasing habits. In exchange, the supermarket offers the consumers regular savings on items within the store, plus personalized steep discounts and free items based on frequent purchases. The information is captured and managed electronically, as it is integrated with the company's point of sale systems, UPC bar codes, and personalized websites. Consumers can log in and add personalized items to their club cards, see the weekly sales ads at the store of their choice, and download smartphone aps that allow them to add offers while shopping in the stores. Websites such as My Sales Butler and Salesforce.com provide additional insight on how CRM integrates technology and sales.



With customer relationship management, consumers develop loyalty to the organization or its brand due to rewards. Essentially the consumer develops an affinity to the brand or the organization because they have the perception they are receiving something extra for their patronage. The rewards are an incentive for the customer to keep purchasing products and services from the organization. A give and take relationship begins to develop, especially since the rewards are personalized according to the unique needs of individual customers. CRM services, such as my sales butler, are able to recognize patterns and intelligently make purchasing suggestions to individual consumers based on past behavior. In this sense, consumers experience the illusion that the organization knows them personally. Even though the suggestions are based on information and analytics, a qualitative aspect develops.



Customer relationship management involves the integration of technology and automated data collection to determine what consumers are interested in. Organizations use CRM applications to capitalize on the knowledge that the data reveals about individual consumer preferences and habits. By offering consumers incentives to purchase what they are already likely to purchase, consumers develop an affinity and loyalty towards the organization. CRM can increase sales if done properly, but it can also be used to share information with consumers about the organization's mission and topics of interest.