Question

Customer Relation Management (CRM) is an essential part of any successful Information System. Discuss what CRM is, what it’s used for, its technical structure and processes, its advantages to the enterprise, and to the clients and consumers. Give example from your personal experience.

Answer 1

CRM can be defined as the practices, means and guiding principles employed by an organisation to interact with its customers. It encompasses entire gamut of sales related interactions, purchase process, post purchase interaction and managing to get repeat purchases and ultimately, generation of a positive word of mouth. The objective of CRM is to search, contact, prompt to puchase, handhold and create loyalty in the mind of customer during its life cycle.

CRM is more and more becoming technology oriented. The technical structure of CRM includes the technology enabled system used to collect and maintain data of customers, their purchase patterns, their demographics, contacts and other vital information about them which can be used appropriately to interact with them at most suitable time and place to make the interaction most productive and efficient.

With CRM, an enterprise knows vital insights about their customers and uses them in most effective manner to maintain a long standing and fruitful relationship with the existing cusstomers while attracting more new customers to contribute to its bottom line. With CRM it also hopes to create brand advocates from its most loyal customers and generate word of mouth publicity both online and offline. The consumers get the benefit of extra benefits for association with the company in form of discounts, privileges, loyalty bonuses, free upgrades, freebies and exclusive access to promotional events etc.