Customer Relationship Management

Customer Relationship Management, or CRM, is an industry term for software solutions involved in the entire process of pre-sales, sales and service relationship with a customer. Many software applications are now available that permit you to record this relationship from the time the clients asks their first question. Good CRM software is much more efficient than fragmented records as it can save time in tracking communications and transactions with a particular person.

CRM Software

CRM software is defined as business management and automation of the front-office divisions of an organization. CRM software is essentially meant to address the needs of Marketing, Sales & Distribution and Customer Service and Support divisions within an organization and allow the three to share data on prospects, customers, partners, competitors and employees. The purpose of CRM software is to manage the customer through the entire lifecycle, i.e. from prospect to qualified opportunity to order.

CRM software automates many of the needs of Marketing, Sales and Support users, such as Telephony, or the ability to conduct phone calls and manage call data, and tools to capture, share and manage automated alerts on lead data as it passes through the sales pipeline. CRM software provides a standard framework for pushing leads through a sales pipeline and managing it amongst many stakeholders in real time, in order to provide better customer relations and grow revenues by creating more sales, and losing fewer customers.

CRM software helps organizations achieve their customer relations goals by measuring key performance indicators collected by the CRM software about customer lifecycle behavior. Benefits include isolating those marketing campaigns that drove the most and best quality leads, improving internal efficiency, complete customer histories and the ability to provide appropriate support and consequently retain customers

Operational CRM

Operational CRM provides support to "front office" business processes, including sales, marketing and services. Each interaction with a customer may be added to their contact history, allowing employees to retrieve customer information from the database as necessary.

Collaborative CRM

Collaborative CRM covers the direct interaction with customers. This can include a variety of channels, such as internet, email, automated phone/ interactive voice response (IVR). It can generally be equated with "self service".

The objectives of Collaborative CRM can be broad, including cost reduction and service improvements. Many organizations are searching for new ways to achieve and retain a competitive advantage via customer intimacy. Collaborative CRM gives a 360 degree feedback of the customer and allows industries and trades to pool their respective customer data in the different sales and communication, thus gaining better customer insight.

Collaborative CRM also includes PRM (Partner Relationship Management) which enables companies to reach out to End Users with the help of Partners (Resellers and Distributors.

Analytical CRM

Analytical CRM uses predictive analytics to manage customers and their information in several ways:

• design and execution of targeted marketing campaigns to optimize marketing effectiveness
• design and execution of specific customer campaigns, including customer acquisition, cross-selling, up-selling, retention
• analysis of customer behavior to aid product and service decision making (eg pricing, new product development, etc)
• management decisions, e.g. financial forecasting and customer profitability analysis
• risk assessment and fraud detection, in particular for credit card transactions

Reference: Wikipedia
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