Definition
Customer Relationship Management, or CRM for short, defines the existing and potential customer relationships of a company. This includes the documentation and management of all important components of a customer relationship.
One of the central objectives of Customer Relationship Management is the increase of customer loyalty. The more loyal a company’s customers, the more likely they are to buy from that company again or recommend it to others.
A distinction is made between quantity-related, price-related, resource-related and time-related aspects of customer loyalty:
- Quantity-related aspects: Customers purchase additional products or services from a company.
- Price-related aspects: The customer is willing to pay a higher price for a company’s products or services than for equivalent competitors.
- Resource-related aspects: The customer makes additional investments to develop the relationship with a company, e.g. through shared IT or logistics.
- Time-related aspects: The customer commits to a company for a longer period of time, e.g. through a framework agreement.
The German equivalent of CRM is Kundenbeziehungsmanagement. However, in connection with the term CRM, it often refers not to the totality of customer relationships, but only to the technical prerequisites for their maintenance. This involves building a database to systematically record and manage customer contacts.
Tasks of a CRM Software
With the help of a CRM system, all data relating to a customer can be recorded and processed. It also supports communication, records figures, data and facts and is an important component in marketing.
Thanks to the easy evaluation of data, customer behaviour can be analysed more quickly and responses can be made to changing needs or new competitors.
Goals of a CRM Software
- Maintain and improve customer relationships
- Better analyse existing markets
- Open up new markets
- Increase economic efficiency