3.10 Customer relationship management (CRM)
CRM is a marketing philosophy based on making the customer the highest priority. It consists of the collection and analysis of information designed for sales and marketing to understand and support existing and potential customer needs. This analysis includes account management, catalog and order entry, payment processing, and customer credits and adjustments.
Delivery and design. An effective design process links delivery and service with customer needs. The design process ensures that the customer's needs are met in a simple and cost-effective manner. The delivery process is not one size fits all; it must be designed and customized to meet customer needs and expectations while keeping the number of revisions low.
Contract and customer management. A successful CRM system includes a robust contract management protocol to ensure that contracts are sufficient to meet the needs of the company, with effective and efficient customer support always in mind. Although a company's primary purpose is to turn a profit, the company will not remain profitable in the long run without effective customer support that produces loyal customers.
Contract management. Contract management and administration are crucial to holding suppliers and customers accountable for meeting the work specified in a contract. Contract management includes developing specific statements of work or product specifications, finding sources of supply or service, negotiating with suppliers and vendors, evaluating contract performance against agreed-upon metrics, and evaluating product quality. Other functions of contract management include the evaluation of contract responsiveness, negotiating changes to a contract, and ensuring that the contractor is compensated for the products or services provided.
Customer management. Companies can affect the buying, purchasing, and contracting activities of the customer. The goal of customer management is to develop and maintain loyal customers, which usually is accomplished through customer loyalty programs that reward customers for repeat business. The company benefits by gathering information on customer buying habits and preferences, which the company uses to create targeted product offerings and promotions. Keeping customers satisfied and loyal is critical to company profitability and is one of the founding principles of customer management.
Companies use performance metrics taken from the customer's perspective, with criteria such as on-time delivery, perception of quality, percentage of complaints, and shortened customer wait times. These metrics are important in measuring customer satisfaction and developing loyal customers.