What is Customer Relationship Management?

Customer Relationship Management (CRM) is the term given to the process of developing and maintaining personal relationships with your customers. It is often achieved through the use of technology – for example, providing a free or low-charge telephone number specifically for customers to contact you – but to be truly effective the technology needs to be integrated with a business solution.

When you first started your business you probably knew all your customers on a personal basis. You knew what they ordered, how much and how often and you may have been in regular contact. As your business grows this becomes more difficult, and a CRM solution can help you to recapture this situation through the use of databases, the Internet, telemarketing and direct mail.

If appropriate, a CRM solution can be set up to help you analyse which customers are most profitable in order to communicate with them more cost-effectively. If you have a large customer base, you can probably afford to communicate:

  • regularly and personally with the top 20%
  • through telemarketing and occasional personal contact with the next 40%
  • through occasional mailings with those remaining.

For further information on marketing see the free factsheets available through the learndirect website. Royal Mail also has tips for keeping close to your customers.

‘Customers’ business advice article: Crown Copyright © 2002-2013

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