Customer Databases

Database marketing and CRM – the benefits

Understanding what and how your customers buy from you is essential to the success of your business.

The benefits of this are:

  • increased sales to new and existing customers through better timing, identifying needs more effectively and cross-selling of other products
  • effective marketing communications, through a more personal approach and the development of new/improved products/services
  • enhanced customer satisfaction and hence customer retention
  • increased value from your existing customers – and reduced cost-to-serve

An effective marketing database and Customer Relationship Management (CRM) system will enable you to analyse the data, to find out who your most profitable customers are and what characteristics they share. You will then have a clear idea what sort of person or organisation to focus your marketing on. It may, for example, be possible to group customers according to geographic area or your own promotional and sales efforts.

An effective marketing database and CRM system will also help you to communicate successfully with your customers by identifying similar groups of customers to target by a particular method, such as telephone, direct mail, email or face-to-face. You might, for example, want to reward regular, profitable customers with targeted special offers, or you might want to target customers from whom you haven’t had business in the past year. It can also measure the effectiveness of your marketing so that you don’t waste time and money on customers who aren’t responding to your promotional campaigns.

CRM is a sales and marketing issue, not a matter of IT. It is about developing a strategy and a set of tools for improving your customer knowledge, which is supported – not led – by the technology.

See also our guide on the Benefits of CRM

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