What is CRM and what are the benefits of CRM?

When you work with “computers”, quite often  your family and some friends have no idea what you do at work, computers to my parents is a mysterious and murky world of the unknown according to my parents.

Explaining what you do is also very difficult because they don’t really have any references points, it’s probably summed up by trying to explain the internet to your Granny, until both parties finally give up.

So for the past year I have been working with Microsoft CRM dynamics this has given me a bit more of a chance explaining what I am doing at work because I can explain some of the aspects of CRM and they can understand it.

I was thinking today, what is a good definition of CRM, Customer Relationship management is quite a broad area.

this is how Wikipedia describes CRM

Customer relationship management (CRM) is a widely-implemented strategy for managing a company’s interactions with customers, clients and sales prospects. It involves using technology to organize, automate, and synchronize business processes—principally sales activities, but also those for marketingcustomer service, and technical support. The overall goals are to find, attract, and win new clients, nurture and retain those the company already has, entice former clients back into the fold, and reduce the costs of marketing and client service.[1] Customer relationship management describes a company-wide business strategy including customer-interface departments as well as other departments.[2]

This article provides a great summary of the goals of CRM

  • enhanced customer satisfaction and retention, ensuring that your good reputation in the marketplace continues to grow
  • increased value from your existing customers and reduced costs associated with supporting and servicing them, increasing your overall efficiency and reducing total cost of sales
  • improved profitability by focusing on the most profitable customers and dealing with the unprofitable in more cost effective ways

So this brings me to the benefits of CRM

  • Better and more relevant information, allowing the business to make informed decisions. examples are
  • evaluating marketing campaigns to see how successful individual marketing campaigns are, marketing lists etc and ensuring you are using effective marketing.
  • Assessing Sales, getting information on what sales make the most profit allowing you to focus on those and possible exclude other areas.
  • Automation.  Increased integration between in an organisation’s different software.
  • communication.  Better communication in an organisation.
  • reduction in costs by implementing better communication, increased automation and efficiency savings
  • better customer service – through better understanding of customer needs.
  • Understanding you customers – Identifying which of your current customers are more profitable and which ones are less profitable and focusing more effort on the profitable customers.
  • linking marketing and sales – through increased understanding of your customers needs you can create better more targeting marketing campaigns which will lead to better sales
  • Cross selling – better communication increases the opportunities for cross selling within the organisation.

The wikipedia articles sums up these benefits

  • Quality and efficiency
  • Decreased costs
  • Decision support
  • Enterprise agility

I also found this article interesting

CRM Software: What is it, Do I need it, and is it worth the investment?

It is a good summary as to what is CRM and then discussing if it is worth the investment.