Is CRM Technology Living Up To the Hype?
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Over the last few years the buzz about CRM (Customer Relationship Management) has grown extensively.It seems that every Sales & Marketing executive is talking about it. A study conducted by Jupiter Media Metrix found that U.S. businesses spent more than $5.2 billion in CRM technology software in 2001, a number that is expected to rise to $8.7 billion by 2006. CRM spending has been growing considerably, especially in financial services, retail, and telecommunications.
Many companies have invested in CRM systems to retain customers who demand more and better services by the day, but why? Due to recent trends, consumer behavior has changed dramatically in the last couple of years, and even more with current market conditions. According to a study made by The Center for Customer Strategy, consumers are less concerned with minor price differences, but choose companies based on their value-added services. They want to be able to get what they need, quickly. With tools like the Internet, it’s now a lot easier for both consumers and businesses to compare offers, and switch over if their needs aren’t met. This is especially true of high-value customers that produce the most profit for the business.
Businesses are scrambling for ways to retain these customers, and attract new ones in the process. So how is CRM an answer to keeping up with these trends? CRM is a strategy (no, not software) to transform your business to be customer, not product, focused. The CRM software is just a tool that helps the company carry out this strategy. Depending on its implementation, it can help your business identify who your customers are, what they need and anticipate what could want. It allows businesses to tailor offers to their current customers, building closer relationships that make them feel valuable. It can help eliminate contact and data overlap between departments and improve consumer service. For example, Leah Holzman, Marketing Manager of TradeCard Inc, explained how the marketing and sales departments in her company had problems tacking each others’ progress and customer data.
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