CRM (Customer Relationship Management) is an integrated approach to identifying, acquiring, retaining and delighting customers. The purpose of this thesis is to analyze the impact of Customer Relationship Management Process on Customer Retention with reference to Banking Sector. We describe the objectives of Customer Relationship Management (CRM) in Customer Retention which is very important for the survival of companies in today’s competitive environment.
CRM helps organizations maximize the value of every customer interaction and drive superior corporate performance. The challenge is to make it easy for customers to do business with the organization any way they want at any time, through any channel, in any language or currency and from any country and to make customers feel that they are dealing with a single, unified organization that recognizes them at every touch point. In fact, the generally accepted purpose of CRM is to enable organization to better manage their customers through the introduction of reliable systems, processes and procedures for interacting with those customers for organizations. Therefore enough knowledge of environment, expectations of customers and their desires are very important to find the best solution for facing un-expected behaviors of customers and then behave in such a way to change the mind of customers in the direction of companies’ profit.
Marketing is one of the core disciplines of successful management today. It impacts on society everyday in a myriad of ways – creating new products and services; helping organizations understand what people want and need; helping people find products and services that meet their needs; communicating information that makes people’s lives more efficient; creating exchanges that generate employment and wealth. But marketing also raises ethical issues about excess consumption, unhealthy obsessions and addictions, the impact we have on the environment and the communities in which we live.
Obviously marketing is important in all areas of the organization, and customers are the reason why business exists. In fact, marketing efforts (including services as promotion and distribution) often account for more than half of the price of product. Based on the nature of marketing, it involves voluntary “exchange“relationship where both sides must be willing parties. The parties must be able to communicate which could be through different instrument. Therefore, in today’s highly competitive environment, business needs to better understand their customers, which who are the most profitable, and how to best retain those customers. This understanding meets through different channels which one is CRM.
“CRM is short for Customer Relationship Management, the industry term for the set of methodologies and tools that help an enterprise manage customer relationships in an organized way.” (Strategic Management website- 2005) CRM helps companies make sense of customer needs and helps companies manage these relationships more intelligently and help predict the future. Such knowledge provides a crucial competitive differentiation for companies to gain market share and reduce operational costs with retaining their customers.
On the other hand the generally accepted purpose of CRM is to enable organization to better serve its customer through the introduction of reliable processes and for interaction with those customers.
It is a process or methodology used to learn more about customers' needs and behaviors in order to develop stronger relationships with them. There are many technological components to CRM, but thinking about CRM in primarily technological terms is a mistake. The more useful way to think about CRM is as a process that will help bring together lots of pieces of information about customers, sales, marketing effectiveness, responsiveness and market trends
Retention and Acquisition