Customer Relationship Management

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Customer relationship management focuses on using information about customers to create strategies that develop and sustain desirable long-term customer relationships. This focus is possible because today's technology helps companies target customers more precisely and accurately than ever before. CRM technology allows businesses to identify specific customers, establish interactive dialogs with them to learn about their needs, and combine this information with their purchase histories to customize product to meet those needs.

Advances in technology and data collection techniques now permits firms to profile customers in real time. The goal is to assess the worth of individual customers and thus estimate their lifetime value to the firm. Some customers, those that require considerable coddling or who return products frequently, may simply be too expensive to retain given the low level of profits they generate. Companies can discourage these unprofitable customers by requiring them to pay higher fees for additional services.

CRM focuses on building satisfying relationships with customers by gatherings useful data at all customer contact points. These include telephone, fax, online, and personal contact. These are analyzed so that data is better understood to meet the customer's needs and desires. Companies are increasingly automating and managing customer relationships through technology. Indeed, one fast growing area of CRM is customer support and call center software, which helps companies capture information about all interactions with customers and provides a profile of the most important aspects of the customer experience on the web and the phone. Customer support and call center software can focus on those aspects of customer interaction that are most relevant to performance, such as how long customers have to wait on the phone to ask a question of a service representative or how long they must wait to receive a response from an online request. This technology can also help marketers determine whether call center personnel are missing opportunities to promote additional product or to provide better service. Sales automation software can link a firm's sales force to applications that facilitate selling and providing services to customers. Often these applications enable customers to assist themselves instead of using traditional sales and service organizations.

With the extraordinary growth of information technology, the internet, and e-business has generated it is any wonder that legal and social issue for consumers and businesses have arisen. These issues include privacy concerns, identity theft, and protection of intellectual property and copyrights. Businesses have long racked consumer's shopping habits