Customers are the most important people in a business as the basic objective of any
business is to sell its products to customers and satisfy them so that they should purchase the products again. Customer Relationship Management helps organizations to understand different needs of different customers in a better way and come up with strategies that could not only attract new customers but also help in making existing customers more satisfied. And only if a company can make their strategy that focuses on satisfying customers then only then can perform better than the competing firms.
The term CRM is used to define the techniques, methods and tools used by any organization to manage the relationships with its customers. CRM shapes the foundation by which an enterprise understands the needs, demands and wants of the customers and are in a better position to analyze the future changes that could come up in the next few years. This also helps a company in understanding its customers better so it would act as a competitive advantage since company would know more about its customers, what are their needs, and other important information regarding the customers. So with this, businesses are able to know customers more and therefore will be able to retain more customers thus reducing different kinds of operational costs and helping the company in stabilizing revenues. Another important reason for retaining a customer is that the cost of acquiring a new customer is much more than retaining a customer.
Being customer centered is the key element for all size of organizations to survive in the competitive environment at risk. Withholding of clientele is especially significant for Small Medium Enterprises (SMEs) due to the reason that they have restricted resources available to them. One more phase of customer relationship management is that understanding of customer and their character permits for the convenient attainment of new clientele.