Academic journal article Economics, Management and Financial Markets

Customer Relationship Management: A Theoretical Approach

Academic journal article Economics, Management and Financial Markets

Customer Relationship Management: A Theoretical Approach

Article excerpt

1. Introduction

The universe of online activities, starting with e-commerce and online communication between business and customers include a variety of tools aimed to supply the needs of customers. Customers can rent, sell a product or a service, surf for information or share details with other customers, implying a wide range of tools such as priceline.com, bizrate.com or eBay. Social interaction via online can be expanded to the level of e-bill or e-pay, creating virtual community, e-governance, e-manufacturing or e-learning (Chang, Dillon and Hussain, 2006: 2).

Based on the new paradigm, transactions radically changed their structure, focusing on customer-server, peer-to-peer or mobile networks. In the case of customers or businesses using interactions on networks, in order to fulfill their objectives, their communication can be:

* Anonymous (no name is identified)

* Pseudo-anonymous (nicknames are identified)

* Non-anonymous (real names are identified) (Chang, Dillon and Hussain, 2006: 2).

Unlike the centralized customer server, enabling non-anonymous communication, in the distributed communication established by the new type of new paradigm, each server is based on its own management system. Despite the evolution of communication customer-company, trust as an essential link of this connection, is difficult to be established between the company`s agents and the company`s customers in a distributed network, since both partners function in an anonymous environment. In the absence of trust, business relationships will be reluctant, unable to create a reliable interaction between customers and the company`s agents (Chang, Dillon and Hussain, 2006: 2).

The new type of business communication raised concerns related to the global security of the network. Business security supposes the implementation of secure communication between computers, computers` agents and customers. On one hand, customers expect to receive advanced services and products. On the other hand, the companies are willing to adapt time and space, according to their purposes, as consequence online solutions including CRM will be one of the most implied (Chang, Dillon and Hussain, 2006: 2).

CRM implemented for online promotional strategies as online marketing campaigns became popular since 2010, creating a new typology named Social CRM, in order to reflect the new opportunity appearing in customer relationship management. In practice, CRM associated with online activities strengthens the relationship of companies with their customers, also reduces the costs associated with a particular business, as well as creates the opportunity of new fragmentation of audiences (Reinhold and Alt, 2012: 155). Currently CRM is supported by the increasing use of Web 2.0, allowing companies to create improves internal and external strategies, related to their employees, products or interaction with customers. CRM becomes a flow of information, facilitating the communication between companies with millions of potential customers (Seebacher, 2002: 34).

Business Intelligence solutions are extremely dynamic and flexible, as noticed in the case of CRM, evolving from a simple Sales Force Automation application to an essential concept for a company. Recently, business intelligence solutions are frequently requested to create a company`s customer centric strategy (Buehrer and Mueller, 2002: 1071). Although CRM has gained enormous popularity lately, being implied by various companies, it can`t be a universal tool for any type of business. CRM solutions that may be successful in one area, might not be suitable for other industries, as consequence the implementation of such intelligence business tool has to be double by an accurate analysis of business environment of the company willing to adopt it (Goldenberg, 2008: 11)

2. Literature Review

In terms of Business Intelligence systems, CRM can be reckoned to be an improved contemporary form of return-on-investment, as "the mandate to actively pursue, enhance, and manage the relationship with customers is seen as the mechanism for achieving the competitive edge required for greater profitability" (Report The CRM Phenomenon, 2000:2). …

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