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Customer Relationship Management: Analytical Essay

Introduction

Customer relationship management (CRM) is to create a competitive advantage by being the best at understanding, communicating, delivering, and developing existing customer relationships, in addition to creating and keeping new customers. It has emerged as one of the largest management buzzword. Popularized by the business press and marketed by the aggressive CRM vendors as a panacea for all the ills facing the firms and managers, it means different things to different things to different people. CRM, for some, means one to one marketing while for others a call center. Some call database marketing as CRM. There are many others who refer to technology solutions as CRM.

CRM is a strategy for managing a company’s interactions with customers and sales prospect. CRM also to establish, develop, maintain and optimize a long-term mutually valuable relationship between consumer and organizations. It also to develop new customers, nurture and retain them simultaneously reduce the costs of marketing and customer service.

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Content

10 benefits of adding product customization to your business

  1. Additional mentioning by the mass media. By introducing even the smallest DIY opinions for their current product portfolio, companies would automatically give the local or international mass media agencies the incentive to write about that feature in one of the latter's upcoming publications. That new option does not have to be big in order to be a hit. Businesses would just need to make sure it’s fun, relevant, and useful.
  2. An opportunity to place higher prices on their products. Customized and well-made products are often considered to be special. In turn, special goods are often considered to be scarce and exclusive. And as it is often shown by recent research, customers are willing to pay an extra 25% of the original price for an opportunity to have those exclusive products. Therefore, by introducing product customization, different businesses may enjoy higher percentage of revenues from selling even a slightly upgraded version of their original product.
  3. Information about the things your customers want to purchase. An additional advantage of selling personalized product is an opportunity to have timely and relevant information of your customers’ tastes and needs at absolutely no cost. Therefore, by introducing product customization, all the customers will receive accurate information about the products their customers actually buy and hence have a clear understanding of the business direction they should go to in the future.
  4. Presence in the gift market. When it comes to celebrating Birthdays, Christmas, New Year or any other event, we all want to present our friends and relatives with a special gift which would make them happy. Just an ordinary object would not always do the trick. But a personalized one with a special name or a signature can well be an option here. After all, it would be hard to resist a temptation of owning customized watches or kits with your own name being placed on it. Therefore, by giving its customers an opportunity to create and buy some personalized products, a company would have a chance to enter itself into the gift market and hence have an opportunity to earn additional profits out of it.
  5. Better customer loyalty with a lower product return rate. By letting a customer take part in the product creation process, a business will make sure that the customers get exactly the kind of product they wanted to buy which will lead to a feeling of involvement and satisfaction. The latter has been proven to have a positive impact on the number of repeat purchases, customer loyalty, and product returns.
  6. Better search ranking within the search engine results. Creating your personalized product is an interesting task. While trying to build their very own products, customers would spend considerably more time on the company’s website trying out different features and characteristics their new purchased product should have. Therefore, as a result of introducing product customization, company’s websites may well enjoy an improvement in the important SEO metrics such as Time or Site and Bounce Rate. This in turn would lead to advancement in their rankings within the search engines hence leading to a higher amount of leads and larger revenue.
  7. A product customization a try is an opportunity to sell their products in a direct way without the involvement of other channel members. In this way, a business will collect larger revenues and avoid any unnecessary conflicts with its retailers.
  8. Simplified Order Process with regards to timing and costs. If you can remember the process of buying customized products from the good old 90s when computers had a size of a modern mid-sized fridge, you are surely aware of all the hurdles this process was associated with. Misunderstood requirements, long waits for your specifications to be sent back and forth before you finally see the thing you wanted to buy. All of this was time-consuming, costly, and frustrating for both you and the company you wanted to purchase something from. But now, by introducing a product configuration option on their website, companies will save a lot of time by rationalizing this process. In other words, product customization will illuminate the waiting time and make sure that the customer gets exactly what he or she wanted quickly and easily.
  9. Have a Free Market Research. Product customization is one of the best tools to understand what your customers want. Flynn talks about Disney and how customization made the entertainment group realize that they should launch a whole new merchandising line, which brought in huge revenues. You don’t need to be a Disney for this to work for you too. Just pay attention to what your customers are creating and this will tell you a story.
  10. Generate more sales. Personalizing products doesn’t just help increase sales, it also keeps your customers satisfied, which promotes loyalty and word-of-mouth recommendations. A study by Deloitte suggests that, on average, in different retail sectors, 36% of consumers would consider buying customized products or services. If that figure surprises you, just listen to this: 1 in 5 of these consumers would be willing to pay 20% more for a personalized or exclusive product! This indicates a shift in consumer mentality away from monetary cost, and towards inherent value. In addition, 48% of customers would be willing to wait longer for a customized product or service. This means that while their personalized product is being created, customers have more time to browse and possibly even generate more sales.

Conclusion

Customization is a great way to learn about your customers, by offering customization on product features you can better refine what you offer to your various customer personas. Indeed customization enables the creation of new persona’s you probably had not even considered.

Luxury and custom go hand in hand, therefore in order to build a brand in an increasingly competitive global market, in many cases you need unique and custom to survive.

The byproduct of offering customization is overwhelmingly positive if done progressively. The saying “don’t bite off more than you can chew” certainly applies here. Implement customization where it costs the least to supply first.

Reference

  1. Chapter 1: Introduction to Customer Relationship Managements
  2. Defining of CRM (page 1)
  3. http://blog.doogma.com/product-customization-for-your-business
  4. https://www.rolandg.co.uk /benefits-of-product-customization
  5. https://www.optimonk.com/product-customization-benefits/

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