Data management for Customer Relationship Management (CRM) involves the organized collection, storage, and utilization of customer-related information. It ensures accurate and timely access to customer details, enabling businesses to make informed decisions, personalize interactions, and optimize customer experiences.
Managing customer interactions
Managing customers and their interactions with the business is an important aspect of CRM, and effective data management is a key CRM enabler.
Customers interact with the business via telephone, direct mail, website, or any other channel, and these interactions impact the customer’s experience. These interactions are used by customers to measure the business and determine the level and type of relationship.
Business-customer relationship success is determined by the quality of the interactions. Companies can create loyalty, differentiate itself from its competitors, and increase the value of the relationship. If managed improperly, the experience can undermine the success of that relationship.
CRM and Data Management
The digital age has created an informed customer seeking for who expects more from their interaction with businesses. These expectations are usually not met because businesses lack up-to-date information about the customers.
CRM strives to manage customer interaction effectively from an enterprise point of view. The goal of customer data integration (CDI) is meeting customer expectations. It is achieved when relevant customer information flows freely throughout an organization to the point of the interaction.
Customer Data Integration – Definition and Requirements
CDI is a data management process where customer data can be distributed to points of interaction in a timely and accurate manner. CDI enables the organisation to integrate customer, manage and distribute it in real-time throughout the organization.It is important for any business to properly understood the concept of CDI when considering the overall CRM objective.
- Distribute: The distribution of customer data from its source to all points of interaction must be standardized and managed through a single corporate point of reference.
- Points of interaction: All points of customer and business user interaction that determine the nature of the relationship must have access to relevant customer data.
- Timely: All customer data needed for decision-making must be delivered in a time frame appropriate to the needs of each point of interaction.
- Accurate: Customer data delivered must consistently and accurately represent a given consumer entity, including individuals, households, or businesses.
CDI is based on three components:
- Enabling technology components, which control data management and distribution. This technology is designed to operate within the framework of existing data warehousing and database marketing systems, providing the means to access and distribute relevant data from each system.
- The introduction of a reference database to provide customer links through a referential matching process. The reference database is impartial, providing links between all captured instances of a customer.
- The corporate-wide adoption of both the technology and the reference database. The firm can create a customer knowledge base when they meticulously collect data from multiple customer interactions and its value chain members.
Steps in Customer Data Integration
Identify Touch Points: The organization should identify all areas in which it is possible to interact with current and prospective customers. Every interaction generates a transaction or some type of relative information.
Define How Data will be Collected: A method of collecting information from interaction at a specific touchpoint must be defined.
Establish Business Rules for Data Collection: Each touch point will precipitate the capture of one or more data variables. In many instances, the same information may be captured from more than one touch point.
Create a Methodology for Managing the Data Input Process after Collection: This process should be coordinated to meet the timing requirements of other processes, ensure security, and be consistent and accurate.
Place the Data into a Common Format: Customer or prospect personal identification information may be captured by the organization or its value chain members in a variety of formats from different touch points. This information may be collected as a result of an inquiry, a transaction, or another type of communication (e.g., a follow-up to an order, a complaint, a suggestion, or a reimbursement).
Separate Customer Linkage Data from All other Data: Data collected from touch points can be placed in two categories.
1) The “nonlinkage information,” which is any element that is not used to identify contact information. Product(s) purchased, price paid, or date of purchase would be examples of nonlinkage information.
2) “Linkage information”, the type of information that can be used to identify a person, business, or household. A household can be defined as those individuals who make up a consumer family (including nontraditional or extended) who live at the same location.
Standardize Customer Linkage Data: The linkage data elements captured from multiple touch points may differ in their format.
Correct the Linkage Data Components: Correcting any errors in the linkage components will enhance all subsequent steps.
Apply Postal to the Customer Linkage Data – Products and services provided by the postal services enable the effective use of CRM systems.
Perform the Customer Linkage Identification Process: merge/purge records of individuals or businesses that appear more than once in any set of data.
Enhance the Customer Data with Other Sourced Data: Adding the purchased data to existing customers or prospects.
Perform a Suppression Process on The Data: There are reasons for not establishing a relationship with a customer or prospect that depend on the nature of the business. Eg for the suppression of a person in the organization’s customer records is that he or she is deceased, a minor, in prison, in the military, in an area unable to serve the product or service, on the “Do Not Call” or “Do Not Mail” files.
Consolidate Customer Linkage and Related Customer Data: All relevant customer information is tied to the linkage component precipitating a single consolidated view of the customer. This is the main CDI objective.
BATheories.com is managed by a group of educators from Mumbai. We also manage the website StudyMumbai.com. Our panel includes experienced professionals and lecturers with a background in management. BATheories is where we talk about the various business theories and models for BA (Business Administration) students.
