3 Definitions of What CRM Really Means

While companies the world over are beginning to understand the importance of customer relationship management, it still seems that many of these companies are defining the idea of CRM differently, resulting in very disparate methods of collecting, analyzing, and using information. According to Dr. Vince Kellen , a professor at DePaul University, the market has decided on three types of CRM definitions: Technology Centric Customer Lifecycle Centric Strategy Centric

Those that follow the technology centric definition of CRM believe that CRM is somewhat limited and synonymous with the technology used to automate it. In other words, CRM isn’t itself a strategy for a company. Rather it’s the products and technologies used to manage the customer experience. Companies that subscribe to this definition are unlikely to put many actual research strategies in place.

When a company believes in the customer lifestyle definition of CRM, the business is likely to focus its attention on how to attract and enhance the customer’s viewpoint on a product that already exists. The idea is that the product itself won’t change, nor will the services. Instead, Customer lifestyle centric CRM businesses will focus on how best to market the product to customers already, and get them to continue to be loyal customers.

Strategy centric CRM models use CRM as a way to approach the entirety of their own business. Their CRM models would look for how best to move their business into the market, and how to continue to compete – even if it involves changing their company’s philosophy, products, etc. Strategy centric in many ways is the opposite of customer lifestyle centric, and while they may use technology for their purposes, they don’t define CRM by the technology. It’s merely a means to an end.

CRM is a vital aspect of your marketing strategy, but how you define it plays a large role in how successful it will be for you. Dr. Kellen believes that strategy centric is the better definition for a variety of reasons that will be explained in a later article, but he adds that the main flaws with technology and customer lifestyle centric models is that neither are about creating a competitive long term advantage.

Instead, they seem to focus on trying to make what already exists within a company look better to the consumer. Related Blog Part 2