Manage your customer database

Database marketing and customer relationship management

The better a business can manage the relationships it has with its customers, the more successful it will become. Developing a customer relationship management (CRM) system helps you understand what and how your customers buy from you.

The benefits of this are:

• increased sales to new and existing customers through better timing, identifying needs more effectively and cross-selling of other products
• effective marketing communications, through a more personal approach and the development of new and improved products or services
• enhanced customer satisfaction and retention
• increased value from your existing customers - and reduced cost to serve

You can find information on cost to serve on the FAFH Consulting website - Opens in a new window.

With an effective marketing database as part of your CRM system, you will be able to analyse the data to find out who your most profitable customers are and what characteristics they share. This will assist in giving you a clear idea of what sort of person or organisation to focus your marketing activities on. It may, for example, be possible to group customers according to geographic area or to target your own promotional and sales efforts more precisely.

You will also be able to communicate better with your customers by identifying similar groups of customers to target by a particular method, such as telephone, direct mail, email or face to face. You might, for example, want to reward regular, profitable customers with targeted special offers, or you might want to target customers that you haven't done business with in the past year. CRM can also help you measure the effectiveness of your marketing activities so that you don't waste time and money on customers who aren't responding to your promotional campaigns.

You can read about CRM in our guide to customer relationship management.

Subjects covered in this guide

• Introduction
• Database marketing and customer relationship management
• Set up a customer relationship management system
• Compiling your customer data
• Developing your customer database
• Keeping your customer database accurate
• How to choose a customer database supplier

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