What CRM is
Customer Relationship Management. A business discipline designed to identify, attract, and retain a company's most valuable customers. It describes improved and increased communication between a company and its customers. First espoused in the 1960's by management gurus Peter Drucker and Theodore Levitt, CRM is intended to provide a unified, company-wide view of the customer and to cultivate high-quality relationships that increase loyalty and profits. Basically, the idea is not to let an interaction with a customer escape a firm's centralized database. The focus is on learning more about customers and using that knowledge to refine every interaction with them. Effective CRM requires an integrated sales, marketing, and service strategy, supported by CRM software that provides profiles and histories of each interaction the company has with each customer. When managers cull this data, it helps them evaluate their progress. A comprehensive CRM strategy can anticipate needs; tailor messages, products, and services; create value; anticipate problems; and improve the customer's overall experience in dealing with the company. Welcome to 21st century business.
The meaning of E-commerce
Put simply, it means conducting business online. Selling goods, in the traditional sense, is possible to do electronically because of certain software programs that run the main functions of an e-commerce Web site, including product display, online ordering, and inventory management. The software resides on a commerce server and works in conjunction with online payment systems to process payments. Since these servers and data lines make up the backbone of the Internet, in a broad sense, e-commerce means doing business over interconnected networks.
The definition of e-commerce includes business activities that are business-to-business (B2B), business-to-consumer (B2C), extended enterprise computing (also known as "newly emerging value chains"), d-commerce, and m-commerce. E-commerce is a major factor in the U.S. economy because it assists companies with many levels of current business transactions, as well as creating new online business opportunities that are global in nature.
A few examples of e-commerce:
- accepting credit cards for commercial online sales
- generating online advertising revenue
- trading stock in an online brokerage account
- driving information through a company via its intranet
- driving manufacturing and distribution through a value chain with partners on an extranet
- selling to consumers on a pay-per-download basis, through a Web site
In the public sector, e-commerce is a hot topic and a complex issue, especially concerning privacy rights and fraud. In private business, B2B e-commerce is projected by Internet analysts to be the biggest sector on the Web. Even though the Nasdaq crash of April 14, 2000, had a negative impact on much of the industry, e-commerce, because of its nature and the robustness of the Net, is here to stay.
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