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The business benefits of Customer Relationship Management (CRM) have been fairly well documented. One Harvard paper calls CRM not merely a system, but a philosophy that can yield wide benefits to businesses, regardless of their domain of expertise.

CRM is a business strategy that originated in the 1980s with an aim to combine technology and marketing. CRM depends on harvesting customer data and using technology to draw conjectures from said data. Up till the early 2000s, a customer relationship management system was dominated by a few major players (such as Oracle) that priced their software far beyond the reach of SMEs. After the dot-com bust and the subsequent "internet renaissance", a number of companies sprang up offering powerful, affordable CRM software, thereby making customer relationship management feasible for small businesses.

Among the many benefits of CRM software are:

1. Increased sales. CRM software basically tracks your customer purchases and helps you make conclusions based on their prior purchasing history. It can increase sales by anticipating current needs of the customer based on prior history, so that you can make offers accordingly. Think of a customer relationship management system as the central 'brain' of your marketing department which can pinpoint when and what a customer needs or wants to buy.

2. Identify customer needs. A CRM system tracks your customer purchases and gives you a snapshot of their spending habits, wants and needs. You can track specific customers and make intelligent decisions on what they might be interested in by digging through what they bought in the past. It helps you know your customers better so you can make better offers, and mold your product accordingly.

3. Better products. You can alter your product only when you know your customers. A CRM system can give you a detailed snapshot of your customers' consumption habits, through which you can change your products to better fit their needs. A better customer makes for a better product.

4. More customized solutions. Customization is the new buzzword in the industry, thanks to the powers of CRM software. When you know your customer and his requirements, you can tailor solutions tailored specifically to his needs.

5. Improved profitability. With a CRM system, you can identify which of your customers give you the highest profits, thus helping you determine the ideal customer to pursue for improved profitability. 3.65 4 0.00 3 0.00 3