Customer Relationship Management Programs and Their Impact on the Financial Performance of Businesses: A Proposed Model
Massey University Commerce Working Paper No. 03.05
18 Pages Posted: 6 Apr 2004
Date Written: May 2003
Over the past decades, it has been argued that businesses across all sectors should move toward interactions, relationships, and networks. Such a marketing approach is very different from the more traditional one of marketing through the 4Ps (i.e., product, price, place, and promotion). The customer relationship market is among many different markets a firm needs to consider with research suggesting that customer retention leads to increased market share and bigger profits. Although some practical guidelines have appeared on how to design and implement customer relationship management programs, there are few articles discussing the financial impact of such programs on companies. This paper addresses the problem by discussing a conceptual framework that allows for a financial evaluation of programs in areas that are relevant to customer relationship management.
Keywords: Customer Relationship Management (CRM), financial performance, CRM measurement scale development
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