Research Paper on Customer Relationship Management

Paper Type:  Research paper
Pages:  7
Wordcount:  1695 Words
Date:  2022-11-05


In the present world that is highly competitive, an expanding number of organizations have realized the importance of turning out to be more customer oriented and have thus contributed vast amounts of time and assets in CRM framework with the intention of dealing with clients better (Lykegaard, 2011). To have the ability to comprehend behavioral changes in the customer lifecycle framework, managers and people in business need to understand specific customer lifecycles associated with CRM. Other than understanding life cycles, managers also need to understand the history of these lifecycles, the development and how they are defined presently. According to Egan (2008), customer lifecycle is a 'suggestion of a more created relationship that will bring a more gainful customer and keep the customer in mind in the end goal of production.' To put it, customer lifecycle is the behavior of a customer with a business over time.

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At every point before purchase, the customer begins a relationship with the seller over time and will decide to either continue with the link or end it. At any point in the lifecycle, the consumer either has more or fewer chances of advancing to engage in business with the company through his interactions. Collecting data from such interactions (page views, purchases for commerce, logins, and contacts for service) a business can use the information to predict where the consumer is in the lifecycle. If a businessperson manages to predict where customers are in the lifecycle, he can maximize his marketing using ROI by targeting consumers who are most likely to buy as well as save existing consumers from losing interest and at the same time keep on money that would be wasted on consumers unlikely to buy. This paper discusses specific customer lifecycles associated with customer relationship management and looks at the history, development and present understanding of these lifecycles.

Literature Review

In the present business environment, every businessperson strives to make the consumer the center of every operation. As a result, business people have realized that placing the consumer at the heart of the business is the way to success especially by managing relationships with clients. In observation by Sheth & Parvatiyae (1995b), developing a healthy relationship and life cycle with consumers has historical antecedents that date back to the pre-industrial era. Consumer relationship management and loyalty began because of the interaction between agricultural producers and consumers. It was this direct interaction that developed into relational bonding between the producer and the consumer and later gave rise to mass production. Currently, the relationship between consumers and producers is termed as a de-intermediation process where industries use sophisticated telecommunication and computer technologies to allow direct interaction between consumers and producers.

The process of de-intermediation has in the present emphasizing the integration of supplies, parts and the sale of services along with individual capital equipment. Similarly, companies also started insisting on new purchasing approaches such as contracts, master purchasing agreements, and compelling new vendors to adopt key account management strategies. 'CRM is a business strategy that is designed to deliver profitability, revenue, and satisfaction' (Gartner Group, 2002). With this strategy, the organization manages to turn their attention to the consumer. Rai and Singh (2008) on the other hand view CRM as a business philosophy which shows how the organization truly believes in customers or not. Different from authors who see CRM as a philosophy and a business strategy, Rababah, Mohd & Ibrahim (2011) choose to look at CRM from a definition from the aspect of business culture. According to them, CRM is the building block of customer-orientation and also a technique created to acquire, enhance profitability and retain of clients.

As a culture that seeks to interact with clients, CRM according to these authors forms part of an IT application that brings mutual benefits for both the organization and the clients, in as much as authors approach CRM from different perspectives, they all agree that it is consumer-oriented and helps identify and acquire new consumers for long-term relationships. With this agreement, it is evident that the main objectives of CRM are loyalty and customer satisfaction as pointed out by (King & Burgess, 2008). Customer lifecycle is a component of CRM and it is understood from the three core processes of consumer acquisition, consumer development, and consumer retention. All these processes combined to give rise to one factor of the customer lifecycle. According to Moon et al., (2008), customer lifecycle developed from the concept of the product lifecycle. Tamosiuniene & Jasilioniene (2009) focused on the development of consumer lifecycle. According to them, consumer lifecycle developed from the different phases of product lifecycle; introduction, growth, maturity, and decline.

From the different stages of the product lifecycle, consumer lifecycle continued to develop from concepts such as consumer acquisition, client retention, and consumer development. It is the interaction with clients at every stage of the product lifecycle which tends to bring the influence on customers having to stay with the business. Currently, Customer Relationship Management and Customer life cycle are understood as social relations. Unlike Customer relationship management, customer lifecycle has a restricted view that focuses on marketing databases and promotional marketing. A more widely accepted idea of customer lifecycle is that it requires the application of technology and emphasizes on one on one interaction with clients by integrating the database knowledge with long-term prospects of company growth and consumer loyalty (Gartner Group, 2008). In a study conducted by Karr (2012), social media is one common aspect that businesses use to connect with consumers at a more personal level. The use of social media in client relationship activities could accelerate a company's performance and help them build tighter social relations.

According to the customer value-based theory developed by Zhong (2008), other prevailing aspects that help tighten social relationships between consumers and the business entail spending time with staff in relationship building, incorporating various forms of investments, sponsoring community events and promotion. Customer lifecycle theory emphasizes a series of steps where the consumer experiences long-term consideration of the time used in the purchase and maintenance of loyalty.


The introduction of customer lifecycle and customer relationship management was necessary because, in today's business field, clients are the prime resource for any association. At the same time, businesses are focused on having consumers at the center because dealing with clients has become an essential activity for an organization (Waqar et al., 2010). The entire accomplishment of organizations is dependent on consumer loyalty, and therefore the latter cannot be accomplished without dealing with clients directly. Consumer lifecycle management is an estimation of various customer related measurements which are then broken down using a timeframe which demonstrates how the business will be executed. With this process, consumer satisfaction is made possible at every step alongside consumer decision journey; from acquisition to loyalty to retention and debt management. The effectiveness of consumer lifecycle and consumer relationship management produces results that boost business growth and profitability. Consumer lifecycle aspects such as promotion, sponsorship, investments and relationship building provide a 360 view of the client and provide solutions to improving satisfaction.

Creating consumer loyalty is necessary to make sure that customer value is enhanced more than the goal to maximize profits and shareholder values (Buttle, 2010). In the past, the budgetary division would depend hugely on item advancement and great innovation. However, with the focus on consumer loyalty and customer lifecycle, organizations are now fighting for the separation of customer management and nature of administration for active practice. Advertising and promotion is a necessary aspect for customer lifecycle because it keeps consumers fulfilled because it creates a view that the business is faithful to its customers (Baron et al., 2010). Customer lifecycle is preferred in customer relationship management because it has a direct impact on profitability. As a component of business management, CRM is a systematic approach to aligning technology and processes in the management of customer lifecycle. Customer lifecycle is concerned with maintaining continuous relations with commitment and trust. CRM becomes comfortable with relationship marketing, business metrics and constant support of top management. With the history and development of relationship management, it is evidence that CRM has evolved into customer lifecycle according to the literature reviewed above. However, while CRM focuses narrowly on customers and marketing functions of an organization, customer lifecycle focuses widely on consumers as well as the entire functions connected directly or indirectly to value creation.


The field of customer relationship management is an extension into many other areas of strategic decision making and marketing. CRM's recent reputation has been facilitated by the different paradigms of marketing that have developed from the themes of collaboration and cooperation of organizational units, customers and stakeholders. With the aspects of sponsorship, marketing, promotion, investments and relationship building Customer relationship management and customer lifecycle should not be understood as a mere software solution implementation project. Instead, both strategies should be viewed as one holistic strategy and a process that propels a business to success. Customer lifecycle together with CRM tend to provide a strategic bridge between information technology and marketing strategies that are aimed at maintaining profitability and long-term relationships.

The integration of social media and customer relationship management gives a business an unprecedented capability to form deep relationships with their clients. The application of social media as a customer lifecycle too is the reason why vendors have increasingly tailed their products by a market shift towards the use of CRM. Many businesses are probably missing out on the benefits of social media because they look at social networking as a sales and support channel instead of looking at it as a way of understanding their customers. Business people should use social media and the mentioned aspects of CRM to help their businesses gain a better understanding of the needs of their customers, aspirations, mood and what they like and dislike.


Baron, S., Conway, T. & Warnaby, G. (2010). Relationship marketing. A consumer experience approach. London: Sage Publications.

Buttle, F. (2009). Customer relationship management. Concepts and technologies. Second edition. Massachusetts: Elsevier Ltd.

Egan, J. (2008). Relationship marketing. Exploring relational strategies in marketing. Third edition. London: Pearson Education Limited.

Gartner Group (2002). Gartner Group strategic planning: Research note. USA.

Gartner Group. (2008). Magic Quadrant for CRM Services Providers North America. Gartner RAS Core Research Note G00156898


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