Consumers Who Pay A Premium

13Sep10

As consumers, the decisions we make to buy particular products and/or services are primary based on cost and need(s).  While the economy has forced many to budget and find other creative ways to cut spending, some consumers are still willing to pay a premium.  So, how are certain companies still able to charge more than its competitors?   

One primary reason relates to effective customer relationship management (CRM).  Even above issues with product or service or the competition, most customers lose loyalty over service problems, that is lack of good customer service.  A customer who is treated poorly when trying to resolve an issue is not likely to continue using the company’s service or products (unless there are no other alternatives). 

In order to effectively manage its customer base, many companies use CRM software.  CRM software has allowed companies to increase productivity while reducing cost, which are important factors towards an organization’s ability to gain or maintain a competitive edge in this tough economy.  While the use of CRM software can produce positive results, organizations need to make sure it does not alienate the customer.  Thus, CRM software should not replace customer relationships, rather it should be one of the tools company’s use to build stronger customer relationships. 

By keeping a “pulse” on customer satisfaction and retention, companies are able to effectively monitor their CRM strategies.  Generally speaking, customers who are more satisfied are less likely to switch to a competitor.  Thus, CRM should be a long-term focus of the company, rather than simply a process to be implemented.  

As a consumer, what determines your satisfaction in using a particular product or service?

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