Customer data management
Encyclopedia
Customer data management (CDM) is a term used to describe the way in which businesses keep track of their customer information and survey their customer base
in order to obtain feedback. CDM embraces a range of software or cloud computing
applications designed to give large organizations rapid and efficient access to customer data. Surveys and data can be centrally located and widely accessible within a company, as opposed to being warehoused in separate departments. CDM encompasses the collection, analysis, organizing, reporting and sharing of customer information throughout an organization. Businesses need a thorough understanding of their customers’ needs if they are to retain and increase their customer base. Efficient CDM solutions provide companies with the ability to deal instantly with customer issues and obtain immediate feedback. As a result, customer retention
and customer satisfaction
can show dramatic improvement. According to a recent study by Aberdeen Group
inc.: "Above-average and best-in-class companies... attain greater than 20% annual improvement in retention rates, revenues, data accuracy and partner/customer satisfaction rates."
. Businesses can decide who, within their company, should have the ability to create, adjust, analyze or share customer information. In December 2010, 52% of Information Technology
(IT) professionals worldwide were deploying, or planning to deploy, cloud computing; this percentage is far higher in many countries.
(EFM). Customer data management (CDM) was introduced as a software solution that would replace earlier disc-based or paper-based surveys and spreadsheet
data. Initially, CDM solutions were marketed to businesses as software, specific to one company, and often to one department within that company. This was superseded by application service providers (ASPs) where software was hosted for end user organizations, thus avoiding the necessity for IT professionals to deploy and support software. However, ASPs with their single-tenancy architecture were, in turn, superseded by software as a service
(SaaS), engineered for multi-tenancy. By 2007 SaaS applications, giving businesses on-demand access to their customer information, were rapidly gaining popularity compared with ASPs. Cloud computing now includes SaaS and many prominent CDM providers offer loud-based applications to their clients.
In recent years, there has been a push away from the term EFM, with many of those working in this area advocating the slightly updated use of CDM. The return to the term CDM is largely based on the greater need for clarity around the solutions offered by companies, and on the desire to retire terminology veering on techno-jargon that customers may have a hard time understanding.
Customer base
The customer base is the group of customers and/or consumers that a business serves. In the most situations, a large part of this group is made up of repeat customers with a high ratio of purchase over time. These customers are the main source of consumer spending...
in order to obtain feedback. CDM embraces a range of software or cloud computing
Cloud computing
Cloud computing is the delivery of computing as a service rather than a product, whereby shared resources, software, and information are provided to computers and other devices as a utility over a network ....
applications designed to give large organizations rapid and efficient access to customer data. Surveys and data can be centrally located and widely accessible within a company, as opposed to being warehoused in separate departments. CDM encompasses the collection, analysis, organizing, reporting and sharing of customer information throughout an organization. Businesses need a thorough understanding of their customers’ needs if they are to retain and increase their customer base. Efficient CDM solutions provide companies with the ability to deal instantly with customer issues and obtain immediate feedback. As a result, customer retention
Customer retention
Customer Retention is the activity that a selling organization undertakes in order to reduce customer defections. Successful customer retention starts with the first contact an organisation has with a customer and continues throughout the entire lifetime of a relationship...
and customer satisfaction
Customer satisfaction
Customer satisfaction, a term frequently used in marketing, is a measure of how products and services supplied by a company meet or surpass customer expectation...
can show dramatic improvement. According to a recent study by Aberdeen Group
Aberdeen Group
Aberdeen Group Inc. is a provider of fact-based research helping organizations and individuals make better business decisions. Founded in 1988, Aberdeen Group tries to understand the implications and results of process innovation, methodology advancements, technology deployments, and business...
inc.: "Above-average and best-in-class companies... attain greater than 20% annual improvement in retention rates, revenues, data accuracy and partner/customer satisfaction rates."
Customer data management and cloud computing
Cloud computing offers an attractive choice for CDM in many companies due to its accessibility and cost-effectivenessCost Efficiency
Cost efficiency , in the context of parallel computer algorithms, refers to a measure of how effectively parallel computing can be used to solve a particular problem...
. Businesses can decide who, within their company, should have the ability to create, adjust, analyze or share customer information. In December 2010, 52% of Information Technology
Information technology
Information technology is the acquisition, processing, storage and dissemination of vocal, pictorial, textual and numerical information by a microelectronics-based combination of computing and telecommunications...
(IT) professionals worldwide were deploying, or planning to deploy, cloud computing; this percentage is far higher in many countries.
Uses for management
Customer data management- should provide a cost-effective, user-friendly solution for marketingMarketingMarketing is the process used to determine what products or services may be of interest to customers, and the strategy to use in sales, communications and business development. It generates the strategy that underlies sales techniques, business communication, and business developments...
, research, sales, human resourcesHuman resourcesHuman resources is a term used to describe the individuals who make up the workforce of an organization, although it is also applied in labor economics to, for example, business sectors or even whole nations...
and IT departments - enables companies to create and email online surveys, reports and newsletters
- encompasses and simplifies customer relationship managementCustomer relationship managementCustomer relationship management is a widely implemented strategy for managing a company’s interactions with customers, clients and sales prospects. It involves using technology to organize, automate, and synchronize business processes—principally sales activities, but also those for marketing,...
(CRM) and customer feedback managementCustomer Feedback Management servicesCustomer feedback management online services are web applications that allow businesses to manage user suggestions and complaints in a structured fashion.- Methodology :...
(CFM)
Background
Customer data management, as a term, was coined in the 1990s, pre-dating the alternative term enterprise feedback managementEnterprise Feedback Management
Enterprise feedback management is a system of processes and software that enables organizations to centrally manage deployment of surveys while dispersing authoring and analysis throughout an organization...
(EFM). Customer data management (CDM) was introduced as a software solution that would replace earlier disc-based or paper-based surveys and spreadsheet
Spreadsheet
A spreadsheet is a computer application that simulates a paper accounting worksheet. It displays multiple cells usually in a two-dimensional matrix or grid consisting of rows and columns. Each cell contains alphanumeric text, numeric values or formulas...
data. Initially, CDM solutions were marketed to businesses as software, specific to one company, and often to one department within that company. This was superseded by application service providers (ASPs) where software was hosted for end user organizations, thus avoiding the necessity for IT professionals to deploy and support software. However, ASPs with their single-tenancy architecture were, in turn, superseded by software as a service
Software as a Service
Software as a service , sometimes referred to as "on-demand software," is a software delivery model in which software and its associated data are hosted centrally and are typically accessed by users using a thin client, normally using a web browser over the Internet.SaaS has become a common...
(SaaS), engineered for multi-tenancy. By 2007 SaaS applications, giving businesses on-demand access to their customer information, were rapidly gaining popularity compared with ASPs. Cloud computing now includes SaaS and many prominent CDM providers offer loud-based applications to their clients.
In recent years, there has been a push away from the term EFM, with many of those working in this area advocating the slightly updated use of CDM. The return to the term CDM is largely based on the greater need for clarity around the solutions offered by companies, and on the desire to retire terminology veering on techno-jargon that customers may have a hard time understanding.