Business Analytics in Customer Relationships Management (CRM)

Business Analytics in Customer Relationships Management (CRM)

The business environment continues to change in the current world necessitating strategic changes. Business Analytics (BA) is one of the methods that businesses use in order to enhance the prospects of increasing the sells for more income. The increase in competition has pushed businesses to focus on customer relationship management (CRM) as a better option to stay afloat. The ability to identify and retain customers presents an opportunity for businesses to increase sales through targeted marketing. In order to achieve this, a business should be in a position to acquire, store and analyze customer data in order to present it in a way that can influence business decision making (Reinartz, Krafft, & Hoyer, 2004). Business analytics (BA) provides a method that satisfies the conditions. The use of business analytics has the potential of presenting information that helps maintain positive customer relationship.

Applications of Business Analytics

The use of business analytics gives insight into the various ways customer data can be used for various decision-making abilities. It involves data mining of the customer information, storing the same and analyzing it in a way that business management can use it to target and retain loyal customers with higher purchasing power. Analytics helps in grouping the customers in terms of their abilities to purchase the products. In this way, customer segmentation can be achieved to help know those customers who are likely to make repurchase versus those less likely to do so. Such information helps the management identify and retain specific customers with higher purchasing power.


According to Prasongsukarn (2006), business analytics helps in gathering personal information on customer purchasing habits and preferences. Consequently, the business uses such information to model individual marketing strategy. It is easy to target individual customers based on their proven purchasing habits because it enhances the probability to increase sales and make profits. Good information helps improve supply chain system because if the targeted marketing.

Profitability Analysis

Business analytics can help understand the value of customers in terms of their contribution to the profitability of the business. It is possible to know those customers who contribute to the profitability of the business over a period of time. In this way, the business understands how much a customer spends on the products. In addition, the business finds it easy to allocate resources for certain customers to retain them. With a clear data on customer purchasing habits over time, it is easy to dedicate a certain amount of resources that satisfy the customer.

Product improvement

Business analytics helps to gather information on customer satisfaction that can be used to improve the products and services. The best system should allow for customer review on the products and services in order to find out satisfaction levels. Such interaction allows the business to track escalating problems with the products and services on offer. This information helps improve products and services in order to retain customers. A business enterprise without business analytics will likely continue to lose customers blindly without knowledge on customer’s satisfaction levels. The continued changes in standard of life require a continued review of the products and services in order to meet customer satisfaction.

Product Prediction

Good data analysis helps in comparing development plans for various products and services. Knowledge from customers is likely to help study the trend towards the future. With such information, the business will likely work towards innovation towards future products that satisfy and retain loyal customers. Predictive information comes from a platform that allows for customer shares on the satisfaction levels.

Benefits of Business Analytics in CRM

Business analytics helps in improving customer relationship by evaluating customer service by a business enterprise. It helps in analyzing different customers in terms of their purchasing behavior and preferences. On the same note, the information from the business analytics can be used to verify user information for various customers. In effect, the loyal customers will easily be retained while improving supply chain management. Customers are easily reached with less inventory and a faster delivery system. An organization will benefit from lower costs of doing business and a better pricing system that offers a competitive advantage. Targeted marketing campaigns are advantageous for all organizations that use business analytics.

Challenges of Business Analytics in CRM

A major disadvantage of business analytics comes from the difficulty to integrate an analytical software with an existing organizational system (Nguyen, & Simkin, 2013). The challenge of creating a system that collects and analyzes customer information is a stumbling block to the customer relationship management systems. Lack of integration of the system would offer problems with implementation.

Conclusion ­

The competitive business environment requires changes in marketing strategies. The traditional systems no longer yield the required outcomes, thus requiring changes in strategies. Business analytics provides the best methods towards gathering customer information, storing and analyzing in order to present it in a way that helps the management understand customer habits. Targeted marketing is the best option for improving sales. An organization is likely to make improvements that allow it to cut costs on inventory and supply chain. With targeted customers, the goods and services reach the market in good time to save on costs.




Nguyen, B., & Simkin, L. (2013). “The dark side of CRM: Advantaged and disadvantaged

customers”. Journal of Consumer Marketing. 30: 17–30.

Prasongsukarn, K. (2006). “Customer relationship management from theory to practice:

Implementation steps”. Inspire Research Company.

Reinartz, W., Krafft, M., & Hoyer, D. (2004). “The Customer Relationship Management

Process: Its Measurement and Impact on Performance”. Journal of Marketing Research. 41 (3): 293–305.