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VENDOR RELATIONSHIP
MANAGEMENT [VRM]

lecturers, trainers & students :
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I have never been a big fan of the concept of Customer Relationship Management [CRM], as I say in Internet Marketing:

'I think that managing relationships with customers is a better description of the objectives behind the concept. This re-wording shifts the emphasis to customers - as it should be - and away from customer relationship management where the title suggests the task of managing something that is a burden to the organization - like waste disposal, for example.'

And that ...

'Another key element to CRM is that it assumes there is a relationship between the organization or brand and the customer - and that the customer wants a relationship.'

I also express my view that - particularly at the turn of the century - IT took over CRM, with a subsequent concentration on what technology could do - not what commercial objectives it might, or might not, be able to achieve.

With VRM the onus is on the customer to manage their relationship with organizations - not have any relationship - and its management - thrust upon them. The customer decides what personal information they wish to volunteer. I like this idea. I think it is market-led - which is at the very core of market orientation. VRM requires that the organization trusts its customers to manage their information. This encourages two-way communication - which ultimately will lead to increased customer satisfaction on one side, and profitability on the other.

Effective VRM might even bring about that Holy Grail of online marketing - the truly personalized website. Amazon, for example, would not have to depend on my on-site searches and purchases to decide on my interests [that flower book I bought my wife once took months to filter out of the equation]. Instead, I would tell Amazon what products or brands I want to hear about. And I would trust that their CRM systems would be sympathetic to any interests or hobbies I might declare, and use them sparingly - not spamming me with vaguely connected products simply because someone has paid for them to be promoted.

From a marketing perspective, effective VRM should make life easier - after all, the punter is doing most of the work. What the the e-marketer must do, however, is provide the means for the customer to provide their information - by whatever medium they choose or find most convenient, be that direct on your website or through any one of the plethora of 'social media' platforms.

Finally, I can't go without emphasizing that CRM and VRM only work for certain products and certain customers. Some products will always be transactional in nature. I do not want a relationship with my milk supplier, for example. Its milk. I buy it. I drink it. End of story.

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