What Is Relationship Management? And Why Do Businesses Use It?

Written by Coursera Staff • Updated on

Discover how a good relationship management strategy can help your business succeed. Plus, learn to build a CRM strategy in four steps.

[Featured Image] A relationship manager speaks with a customer.

What is relationship management? 

Relationship management, also called customer relationship management (CRM), refers to a business’s process of managing and optimizing interactions with its current, past, and future customers. You can manage customer relationships in your direct interactions with them and through CRM software like Salesforce or Hubspot. 

Relationship management encompasses several aspects of business operations, including: 

  • Activities around selling products and services, such as guiding customers through the sales process

  • Service-related activities, such as helping customers use products and answering their questions 

  • Data analysis to study large amounts of customer data from different channels 

  • Forecasts of future sales growth

A solid approach to relationship management creates the ability to:

  • Observe customers as they mature through the buyer’s journey 

  • Segment customers according to their behaviours and spending habits

  • Create a customer-centric culture in your organization.

  • Value customers for the relationships you can build with them

  • Meet customers’ needs more effectively

  • Increase customer satisfaction

  • Retain customers

  • Drive sales

  • Automate sales (when using CRM software)

Did you know? 

CRM as a concept originated in the 1970s with the storage of customer satisfaction data in mainframe systems and spreadsheets. In the 1990s, different software systems emerged to scale and automate sales. It is thought that United States President Franklin D. Roosevelt’s (FDR) campaign manager, James Farley, created a precursor to modern-day CRM by developing what’s called the “Farley File,” detailing personal and political facts about people that FDR was scheduled to meet. FDR reviewed the file before every meeting to recall details and create rapport. 


Examples of effective CRM

As you learn more about relationship management and consider CRM tools, you might find it helpful to look at some examples of companies with effective CRM practices:

Wells Fargo

  • Responsible for managing over $1.9 trillion in assets

  • Uses a CRM platform to manage services, banking, mortgages, investing, credit cards, etc

  • Automates workflows and optimized platforms, thus saving over 5,600,000 hours of extra work

Bespoke Collection 

  • Four wine brands known for unique and elegant customer experiences

  • Uses a CRM platform to personalize email messages after customers make a purchase

  • Spends time understanding the customers’ behaviours and buying habits

  • Increases customer retention, referrals, and order value


  • Behind many popular video game titles

  • Offers engaging post-purchase customer experiences

  • Monitors social media conversations about their products and follows up with potential customers 

  • Has decreased annual customer service operating expenses by 25 per cent. 

According to Statista, revenue in the CRM software segment is projected to reach over $199 billion by 2027 [1]. 


What does a relationship manager do? 

A relationship manager manages the process of building relationships with customers and clients. 

Their duties might include: 

  • Meeting with prospective clients to present new products 

  • Identifying ways to enhance the company’s communication strategy

  • Communicating with other teams within the company to improve customer experience

  • Offering existing clients advice and assistance with products

  • Keeping customers and clients engaged 

  • Resolving customer complaints and issues

  • Keeping the sales team informed of new opportunities 

  • Analyzing competitors’ CRM strategies to identify ways to outperform them

  • Helping the company maintain a positive reputation 

  • Overseeing the use of CRM software to manage customer information, track communications, and segment customers 

To pursue employment as a relationship manager, you may need a bachelor’s degree in business, management, marketing, or a related field. Experience in customer service or sales is a plus, as you may work directly with customers and clients as a relationship manager. 

According to Glassdoor, the average relationship manager salary in Canada is $82,522 per year [2]. Keep in mind factors that influence salary include location, years of experience, and industry.

How to manage relationships with customers 

A key element of customer relationship management is to step out of a sales-first, transactional way of doing business and into a relational approach. Whether you are seeking employment as a relationship manager or want to take a more customer-centric approach to your own business, there are several strategies you can use to cultivate meaningful relationships with customers.

1. Identify CRM goals. 

Starting with understanding your goals (or that of an employer) can make it easier to design an effective CRM strategy, including the tactics, tasks, and technologies needed to meet those goals. CRM goal examples include retaining more customers, shortening the sales cycle, increasing sales, and decreasing customer-acquisition cost (CAC).  

2. Examine current CRM practices. 

This step can offer insights into which strategies work well and which ones need improvement. Find out how the company: 

  • Stores, organizes, and analyzes customer data

  • Communicates with customers, from before to after a purchase

  • Schedules and assigns tasks among team members 

  • Automates tasks 

3. Identify opportunities to improve CRM. 

Once you get an idea of how the company operates its CRM, the next step is to look for areas you can improve the CRM system. For example, you may find communication breakdowns after customers purchase, leaving them feeling unsupported or disengaged with the brand. Or, you may find the organization isn’t leveraging customer data. 

Improvement measures might include: 

  • Gathering more detailed feedback from customers to discover better ways to serve them

  • Segmenting customers with more precision

  • Monitoring social media mentions of the brand 

  • Automating more tasks 

4. Create a CRM strategy. 

Based on the goals and opportunities for improvement, create a CRM strategy that includes all the tactics, tasks, and technologies you’ll need to implement. Use the following as a starter list:

  • A breakdown of the sales pipeline 

  • How you’ll personalize customers’ experience at every stage of their journey

  • The metrics you’ll be tracking, such as conversion rates and the number of email opens 

  • New customer data you’ll collect and how you’ll label it

  • The CRM tools you’ll use 

  • The specific tasks that team members will be assigned

Improve your relationship management with Coursera

Online courses can be great ways to learn more about relationship management and CRM software and explore career opportunities. Explore the options below: 

Article sources


Statista. “Customer Relationship Management Software, https://www.statista.com/outlook/tmo/software/enterprise-software/customer-relationship-management-software/worldwide.” Accessed June 10, 2024.

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