The Relationship between Customer Relationship Management and Product Innovation

Abstract

In the last decade, businesses have been under pressure to find innovative ways to meet customers’ expectations in an increasingly competitive and globalized marketplace. In response, enterprises focused on innovating their products to retain old customers while attempting to attract new ones. In this vein, businesses have promoted customer relationship management (CRM) systems as a critical contributor to product innovation. This article used quantitative correlational design to examine the relationship between the use of CRM system in small to medium size companies in the United State (US) and product innovation. The study investigated whether the use of CRM system helps businesses innovate products in US and increase their profitability. The data was collected from selected sample of ten small to medium size companies in the US by answering SurveyMonkey’s questions. IBM Statistical Package for Social and Sciences (SPSS) system, version 23 was used for tabulating, which considered essential to achieve a reliable and valid result. The correlation coefficient (r) of .371 measures the strength and direction of a linear relationship between the CRM system and product innovation, which has a value of 0.47. The two null hypotheses were rejected stating that there is a negative correlation between the predictor and criterion variables.