What does customer relationship management (CRM) involve?

Customer relationship management (CRM) involves strategies for managing interactions with customers, focusing on enhancing the customer experience and building long-term relationships. CRM systems help businesses collect and analyze customer data, streamline communication, and personalize interactions. This proactive approach allows companies to better understand customer needs and preferences, ensuring they can tailor their services and offerings effectively.

While providing discounts can be a tactic used within a CRM strategy to improve customer retention, CRM as a concept is much broader and is specifically about managing the overall interaction and relationship with customers. Analyzing competitor pricing is important for market positioning but does not directly relate to managing customer relationships. Additionally, researching market trends is valuable for understanding the broader business environment but is separate from the interpersonal and direct interaction focus of CRM. Thus, the emphasis on managing interactions is what makes the correct answer the best choice.