Integration of Artificial Intelligence into Customer Relationship Management Systems

an analysis of customer retention impacts for Indian small-scale startups

Abstract

This study investigates the major variables influencing the effective implementation of Artificial Intelligence (AI) into Customer Relationship Management (CRM) systems, with an emphasis on technology improvements, financial constraints, workforce capabilities, and vendor choice and their relationship to customer retention. It also examines the challenges faced by businesses, including financial constraints and resistance to change, in adopting AI-driven CRM strategies. By analysing both academic and practical perspectives, the study aims to provide insights into effective methods for overcoming these barriers and optimizing CRM practices for improved outcomes. A quantitative study was employed, with a survey of 103 participants conducted with Indian Start Up entrepreneurs, Customer Relations Managers and Systems Managers. The data was analysed using multiple linear regression analysis in SPSS. The research evaluates how these factors contribute to improved CRM outcomes and customer retention. The results emphasize the importance of customization, financial planning, workforce AI readiness, and strategic vendor partnerships in optimizing CRM systems. AI's ability to automate processes and provide personalized customer experiences is a crucial factor in reducing churn and fostering loyalty. The study concludes that Indian small-scale startups should invest in AI-driven CRM strategies to enhance competitiveness, while overcoming financial and workforce-related challenges.