If you don’t have an accurate view of who your customers are and what their needs or desires are or will be at any given stage in their lives, or if you are losing customers to a competitor, that's a clear indication that you need CRM.
What is CRM?
There are many technological components to customer relationship management, but thinking about CRM in primarily technological terms is a mistake. Instead, a useful way to think about customer relationship management (CRM) is as a strategic process that will help you better understand your customers’ needs and how you can meet those needs and enhance your bottom line at the same time.
A successful CRM strategy depends on bringing together lots of pieces of information about customers and market trends so you can more effectively market and sell your products and services.
With an effective CRM strategy, a business can increase revenues by:
- providing services and products that are exactly what your customers want
- offering better customer service
- cross selling products more effectively
- helping sales staff close deals faster
- retaining existing customers and discovering new ones
These revenue gains don't happen by simply buying software and installing it. For CRM to be truly effective, an organization must first understand who its customers are, their value, their needs, and how best to meet those needs. For example, many financial institutions keep track of customers' life stages in order to market appropriate banking products like mortgages or IRAs to them at the right time.
5 keys to a successful CRM implementation
- Develop your customer-focused strategy first before considering what kind of technology you need.
- Break your CRM project down into manageable pieces by setting up pilot programs and short-term milestones. Start with a pilot project that incorporates all the necessary departments but is small enough and flexible enough to allow tinkering along the way.
- Make sure your CRM plans include a scalable architecture framework. Think carefully about what is best for your enterprise: a solution that ties together “best of breed” software from several vendors via web services or an integrated package of software from one vendor.
- Don't underestimate how much data you might collect (there will be LOTS) and make sure that if you need to expand systems you'll be able to.
- Be thoughtful about what data is collected and stored. The impulse will be to grab and then store EVERY piece of data you can, but there is often no reason to store data. Storing useless data wastes time and money.
Next, the organization must look into all of the different ways information about customers comes into a business, where and how this data is stored and how it is currently used. One company, for instance, may interact with customers in a number of ways, including email campaigns, web sites, brick-and-mortar stores, call centers, mobile sales force staff and marketing and advertising efforts. CRM systems link up each of these points. This collected data flows between operational systems (like sales and inventory systems) and analytical systems that can help sort through these records for patterns. Company analysts can then comb through the data to obtain a holistic view of each customer and pinpoint areas where better services are needed. For example, if someone has a mortgage, a business loan, an IRA and a large commercial checking account with one bank, it behooves the bank to treat this person well each time it has any contact with him or her.
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