Customer Relationship Management (CRM)
According to a PricewaterhouseCoopers study, 81% of fastest growing US companies that initiated a CRM program achieved 46% faster revenue growth than their competitor without CRM.
What would faster growth mean to your business?
What is CRM?
Customer Relationship Management. CRM aims to help you to optimise your business revenue by giving you a clearer picture of your customers. With some technical tools you should be able to alleviate administrative tasks that take time (therefore, cost money) and reduce the margin for error by taking away repetitive tasks.
CRM solutions were first developed in the 1990’s – many implementations failed and many companies had a general perception of over promise and under delivery.
Now solutions are more flexible, competition has driven prices down making CRM more affordable than ever before and true benefits are being realised from businesses in all sectors.
You may also hear CRM solutions being called;
- Customer Management
- Contact Management
- Client Management
- Total Relationship Management
- Total Customer Management
We asked leading CRM suppliers that we work with at IT Shortlist to share their material and case studies with us. Using it we have written this article that very simply sets out the key advantages of CRM, what it can do for your business, what you need to think about when considering CRM and how to make it a success.
What effects can a CRM system have on your business?
The more information your teams have regarding your customers the better able they will be to deal with them effectively and professionally at every point of contact during the customer’s relationship with your organisation.
- A greater understanding of your customers will help you to target your marketing efforts to win more business and it can be invaluable in the development of new products and services
- Having sight of your customers’ history and buying cycles will give your staff the ability to see opportunities to maximise sales by selling additional or upgraded products or services to them
- Having a better understanding of your customers’ requirements will help you to anticipate their needs. It will also help with the development of products and or services and can help you to cut costs
- Having sight of buying cycles will help you to gear your business more efficiently and effectively to maximise sales and add increased customer loyalty
- If your customers are happy with your products and services and the interaction they have with all members of staff they are more likely to remain loyal to you
- Sales people can easily get caught up in managing customers. Better information for all team members can help with the transition of the relationship from new business sales to account management. This will free up your sales people’s time and allow them to get on with selling.
The key to making CRM work for your organisation
To make it work you first of all need an objective (goal) and you need to make CRM a part of the overall strategy to achieve your objective. The CRM solution will give you the tools to achieve your goal.
Do you have an objective?
You have an objective if you need to grow your business by;
- winning new customers
- and or increasing the billing value of your existing customers
- or reducing the cost to manage your customers
What should you think about when considering a CRM solution?
Let’s consider what typically happens during the process of selling to a new customer; winning their business and looking after them. During this time activities pass between marketing, sales, operations, legal, accounts and account management (after care):
- Marketing to your target audience
When your target audience is identified, the marketing department can determine how to engage with your audience using a variety of marketing communications to create awareness of your company and its’ products or services. Typically this will include a broad focus such as advertising through to targeting an individual by letter or email. Successful marketing is about getting the right message to the right person at the right time.
- Sales Process
In many organisations the marketing department will provide sales with the sales material and all the reasons why a customer should buy from you.
Typically the sales process follows a pattern along the lines of; contact (meeting or phone) follow up (letter, information, email) contact, follow up, contact, follow up and close; credit check and contract.
- Delivery and customer service
Once you have delivered to the customer and issued an invoice, the follow up care you provide for your customer can make or break the relationship. In very general terms the average time a customer will remain loyal to their supplier is 3 years. With great customer service and value for money the time a customer keeps buying from you could be extended. Confidence in the service / delivery is a big influence on loyalty.
- What support do your customers look for?
If you think about how your customers behave, you can more easily map a system to manage their behaviour and help you to achieve efficiencies in your business.
- What do you have to offer your customers when they have a question about your products / services / delivery / billing?
- Do your customers revert to the sales person they built up a relationship with, because they don’t know who else to speak to? Are your sales people less effective because of this?
- Do they visit your website and rely on a list of FAQ’s – can they easily find the right answers.
- Do they phone the office and have to wait for the answer or have to be called back – or are they asked to call back when the appropriate person is available – it happens!
- Do they email? Do they get a response?
Do you know?
- How and where do you hold information about your customers?
If details about your customers are held in different systems in each department, the sharing of this information can be very difficult. Access to essential information can make a real change to the levels of customer service you offer.
The data protection act now states that data (customer records) must be password protected if it is being sent electronically to another party – if your sales people are working in the field and need to pass data between them and other colleagues they must, by law, password protect it.
For many reasons making information available from a central point can make real sense.
Will a CRM system help you to speed up the sales process or win more business?
If your sales people can access your CRM database when they are on the move it will help them to maximise their time. For example, giving them tools to be able to identify prospects to fill a cancelled appointment at short notice will enable them to sell more and save otherwise wasted time.
Taking away non sales activity will help them to focus more of their time on selling and therefore sell more.
Companies using CRM systems have reported to have; increased sales calls by 25-50%, a three-fold increase in productivity, 15% increase in revenue, 25-50% increase in revenue per customer. One case study reported to have saved 360 hours in a single week across their 90 sales people – the equivalent to an extra 9 sales people.
How can it deliver better Customer Service?
Giving great customer service will definitely make you stand out from your competition. All too often we see companies who try to use language and make up new phrases to set themselves apart. If the information available to the individuals managing your customers is good, they will be equipped to deliver.
What about flexibility?
Many systems offer a great deal of flexibility too, adapting to your needs as your business changes. Check that systems are scalable to grow with you if you foresee major growth or possible change in the future.
How to make your project a success
Adopting CRM may mean a change to your existing company culture. It is essential that your project is supported by all senior executives in the business and has a strong project leader. If the project is not supported by these key people there is a risk that staff will not adopt new practices and will just continue to follow old habits and work processes.
Everyone involved in the project must understand what is meant by a successful implementation. Will the success of the project be judged by;
- Implementing on time
- On budget
- By adoption of the new system
- Other measures?
What about hosted systems or SaaS?
SaaS is an alternative to buying software licences and is charged on a per seat, per month basis.
The software is provided over the internet (on-line) and alleviates the need for internal IT support and hardware such as your own server.
For more information please contact us for a copy of our article; Software as a Service (SaaS).
Conclusion and the Market
CRM has revolutionised the way business is conducted. It is now entirely possible to increase productivity and reduce costs. There are hundreds of UK based CRM providers – use our free service to find the best one for your business.
IT Shortlist is independent, unbiased and impartial. Visit our website www.it-shortlist.com to see how we can make your software search easier and get your project off to the best start.
