CRM (Customer Relationship Management): How to avoid mistakes and succeed

The importance of Customer Relationship Management or CRM is widely discussed nowadays, however, for many people it is a vague notion, often misinterpreted or misused. In reality CRM, if understood and implemented correctly can bring a lot of benefits to the company.

Let’s begin with the definition. Encyclopedia Wikipedia defines CRM in the following way: “CRM encompasses the capabilities, methodologies, and technologies that support an enterprise in managing customer relationships. The general purpose of CRM is to enable organizations to better manage their customers through the introduction of reliable systems, processes and procedures”. In essence CRM helps companies use technology and human resources to gain insights into customers’ behavior and their value to the company. Properly functioning CRM can achieve the following:
- provide more effective and efficient customer service
- simplify marketing and sales processes
- gain new customers
- help in closing deals
- increase revenues

The architecture of CRM has three distinct parts:
- operational – automation of basic processes, such as marketing, sales and customer service
- analytical – support in analyzing customer behavior (business intelligence technology)
- collaborative – ensures a proper contact with customers (phone, e-mail, web, post, etc.)

As clear as it sounds, CRM creates a lot of confusion and that is why we would like to point out the common mistakes businesses make in implementing it and the ways to avoid them:
1. The majority of people think that CRM is a software. Although a software package might be a part of the CRM support systems, CRM is not a technology in itself, it is a CORPORATE LEVEL STRATEGY, which focuses on creating and maintaining long-term relationship with customers. It unites under its umbrella several companies functions: marketing, sales and customer service. Thus, the starting point of CRM implementation is the buy in of all employees, understanding it, accepting it and living by it.

2. The definition of “Customer” is taken too narrow. Very often it is perceived that the Customers is only a group of people who is already buying your product/service and a target group of people who are not buying yet but you are hoping to win them over. We would argue: think wider! Your customer is everyone who your company and its employees come in contact with in their day-to-day work. It’s a person who submitted an application to an open position in your company, it’s a person who sent you an e-mail question about your website, it’s a person your marketing manager met at a networking event, etc. Why? Because all these people have a power of forming opinion about your company and passing it on to other people they know who might be your direct customers.

Just an example: some time ago I met a nice lady realtor (or at least she seemed nice) at one of the networking events and I put her business card aside for the time my husband and I decide on buying a house, which will probably happen within 24 months’ time. After the event I decided to keep this connection and I wrote her a follow-up card (a personal card which I sent her by USPS) and also an e-mail and told her a little bit about my business too. She never replied. Do you think I will be buying my house with her? Do you think I will pass her contact details to 2 couples who are friends of ours who are also looking to buy a house? I was not her immediate direct customer at the time we met but somehow she has just lost 3 clients.

3. It is also a common mistake companies make when they install a CRM software package, collect loads of information about customers and do not know what to do with it or rather do not use it to full extend. A quarterly e-mail notice about seasonal discounts is not the way to build lasting relationships with customers. In the times of tough competition successful marketing is not about meeting customer needs it is about exceeding customer expectations. They will probably receive a dozen direct mails about seasonal discounts but only 1 Happy Independence Day card – and it could be from YOU!
4. Poor responsiveness. When I moved to USA from Europe my biggest cultural shock was a complete neglect of incoming correspondence. Due to the nature of my work I communicate with a lot of stakeholders on a daily basis and about 95% of my letters (either sent via e-mail or USPS) remain unanswered. Every business professional I meet in America admits it’s a problem here and still he rarely answers my meeting follow-up letter himself. But I have to do justice to 3 corporations based here in Chicago that always come back to me (and I love them for that): Wm. Wrigley Jr., GE and Hyatt. And coming back to point #2: these are not my affiliates and I am not their direct customer (well, may be Wrigley, sometimes) but I have just promoted them globally free of charge!

You would probably argue that you have hundreds of e-mails coming your way every day and you cannot deal with them all. You know what my answer would be? – You just don’t have a CRM system in place. I personally have a rule of answering an e-mail within 48 hours of receiving it (except when I am on vacation but then a person receives an auto-reply with apology informing him when I will get back). The same stands for EMAdvice company website: we claim we answer all correspondence within 48 hours and we DO!

5. Company websites are not used to their full capacity. Website should not be a “read only” tool. It should be a “living” tool that involves all the time and engages your customer in communication and interaction. I saw wonderful websites, which have some games on them, competitions, sign-ups for newsletters, etc. Do not be boring – make your customers want to come back to you.

So this was theory, now how can this be implemented in practice and on a budget?
I will not talk about commercial softwares available on the market but rather point out some little things you can do which will improve your relations with customers dramatically:
1. Always answer your correspondence. Just a “Thank you” note of appreciation will do.
2. Utilize your website capacity to its fullest, sign people up for events, competitions, newsletters, feedback forms etc. This way you will kill 2 birds with 1 stone: you will engage your customers as well as collect important data about them (contact details, preferences, etc.) which will help you to understand their behavior.
3. Newsletter is a great tool! It shouldn’t be fancy if you don’t have money for that it can be simple, say in MS Word format with some pictures, but RELEVANT to your customer. And by newsletter I do not mean information on promotion and discounts. Your newsletter should carry information of interest to the customer, do not impose information YOU want them to know. Newsletter is for them, not for you. If you own a restaurant – send articles about healthy diets, if you own an airline – write about aviation in general, security at the airports etc. And only at the end of the newsletter write a little paragraph about your business. Also try to send out the news regularly, at least every other month.
4. When was the last time you pleasantly surprised someone? Go surprise your customer, send them a greeting card! There are several articles about the power of postcards as a direct mail tool on this forum and I will not repeat their content I will just say that I completely agree with them. Another question is where to find great, affordable and time saving cards service? Well, here we can help: go to our company website www.emadvice.com and check the MARKETING TOOLS section. I promise: you will be pleasantly surprised that you can send an original, glossy, handwritten card for just 70 cents including handling and postage (designing (there are 2500 designs readily available for personal and business purposes), handling and postage will be done by someone else for you!)

I hope after reading this article CRM will be a bit less complicated for you and bring your company a bit more business (well, I hope a LOT more but you have to start small to grow big!)

Article Source: http://www.mycontentbuilder.com

About the author: EMAdvice = Emerging Markets Advice (www.emadvice.com) provides consulting services in the field of international marketing and busiess development. We are your Navigator in the uncharted territory! EMAdvice also provides a unique CRM/direct mail service - SendOutCards.

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