Customer Relationship Management (CRM) defines how you interact with your customers.
Have you heard of ‘CRM’?
It means Customer Relationship Management and it’s definitely something that all business owners, executives and managers should be thinking about.
In her article on the Superoffice blog, Jennifer Lund quotes the following as reasons why people in business need to be interested in Customer Relationship Management:
- 86% of customers are willing to pay more for a better customer experience
- Customer focused companies are 60% more profitable than those that aren’t
- 1 in 3 customers will leave a brand they love after just one negative experience
Understanding Customer Relationship Management
CRM can be quite hard to understand. Infact, some business owners have never even heard of CRM. I believe the reason is two fold.
First is the jargon. From my first day on the job with AGContext, I noticed how Carl switched terms such as Customer Management and CRM. Further more, he said “You can’t refer to Customer Management as CM, because that is the industry abbreviation for Content Management”. I asked “So why has the word ‘relationship’ been added? Why not just use Customer Management?” After my own research, I discovered the answer.
Traditional Customer Management relates only to what we do ‘to’ the customer. It is a one sided transaction where we collect and store information but don’t share it. In contrast CRM defines how we interact ‘with’ our clients. This means two way communication. As a result we become more customer focused in our sales and service.
Second is context. CRM, as an acronym, began life as a business management theory. However, if you Google “Customer Relationship Management” today, the links that will be returned are all software related. The reason for this is best summed up by the bank robber Willie Sutton:
How well do you know your customers?
Assumptions and a lack of communication are the number one relationship killers in any relationship, including your businesses relationship with your customers. We all perceive the world differently and we hold different views as a result about what is valuable. It is better to seek to understand before being understood. After all, strong relationships in life and business are built on reliable and respectful communication.
So, with this in mind, ask yourself:
- what do people need or want from my business?
- what are my customers’ expectations about how my business should operate?
- how does my business produce and deliver these wants and needs?
The benefits of CRM
On the most basic level the desired outcome of customer relationship management is an increase in happy customers. Happy customers equal return business and return business equals greater profitability. Further and more substantial outcomes are listed below:
- reduced costs due to an increase in effective and efficient operation
- increased customer satisfaction, because they are getting exactly what they want
- ensuring that the focus of the organisation is on the customer.
- growth in the numbers of customers
- maximisation of opportunities such as increased services, referrals, etc.
- increased access to a source of market and competitor information
- highlighting poor operational processes
- long term profitability and sustainability
Now, with an increased understanding of the ‘what’ and ‘why’ of CRM, it’s time to think about the ‘How’
Find the best Customer Relationship Management software
There really is an overwhelming amount of CRM software tools available on the market today. Unless you want to find your own way through the hundreds of options available, engaging the help of a business analyst who knows how to do this is your best option. AgContext can partner with your business to:
- Develop a visual customer relationship management plan (or customer journey map)
- Identify your specific needs for functions and features of software
- Evaluate and assess the best software for your budget
- Negotiate trade-offs and work arounds in software choices
- Assist with transition from current to recommended software
- Communicate and manage software vendors
For further advice on choosing the best customer relationship management software for your business download our free eBook.