The Importance of Using CRM in your Business
The notion of Customer Relationship Management (CRM) has become an important focus for every organisation’s corporate strategy. It extends beyond the fundamental concept of database marketing, and aims at creating, developing, and enhancing corporate relationships with customers. In fact the predominant idea is that customer life-time value can be optimised when deeper relationships are formed between carefully targeted customers and the business organisation.
The Internet has accelerated the seismic shift toward customer-empowerment, bringing with it a need for real-time execution and immediate response to changing customer requirements. The customisation of products or services to a client’s specific situation and requirements is today a reality and not merely a theoretical concept. In this respect, the integration of CRM systems with the multiple channels of sale, including the Internet and social media, is necessary to better market, sell, and serve customers through a much stronger link between critical business functions and the technical infrastructure that support them.
The Challenge
When implementing a CRM solution, however, it is quite common to discover the degree to which modern business organisations still operate on a foundation of disparate and sometimes incompatible information systems. Such an infrastructure limits business values; rendering any such value difficult, if not impossible, to quantify.
To prosper, it is imperative for firms to have information systems in place that provide a ‘holistic’ view of customers and a deeper insight into their respective wants and needs.
With flexible, leading-edge computer systems providing instant access to up-to-date, detailed information – sometimes at the point of sale – cross-selling opportunities and profitability can be maximized. However, this requires much more than implementing the latest, state-of-the-art, technology. Only through the fundamental realignment of people, processes, and technology can firms gain the capabilities necessary to accurately determine customer profitability, product ownership, and delivery channel preference to succeed.
Introducing Customer Management
Fundamentally, a CRM solution provides the strategy and the implementation support needed to deliver the right products or services, together with the necessary service levels, to meet the expectations of the most profitable customers. CRM links existing corporate capabilities and fills in the missing elements to move organisations from a line of business-dominated state to a truly customer-centred environment.
A primary goal of a CRM solution is to develop a customer data repository where the various fragments of customer data can be collated and enhanced into a valuable business asset. As the scope of the customer data repository grows to provide a more complete view of individual customers, the capability of the organisation to respond to new customer needs and opportunities increases substantially.
CRM solutions assist business organisations to better understand and influence customer behaviour and profitability. This insight enables firms to tailor products, provide consistent multi-channel access and service levels to meet customer needs. In addition, business organisations can maximize profits by identifying profitable and unprofitable customer segments and taking appropriate action.
Through CRM, organisations can begin to address the challenge of realigning business processes and technology in order to build and retain profitable customer relationships. The transition from a product or service-oriented organisation to a customer-centric one requires a rethink of such aspects as, for example:
• Which customers are most profitable to the organisation and is the organisation allocating them the attention they deserve?
• How can the organisation retain customer loyalty – and do so in a cost-effective manner by consistently delivering the right communications, incentives and opportunities that keep individual consumers committed to the organisation’s brand?
• What marketing tactics and campaigns work best for the organisation?
• Which customers present the most potential for cross-selling and up-selling possibilities?
• Which customers respond faster to new offers and who are my early adopters, opinion leaders and trial enthusiasts who will quickly purchase, spread awareness of, and increase advocacy for new products or services?
Conclusion
The world is changing exceedingly fast for every business organisation. To maintain competitiveness and help ensure long-term survival, these business organisations need to comprehensively understand their customers like never before – their behaviour, actions, lifestyles, and preferences.
Customer Relationship Management lays the foundation for business organisations to:
• understand better customer needs;
• build valued, long-term relationships;
• manage profitability at the customer level;
• contain ancillary and unnecessary costs;
• improves product and service branding and customer allegiance;
• implement cost-effective and efficient management and operational processes;
• collect and effectively use information to achieve a more holistic view of the customer.
There are countless ways to leverage the CRM towards developing new opportunities. Applications such as cross-selling, up-selling, profitability analysis, and campaign management are just a few, and innovative possibilities are evolving all the time. However, the need and depth of customer information is a critical success factor that is consistently required.
CRM systems must not only provide the ability to capture information from operations systems, but must also facilitate a cooperative exchange of customer information across the whole organisation, in order to build competitive advantage.