| By Richard Minney, Cofounder of iBE.net
Customer relationship management (CRM) has two main elements:
- A database with details on every past and current customer and prospect.
- A process of converting the initial lead or contact to a customer, and to engage in repeat business.
Easy? It sounds simple enough, but in reality most companies handle CRM poorly. Some companies are good at closing deals; some are good at generating new leads; some are good at building long term relationships. The companies that tend to last the longest are those that have repeat business full of loyal customers who come back time after time to spend more money, because these customers in turn become a driver for more business through referrals. Most organizations can look at some part of the customer acquisition process and honestly believe, “We’re good at that part.” But to be world-class at CRM it's necessary to do all parts well.
Here is a five-step guide to getting better results with CRM.
Collect and Store Data
Collect and store all the information you can get about every customer in your CRM system. Find out what industry they are in, why they chose your company and product, geographic data, demographic data, what competitive products they looked at before making the right choice, etc. Bring in data from third party sources such as company profiles on Hoovers or OneSource, or from on-line research including LinkedIn profiles.
You will eventually have enough data to build some good profiles of your typical buyer; then you will be in a better position to create targeted advertising to bring in more customers that meet your existing profile. It will also be much easier to look for customers with similar profiles to widen your reach to either side of your current target without straying into unknown territory. That way, you can expand your market without stretching your reach too far.
Build a Communication Timeline
Determine the best frequency and order of communications with new customers. You can start with a thank you and welcome them to the company. For the next step, move on to hints on how to get the best from your product to begin building a relationship and loyalty. Add to this further information they will find useful and 100% relevant to what they bought. As a way of building repeat business begin to introduce them to complimentary or add-on products they may have a need for.
This cycle can be repeated so that most communications are adding value for the customer and building a relationship. Notice that only one in four or five communications should be looking to make additional sales, the vast majority of the communications are about building a relationship and credibility and someone who really cares about your customers’ success. This same cycle can be used for existing customers by applying a modified timeline to further strengthen the relationship before you try selling more to them. You are aiming for a sweet spot of sending just slightly more information than they would normally like – enough to keep you top of mind – but not so much that they feel badgered.
Analyze Sales Data
Look at your top spending and most profitable customers and see if there are any factors that link them, factors you can use in advertising to reach more of the same type. Then create focused advertising to reach out to customers closely matching those with whom you are already successful. Talk to your existing customers and ask them to provide short testimonials or interview them to draft a customer case study that you can show to prospects to let them see how you already satisfy customers in a similar sector as their own. And identify points in the process where prospects are being lost; these are choice areas where a small improvement in either the qualification or the sales process can make a big difference.
Make the Data Accessible in the Field
Your salespeople need to know the status of orders, issues, and payments due so they can act accordingly. Your engineering staff can use the data to create a history of issues and activities on customer sites that may help them resolve current issues more quickly. If you provide links to field data, especially ones that people can access on mobile devices, it can be fed back into the main system without staff having to return to the office. As a direct result your data will be far richer and more accurate and it’s likely that invoicing and customer responsiveness will also improve.
Personalize Your Communications
Using recent history that you have collected in your CRM database, you can show you know what is happening to an individual customer and stay on top of any issues proactively, before they get too far out of hand. If a problem is persistently affecting one customer, it may likely be affecting others. Don’t forget that customers are communicating with you all the time, either directly through your field-staff interactions or via your support desk, or indirectly through on-line forums and product comparison web-sites such as Twitter, Craigslist, TripAdvisor and so forth, depending on your industry.
Consider this a starter. Once you have an effective CRM system in place filled with accurate and up-to-date customer information you can use it to keep existing customers happy and turn prospects into likewise happy customers.
Categories: CRM blog
Tags: customer analysis, BI
Author: Richard Minney