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5 Reasons Why Your Business Needs CRM
Despite lots of publicity from suppliers and positive comments from independent observers such as ourselves many
people are still put off by the “techie connotations” of the term CRM (Customer Relationship Management) and its reputation for complexity and don’t believe it could help them.
Steve Orriss, Director and Lead Consultant at the National B2B Centre and CRM expert, examines just a few of the business issues that small businesses face and how CRM could help.
Interest among our small and medium sized clients about CRM systems has never been greater. It’s a combination of everybody trying to squeeze every last drop of efficiency out the organisation and the increased availability of low-cost CRM tools from Cloud based providers.
Our perspective is, though, that CRM is talked about too much from a technical perspective that over-emphasises functionality over business benefits. What this article seeks to do is highlight some of the real problems that small and medium businesses face and provide an understanding of how a CRM system would resolve those issues.
Customer data held in disparate places
For many businesses important, valuable information about customers ends up being held in a variety of places in a variety of formats – Excel spreadsheets, accounting systems, Outlook, Filofax etc.
Not having a single source of data leads to wasted time trying to piece together a complete view from different systems. In the short term people find workarounds that allow them to cope with this. For growing companies, though, as new staff come on board the training overhead is increased and eventually the workarounds just don’t work anymore.
CRM is about creating a single view of the customer that everybody in the organisation can see and which they can all, potentially, update based on each interaction they have.
Ineffective Marketing Campaigns
Not having all of your data in one place is a very obvious obstacle to implementing successful email, telephone or mail based marketing campaigns. It won’t help either that this situation always leads to inaccurate or duplicated customer information –increasing your operational costs and irritating the recipients.
What CRM systems bring is the ability to truly manage marketing campaigns.
Importantly they provide facilities to group your client and prospect lists into specific target segments based on factors such as;
- Previous purchases
- Demographics etc.
The segmentation process makes it much easier to define specific messages for specific target market sectors. For those of you still blasting out the same material to everybody on your marketing list this could be a decisive step in improving campaign effectiveness.
You’ll also be able to track what happens during the campaign and take decisions based on this information. A poor response to telephone calls in one geographical area might mean changes are made to a script or perhaps a particular operator is struggling to make appointments and needs some further training.
Sales Pipeline Problems
For many small businesses the idea that the sales process is anything more than making the best product and then selling it to first person that offers you a “decent” price can come as a shock.
The concept of the Sales Pipeline is that a sale consists of a series of steps (usually defined as 8 or 9) starting with an initial contact, working various stages of understanding client needs and negotiation, and finishing with a completed transaction. Importantly the different stages take different amounts of time and effort to complete and prospects may drop-out of the pipeline at anytime.
Companies that don’t have this concept in mind often face some major issues. The first problem is that they have no sense of whether they are pursuing enough sales opportunities to deliver the amount of orders they need to stay in business. Secondly they can’t accurately forecast resource or raw material requirements, which mean that they might either have excess stock or insufficient people to fulfil orders. A third problem often occurs in growing businesses taking on a new sales team member and realising it is not possible to measure their contribution.
CRM systems provide the functionality that allows the sales pipeline process to be embedded in an organisation and the tracking mechanisms, which allow the pipeline to managed and measured on a daily basis.
Lost Revenue Opportunities
Each new customer engagement provides the chance to cross-sell (buy additional complementary products) or upsell (buy a more expensive product). When your product portfolio is limited this process may be relatively easy. As the portfolio expands and selling is devolved to less experienced staff then more guidance is required.
Equally each new lead or prospect into the business needs to be followed up by the right people, with the right information at their finger tips, to ensure they are converted into new customers.
CRM is about providing your staff with a structured approach to client interactions. This is partly about providing a process for people to follow and also linking the process to the needs of specific clients.
So ultimately it is possible to provide some form of customised script that allows staff to make specifically focused offers to customers based on previous purchases and requests or feedback that have been made in the past.
Wasting Customer Feedback
For many small businesses there often simply isn’t a convenient place to record different forms of customer feedback. An angry customer phone call might generate a conversation round the office but what about more subtle feedback? For instance, clients are asking if a particular change could be made to a service (an improvement opportunity) or spotting an increase in product returns (lost revenue and increased costs).
What CRM systems allow you to do is firstly capture important information from clients but also to do something with it. Firstly share the information to relevant people in the organisation through, say, alerts and reports. Secondly build in the lessons of the feedback into an improved process so that mistakes don’t get continually repeated.
This is just a high level perspective on the business benefits of CRM. What we find interesting is that with every implementation that we have been involved with there are always a range of additional benefits, both intended and accidental.
The benefits stem from the control that companies suddenly have over the way they operate and their ability to see things that were not previously visible. Things like which customers are actually profitable or which staff are the most productive.
source by : www.nb2bc.co.uk