Maximizing Profits for your Company using CRM Properly: Part Three

Remember that the customer is always at the center.

Part Three: Customer at the Center

Disclaimer: The author is not affiliated with any specific entities cited.

Companies should tailor the process of a CRM plan to each customer. Not every customer is going to purchase the product through the same means of communication. For example, a company in need of your product and looking for a partnership with your company will more likely sign that partnership with a personal sales representative. Still, a unique buyer may only need an advertisement online or a single communication through email. Companies should differentiate classes of customers and create a joint plan with customers by directly creating a plan. Suppliers and intermediaries should have open contact with the company to receive a quality product promptly. Communication using established business rules between these parties will maximize consumer happiness and increase their retention.

Data acquisition and improvement is the best method of utilizing technology and retaining customers. Data acquisition on customers should begin even before your first contact with them. The technology you use should work well for collecting information on each customer and with little problems. Utilizing your CRM with data acquired by your software allows the CRM process to express its full potential with a customer, rather than mistakenly implementing it when a sales representative is a few steps into a relationship with a customer. By acquiring data across social media before the initial contact, you have an upper edge on what the customer wants, how they may react to a particular action, and how they may expect you to act.

Once data is collected and the customer is on board (or not on board), you should track everything with the CRM to praise the interaction's strengths and learn and continuously improve. No CRM or plan is perfect and will have an answer for every situation.

However, by tracking data, you must continually improve a CRM. Implementing improvements into a CRM and changing business strategy (as discussed above) puts the customer first and increases the chance of their lasting business with your company. The data may also show that a customer relationship is not profitable to the company and should be improved so that it is beneficial to both the company and customer. Some examples of data that you should track with each customer include (courtesy of Ian Gordon):

· Account management costs

· New product concepts developed in collaboration

· Costs or time saved in new product development

· Savings in new account acquisition from customer referrals

· Costs associated with inventory levels (finished goods works, in process, raw materials, etc.)

· Reduced costs of marketing such as co-marketing

· Reduced infrastructure costs such as from shared investments

· Costs of managing customer communications, customer support, complaints, feedback, and restitution (payments for returns or errors)

· Amortization of infrastructure costs such as call centers and websites

The costs of retaining a customer should never outweigh the profit. While the customer's interaction and happiness should be at the forefront of every CRM, the company can always remember this.

When a customer is not on board with your product, it is an even more excellent learning experience and opportunity for improvement with your CRM. If the customer was within the demographics of a specific customer class and all the CRM strategies were used. The acquired data from the interaction will allow the CRM to prevent unsuccessful customer interactions in the future. It is important to remember that a CRM is a trial and error process and will take a long period before reaching its full potential. However, if the company keeps in mind its customers, employees, easy communication process, and to acquire data for improvement, this time should minimize itself.

Customer retention or acquisition via CRM- which is more important?

Returning customers account for 41% of online revenue and are only make up about 8% of customers. Returning customers are easier to market to and have a much higher conversion rate (conversion rate defined by Nielsen Norman Group: The conversion rate is the percentage of users who take the desired action. The archetypical example of conversion rate is the percentage of website visitors who buy something on the site) than new customers. The one fatal flaw that 40% of companies are currently making, according to Invescpro, and are focusing more on recent customer acquisition than retaining their customers. Customers are more likely to spend more money than five new customers combined when a CRM tends to them.

These companies are not utilizing this opportunity to explore CRMs and retain customers, which is a terrible mistake. While new customer prospecting and acquisition are essential, keeping current customers happy with CRM is more important. Everyone in the industry wants to treat each of their customers the same way, but this is not the treatment that customers wish to a customer that holds a partnership for years with your company wants a different treatment than a new acquisition.

We have not reached the full potential of the right CRM yet. The customer relationship with the company is proven to be more profitable. A structured CRM is the most efficient way to make the customer happy with a company, thus attracting them to prolonged business with said company.

Part One

Part Two