Defining the Customer When defining the customer in Customer Relationship Management, the first thought is usually that the customer is simply the end user of the products, when in fact; CRM’s customers can be suppliers, partners, investors, employees, and other people or entities the firm may deal with. As a firm, it is important to know who your customer’s are. In order to do this, the company will need to collect information each time a customer makes a purchase or when they come across relevant information about the customer.
With this nformation, the firm can use this to track purchasing patterns, which will lead to the identification of the few largest buyers. With this knowledge of the consumer, the firms can distinguish where most of their business originates; thereby applying the 80/20 rule to their customers. This rule states that 80% of your business will come from 20% of your customers. Therefore, maintaining customer relationships with major buyers will help the company in the long run. Investors in the firm will need to know specific information that relates to the performance Of the company.
Having access to this data is necessary to make informed decisions about investing in the company. By providing these records to the investors over a common data source, such as the company website, means that every investor will get the same information at the same time. This provides another benefit as well. It allows the investors to look at the information they need without taking up valuable employee time. Suppliers and partners can be kept informed through CRM systems by offering them product promotions, press releases and informing them of advertising campaigns. CRM System Issues
Although CRM systems are very advanced, can offer enormous amounts of information at a click of a button, and are currently being used by the 70 percent of the fortune 100 countries, the systems still need to be improved. Some of the issues that have been identified by managers are: keeping track of service complaints, and customer satisfaction level. Keeping customers happy should be very important to the company. Firms must understand that it is less expensive to retain a customer than to find a new one. Therefore, firms should aim to meet or exceed the customer’s expectations when roviding them with support.
The company wants to ensure that their current customers are satisfied so they become loyal to the company and are repeat purchasers in the future. Furthermore, they want their customers to provide positive word of mouth to future potential customers. Common Mistakes When Implementing CRM Systems When implementing CRM systems there are many cornrnon mistakes that companies make which include, but are not limited to, attempting to implement the system on too large a scale, lack of a sales process, and not maintaining the database.
A firm looking to implement a CRM system may ant to roll out something that involves every single aspect of the business. While it is understandable why companies may try to do everything at once in order to get all of the headaches over with in one shot, this approach may not be the best solution for many firms. When a firm decides that using a CRM system is appropriate for their company, they are better off to have a much narrower scope of the system they are trying to implement. Therefore, companies should focus on smaller, but relatable activities within their company , such as customer and supplier information.
Even before implementation of a CRM system, the company should develop a sales process so there are commonalities across the board when making a sale in order to better forecast. This mitigates the risk for buyers and sellers, and it also achieves standardized customer interaction in sale. A sales process can include such steps as qualifying prospects, proposal, closing, and deal transactions. Each step can be standardized with clearly defined milestones describing each stage, which will result in accurate forecasts.
Finally, maintaining the database is crucial to the success of the system. This will help to avoid inconsistencies in the systems information. For example, writing I. B. M, instead of IBM, or Incorporated instead of Inc. By eliminating theses inconsistencies along the way, the firm will save time in the end when looking to send out that mailing list at the end of the year. Example of the Use of CRM Systems As noted, CRM systems are used in a variety of ways. In hotel chains, CRM systems are commonly used to gather as much information on their guests and their preferences as possible.