What is CRM and how do I do it?

CRM stands for “Customer Relationship Management” – self explanatory you might say.  But what does it really mean for your business.   Let’s start with a definition, Microsoft defines it as “A strategy that blends people, processes and technology to maximise client acquisition, growth and retention in a profitable way.”  So that would seem to make sense – we all want to achieve that in business, but that’s just lots of nice words that make it sound very grand – but what do you actually need to do?

I don’t believe in lots of fancy phrases that are generally written either by the manufacturers of such products or by consultants looking to over-inflate their own egos and convince you that you need to spend huge amounts of money getting them to explain the complexities of CRM.

The simplest way to think about CRM is having a central repository of all the information that you know about your customers (and your prospects).  What makes many small businesses great is that they often know their customers inside-out which enables them to offer a personalised service.  As companies grow they lose their ability to retain such personal contact with every customer so the need to hold this information electronically becomes necessary.

Why do you need to have all this information about your customers?

As consumers our expectations on those who want to sell to us have increased dramatically.  When we visit a website we expect to be able to select what information we want to see; we expect to be able to subscribe to receive information about only those products that are of interest to us.  The days of mass marketing generic messages to everyone we know have gone; not only is it extremely expensive but you also risk switching off your customers when they receive communication from you that is not relevant to them.

The purpose of having a CRM system is to enable you to profile your customers and get that deeper understanding of what drives their buying behaviour.  By capturing their every interaction with your business, you can quickly identify specific customers who might be interested in a new product or service based on something they bought, or information they requested previously.  CRM is about creating a positive customer experience and making each individual customer feel like you are talking to them personally.

You only have to look at companies like Tesco and Amazon to see the benefits of good CRM.  What they don’t know about us, as their customers, frankly isn’t worth knowing.  Whilst we may be concerned about companies knowing so much about us, we can also not help but appreciate the benefits when we are presented with relevant and timely information.  When you book your holiday online, this information is stored in a central computer and over time that company builds up a picture of what time of year you travel, your preferred destinations and your average budget.  All this information is then used to send you offers on other holidays which they know will be more attractive to you.

Now you might think that this all sounds very grand and very expensive to achieve.  Well yes it is if you want to manage the volume and complexity of customers that Tesco and Amazon are dealing with.   But there are some simple steps that all businesses can take to get up and running with CRM, to enable them to reap the benefits of a more efficient and targeted approach to growing their own business.  There is a huge range of products available to do this from using simple products such as Microsoft Excel and Access databases or Business Contact Manager in Outlook; through to dedicated CRM systems.  Even the dedicated systems are now available in modules off-the-shelf so don’t require huge investment in technical development.

Ten simple things to remember:

1. The objective is to get everything you know about your customers in one place
2. Decide what information you need to capture before you start
3. Appoint an information manager to define and manage your data (that could be you)
4. Choose a suitable application to meet your needs
5. Keep the data clean – this avoids unnecessary cost and embarrassment
6. Get all your staff involved – CRM is the responsibility of everyone in your organisation
7. Use the knowledge you already have about your customers to get you started
8. Back it up – once established, your customer information will become your most valuable asset
9. Keep it simple and beware project creep!
10. Use the data you hold to drive your marketing and communication with your customers

If you get CRM right for your business you will not only improve your customer acquisition and retention (which leads to increased revenue), you will also open up opportunities to cross-sell and up-sell through the delivery of targeted messages to the right people, at the right time, in the right way.

I’ll leave you with a quote from Bill Gates;
“how you gather, manage and use information will determine whether you will win or lose”

Blue Topaz Marketing offers freelance marketing services and has experience in helping businesses define their information management needs and identifying and implementing suitable solutions.  If you need help looking at how your business could benefit from a CRM approach (however small) then visit www.bluetopazmarketing.co.uk