Customer Management: SME tips
Understanding Customer Management
Organizations increasingly focus on adopting customer-centric strategies to understand the need of customers and build a sustainable customer base to grow in the market. Managing customers has become a core business strategy for companies and enterprises in a highly competitive business landscape.
Customer management concept encompasses all the systems, processes and applications that are essential in managing customer relationship. These systems capture, research and analyze customer behavior and record customer’s preferences and pattern. Companies increasingly need systems to gain in-depth insights into customer behavior, buying preferences and demographics.
Customer Management Software
Probably, nothing has transformed business processes more than the evolution of technology and its impact on the growth of businesses. Customer management software—including systems and applications—offer integrated and powerful approach in managing relationships by focusing on customer retention and relationship development. These systems and applications form vital part of what is known as Customer Relationship Management (CRM). A simple way of defining CRM can be an integration of information technology and relationship marketing. CRM software as a critical business initiative by companies has emerged in such a way that it is gaining prominence across major functional areas such as customer support and services, sales, and marketing. In the most profound sense, customer management system is all about managing customer knowledge, better understanding their profile and serving them better.
Ways To Measure Customer Management: What Companies Need To Keep In Mind?
The benefits a customer relationship management program offers an enterprise are myriad; so are the ways of measuring its potential impact on the organization’s goal and bottom line. Companies implement a customer management system to achieve several purposes: higher customer retention and revenue generation, personalized and customized services to a specific group of customers and maximizing sales and revenue. Companies increasingly use it to foster marketing communications across stakeholders and enhance the quality of fulfilment of their offerings. Having said that, it should be comparatively easier to identify the metrics of a CRM project. Consequently enterprises determine the success rate of customer management program once they know what they are trying to achieve.
However, many CRM program are perceived to be falling short of fulfilling the intended objectives for enterprises. As analyst confer one of the key constraints companies face while determining the metrics of a CRM program is the lack of strategy.
As Bill Band, VP and principal analyst at Forrester Research in the report titled ‘Define the Right Metrics for Tracking CRM Success”, states:
“it’s not that metrics are so important in and of themselves, but usually the companies haven’t thought through metrics around customer-facing initiatives, and often it speaks that they don’t have a strategy”.
This makes the task of monitoring and managing performance of a customer management program even more crucial for companies who intend to achieve significant competitive benefits.
Key CRM Metrics
Some of the conventional operational metrics are intrinsically related to the functioning of the three core departments of an enterprise: sales, marketing, and services. Over recent years, key metrics of a CRM program that have come to be associated with growth-oriented companies are business performance metrics, user-adoption metrics and customer perception metrics. Business performance metrics include the outcomes of a pipeline, up-sell, cross-sell, sales, marketing and service. While user adoption metrics includes tracking the way CRM solution forms a part of the organizational strategy. Customer perception metrics mainly includes effective management of customers’ satisfaction and their positive experience about the company’s offerings.
CRM Software For Better SME Customer Management
Some of the ways CRM helps transform small and medium-sized enterprises can be summed up in its potential benefits.
- Do you know your customer well? One of the major implementation benefits of a customer management system for a SME is knowing your customers. It helps the SMEs in a more systematic acquisition, collection, analysis of customers’ information. As a result, companies can offer personalized and customized services to a specific group of customers, such as the top tier customers.
- Enhance the customer lifetime value: SMEs need to be in constant touch with their customers to build up a long-term sustainable relationship. The CRM implementation helps them to integrate all the required customer information with end-to-end business processes across the enterprise.
- CRM implementation to predict future customers’ behavior: CRM helps SMEs to keep a close tab on consumer metrics and analyze them under a wide spectrum of situations to better understand customer behavior and preferences. Furthermore, using CRM tools, SMEs can maximize sales and revenue that would result in increased business potential.
Tips for Successful SME CRM Implementation
Among the various reasons put forth by business analysts that inhibit SMEs to implement a CRM project, the dominant reason is the lack of top management support.
According to a report by Gartner:
55% of all CRM projects undertaken by SMEs fail, and the prime reason being lack of understanding about CRM technologies among owners and employees.
So, is there a definite way to implement a CRM System for SMEs? Cost-effectiveness in CRM implementation is a key factor that merits attention by owners of SMEs. Furthermore, the companies must embark on a significant change in its organizational strategy.
The enterprises need to initially start with an operational CRM and improve later with analytical and collaborative modules of CRM. In the process, they should garner top management’s support, ensure sufficient cash flow in various phases, augment technical expertise of the employees and involve all stakeholders across the stages of its implementation.