The Very Basics of Customer Relationship Management [CRM]

You have probably heard about this term, CRM or Customer Relationship Management. When I was curious to know more about it, I read not less than 15 articles, blog posts and discussed it with friends. I could get a hang of it but believe you me, none could give a comprehensive explanation to be understood by an SME or convince me to evaluate this for personal business. I will try to explain the same so that you get it effortlessly. No jargons promised.

When most people think of ‘technology’, ‘information’ or ‘CRM’, they think about software and complexities to manage the software. Let’s not forget that CRM starts with ‘Customer’.

For any business, small or big, one thinks of getting the numbers through sales. If you dig deep, salesmen job is to acquire and maintain customers, get new and repeat orders, convince customers with customizing offerings according to needs. Nonetheless, your business is doing the same.

What it does?

List down the activities that you perform to get those numbers running on the charts.

You will get some information about a potential customer from some source (like referrals, trade shows, website, etc). This information can be a name, phone number, email address or anything. You note it down in your diary or save it in your mobile phone for ready reference. You may call this ‘a lead’.

Then you would want to call up the lead, fix some meetings, discuss plan of action and would like to convert it to a customer. During the process, if it is a big organization, you may have to contact several people to get the orders and payments (like Sales Manager, accounts or even the business owner). This involves certain meetings, documentation (like invoicing and credit notes), keeping contacts of various people which you may note in your diary or maintain excel sheets to organize your data.

The process usually goes on forever. You would like to make a central record of all this information which you may want to refer each time. Maintaining excel sheets isn’t a good way if you want to maintain relations. Excel sheets might tell you about the transactions but cannot tell what happens before or after that.

This information becomes very useful as your company turns big and relationships grow. The problem arises when the sales team grows bigger and individuals need to coordinate and collaborate information. And it is likely that the business owner (or you) is not the only person who would like to review information all the time.

You would not only like to store it at a safe place but would also like to share it with your sales team. You may want to hide some information as well.

A CRM makes all this, a simpler process for you. Think of your own business, it may not be using a technology, not even excel sheets, but there is a system in place to get the orders, deliveries and get cash inflows.

Is CRM for you?

If you have a business that has 1 to 300 employees, you have sales representatives that constantly look for new customers and keep existing ones satisfied. You may or may not have marketing department but you may generate some activities (sales promotions, trade shows, conferences) as an effort to transform leads into customers. Do you have a way to measure the effectiveness of such efforts and make it better?

For now, imagine a user interface to which you can log in by clicking on an icon on your desktop. You can store all the information and manage detailed intricacies of your business through this. Input all the information through an easy interface just like you enter into your diary, phone or excel sheets. The only difference is that this system is a lot easier and you won’t ever have to turn pages. Consider this as software which you call as “Customer Management”.

CM turns into a CRM when you use this facility to enrich and develop relations with your customer. Your marketing strategies can become a lot easier when you have detailed information about your customers. Segment them on basis of industry, turnover or any of their needs and target an attractive segment in few clicks. Customize offers according to customers’ needs and let your creativity design newer marketing strategies.

CM or CRM?

CM activities were about sales and profits. CRM activities do not revolve around Sales, but Customers. CRM captures information (sometimes automatically) about people who enter your website or come in through other sources like trade shows and referrals. The marketing department can then handover the leads to sales department for follow ups and sales.

CRM also allows you to automate process if you have a system in place. It can remind you to collect orders/payments from customers when required or maintain relations via automatic email shoots.

A Sales manager can allow sales representatives to log in with their unique IDs and make useful information available to them. This way, a manager can see a larger picture and security of leads is maintained among salesmen. Manager can also track the numbers and also review the individual targets.

Happy Customers

Think of this as a way of doing your business and not only a software tool to get maximum sales. Happy customers provide healthy business and hence manage relations not sales; with centralized view of information.

Thats what CRM is all about in a nutshell ! Your thoughts welcome !