Successful Business CRM
Introduction
“The customer is always right “ might be an old age, but it is one that has been at the forefront of successful businesses for many years, and will undoubtedly remain in the future.
Uniform products, along with individualization of customers have brought pressure for change in marketing practices. In the automotive industry, that implies generating additional product benefits by means of communication and services that are designed and delivered to match the individual needs of customers. This is one of the main goals of CRM.
Forging good relationships with its clients is absolutely vital to the success of any organization, and understanding the individual requirements is often the key to ensuring customer satisfaction, securing repeat business and driving up profits.
Business relationships are getting ever-more complex and customers are demanding – and receiving – a faster and better level of service, irrespective of the industry they are operating within.
Everybody understands the importance of putting the customers first
The Genesis Of CRM
To understand the current state of CRM, we must understand its history. The story of consumer relationship management is clearly older than the term itself. Its philosophical roots can be traced in ideas from service management, relationship marketing and the total quality management movement.
Quintessentially, these are all management paradigms that make the customer the focus of any activity that the company sets out of perform. Throughout the 1990s, these philosophies were supported by numerous research findings on the importance of customer satisfaction, loyalty and retention for the long-term success of any consumer service operation. Gradually, more and more organizations gained insight into the strategic imperative of investing in what we now call CRM capabilities.
Why CRM?
Everybody understands the importance of putting the customers first. However, few organizations do really their potential when it comes to delivering the best possible service to their customers. Responding to the results of quality reviews and offering improved membership packages do generate positive feedback, but still there is a feeling that most organizations could be doing a lot better. So why is this?
The key to answering this question is to understand that every customer is different, and has a unique set of requirements. CRM has emerged as a business philosophy which dictates that everything your organization does needs to be focused directly on the strategic objective of delivering a better customer experience. Technology can help you do this, but technology alone is not enough.
CRM Definition
In my opinion, the Customer Relationship Management definition entails the following:
- Know your CUSTOMER, his needs, wants and motives
- Appreciate the length, width and depth of the RELATIONSHIP between the customer and your organization
- Proper MANAGEMENT of all interactions with the customer
Customer Retention
In their zeal to grow, many companies focus almost exclusively on entering new markets, introducing new products, and acquiring new customers. However, these companies often have a “leaky bucket”- as they add new customers, old ones defect from the firm. Some studies report the average retention rate for U.S. companies is about 80%. Roughly speaking, the average company loses the equivalent of its entire customer base in about five years.
Studies also show that the cost of acquisition is generally much higher than the cost of retaining existing customers. Therefore, it seems obvious that a firm should focus on retaining its existing customers. Unfortunately, many companies don’t even know their customer retention or defection rates. Part of this problem lies in the lack of appreciation for the importance of customer retention. Therefore customer relationship plays an important role in any industry.
Consumer Relationship
In simple terms you can map a relationship with a customer as a ‘journey ‘where there are key milestones are as follows
- Targeting
Segment a market using good analysis, planning and data
- Enquiry Management
Effective Businesses set up suitable channel to deal with any questions from prospects
- Welcoming
A visit, phone call or welcome pack is all ways to give customers the necessary information for doing business with you.
- Familiarization
Often companies get to know customers by collecting information in the early days (e.g. through a questionnaire). This can be administered easily through the mail, enabling new buyers to fill out the details in their own time