Importance of Customer Relationship Management (CRM)

Importance of Customer Relationship Management (CRM)

Anyone who has taken a business course has probably seen the acronym CRM. CRM stands for Customer Relationship Management and refers to ways of keeping track of interactions with customers.  However, it is much more than that.  Bain.com does a nice job of defining CRM:  “Customer Relationship Management (CRM) is a process companies use to understand their customer groups and respond quickly—and at times, instantly—to shifting customer desires. CRM technology allows firms to collect and manage large amounts of customer data and then carry out strategies based on that information. Data collected through focused CRM initiatives help firms solve specific problems throughout their customer relationship cycle—the chain of activities from the initial targeting of customers to efforts to win them back for more. CRM data also provide companies with important new insights into customers’ needs and behaviors, allowing them to tailor products to targeted customer segments. Information gathered through CRM programs often generates solutions to problems outside a company’s marketing functions, such as supply chain management and new product development.”

Forward-thinking companies must learn to embrace CRM to remain competitive.  An article in BusinessBalls.com pointed out, “The ultimate purpose of CRM, like any organizational initiative, is to increase profit. In the case of CRM this is achieved mainly by providing a better service to your customers than your competitors. CRM not only improves the service to customers though; a good CRM capability will also reduce costs, wastage, and complaints.”

In the business world, Pareto’s Principle is often cited.   This principle states that 80% of effects come from 20% of the causes.   This has been translated to:  companies obtain 80% of their business from 20% of their clients.   As the BusinessBalls.com article pointed out this also means:

  • 20% of customers account for 80% of your turnover
  • 20% of customers account for 80% of your profits
  • 20% of customers account for 80% of your service and supply problems

In order to avoid wasting time and energy, relationship building is critical.  To develop these relationships, it is important to have a strong CRM system.  There are plenty of web-based CRMs.  A popular cloud-based CRM is available through Salesforce.com.  This popular system boasts ease of use stating, “Using Salesforce CRM is as easy as buying a book on Amazon.com. That means your employees will actually use it, so it will be a more effective tool for your business.”

Apps are popping up all over to help with CRM.  Salesforce.com has their own that is good for a sales-based industry.  SmallBusinessTrends.com did a nice review of some other top CRM apps that are useful for small businesses.

Are You Monitoring Your Online Reputation?

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Individuals and companies need to keep track of their online reputation. Do you know who is writing about you or your business? In my book, How to Reinvent Your Career, I mention the importance of having a clean reputation online in case employers do some research into your background. That is important for employees, but organizations must be sure their reputations are intact as well.

One bad comment out there can cause a lot of damage. It is not just negative comments that can hurt you. I have heard stories about companies who have had their information translated incorrectly in other countries which has led to their business looking badly. Don’t assume that something posted in another country can’t be translated back into English and hurt you here.

There are sites like PissedConsumer.com or Scam.com or other sites where your reputation can be ruined.

Sites like Facebook, Twitter, Yelp and others are very important to help spread your positive message. But be careful, because they can just as easily spread a negative one.

I like to use Google Alerts to set up searches to track who is posting things about me or my company. I think it can be very helpful and it is free. If your company is large though, it can be harder to track all of the keywords.

Another free option is Yext Rep. This site tracks mentions and reviews on sites like Twitter, Facebook, Yelp, Superpages and Foursquare.

If you are willing to pay a fee, Viralheat can monitor online conversations for a cost as little as $10/month.

Trackur is another option that many use. They offer powerful tools, you can be up, and running in 60 seconds with their service, monitoring keywords, tracking trends on the web, and discovering how influential your site really is. They have something called sentiment tracking that, “you can tag discovered items with a positive, negative, or neutral sentiment. Keep track of who’s saying positive things about you and who’s attacking your reputation.” The price for this starts as low as $18/month for their basic plan.

Visible Technologies is a good option if you need monitoring in different languages. They support 12 languages and allow employees to share reports. This comes at a cost of $500/month and up.

Radian6 allows you to manage your social media campaigns. It can be integrated with Salesforce.com, Webtrends and Omniture for $600/month and up.