Customer relationship management
While some companies report great success, initiatives have also been known to fail—mainly owing to poor planning, a mismatch between software tools and company needs, roadblocks to collaboration between departments, and a lack of workforce buy-in and adoption. Previously these tools were generally limited to contact management: monitoring and recording interactions and communications with customers. As social media isn’t moderated or censored, individuals can say anything they want about a company or brand, whether pro or con. Increasingly, companies are looking to gain access to these conversations and take part in the dialogue.More than a few systems are now integrating to social networking sites. In contrast with conventional on-premises software, cloud-computing applications are sold by subscription, accessed via a secure Internet connection, and displayed on a Web browser.
This evaluation is critical to determine the level of effort needed to integrate this data. Equally critical is the human aspect of the implementation. They also generally include opportunity management for tracking sales pipelines plus added functionality for marketing and customer service. As with larger enterprises, small businesses are finding value in online management solutions, especially for mobile and telecommuting workers. Social media sites like Twitter and Facebook are greatly amplifying the customer voice in the marketplace, and are predicted to have profound and far-reaching effects on the ways companies manage their customer relationships.
Companies can also leverage customers’ stated habits and preferences to personalize and even “hyper-target” their sales and marketing communications. Some analysts take the view that business-to-business marketers should proceed cautiously when weaving social media into their business processes. Companies don’t incur the initial capital expense of purchasing software; neither must they buy and maintain IT hardware to run it on.
It involves using technology to organize, automate, and synchronize business processes—principally sales related activities, but also those for marketing, customer service, and technical support. Software solutions then expanded to embrace deal tracking and the management of accounts, territories, opportunities, and—at the managerial level—the sales pipeline itself.
This includes policies and processes, front-of-house customer service, employee training, marketing, systems and information management. An executive sponsor should also be obtained to provide high-level management representation of the CRM project. An effective tool for identifying technical and human factors before beginning a CRM project is a pre-implementation checklist.
At the heart of SFA is a contact management system for tracking and recording every stage in the sales process for each prospective customer, from initial contact to final disposition. This finds expression in the concept of collaborative customer relationship management, which uses technology to build bridges between departments.
Social media promoters cite a number of business advantages, such as using online communities as a source of high-quality leads and a vehicle for crowd sourcing solutions to customer-support problems. For these and other reasons, the SaaS option has proven very attractive, and SaaS applications have garnered a large share of the market.
Prominent on-premises vendors include Oracle Corporation, SAP AG, and Amdocs. In 2009, SaaS represented approximately 20% of all customer relationship management spending, and continued its trajectory of outselling on-premises software by a ratio of 3-to-1. As its name implies, a sales force automation (SFA) system provides an array of capabilities to streamline all phases of the sales process, minimizing the time that reps need to spend on manual data entry and administration. Newly-emerged priorities are modules for Web 2.0 e-commerce and pricing management. Systems for marketing (also known as marketing automation) help the enterprise identify and target its best customers and generate qualified leads for the sales team.
This pre-planning involves a technical evaluation of the data available and the technology employed in existing systems. When an implementation is effective, people, processes, and technology work in synergy to develop and strengthen relationships, increase profitability, and reduce operational costs. Customer relationship management tools have been shown to help companies attain these objectives: Tools and workflows can be complex to implement, especially for large enterprises.
A successful implementation requires an understanding of the expectations and needs of the stakeholders involved. Similarly, demand generation strategies need to marry marketing programs with structured sales processes Owing to these and related factors, many of the top-rated and most popular products come as integrated suites. Despite all this, many companies are still not fully leveraging these tools and services to align marketing, sales, and service to best serve the enterprise and its customers.
Many commercial CRM software packages provide features that serve the sales, marketing, event management, project management, and finance industries. From this perspective, CRM has for some time been seen to play an important role in many sales process engineering efforts. Many CRM project failures are also related to data quality and availability. A key marketing capability is managing and measuring multichannel campaigns, including email, search, social media, and direct mail.
If a company s CRM strategy is to track life-cycle revenues, costs, margins, and interactions between individual customers, this must be reflected in all business processes. This is because customers are using these social media sites to share opinions and experiences on companies, products, and services.
However, as mentioned above, CRM is not just a technology but rather a comprehensive, customer-centric approach to an organization s philosophy of dealing with its customers. Next came the advent of tools for other customer-facing business functions, as described below. Perhaps the most notable recent trend has been the growth of tools delivered via the Web, also known as cloud computing and software as a service (SaaS).
Many SFA applications also include features for opportunity management, territory management, sales forecasting and pipeline, workflow automation, quote generation, and product knowledge. Hence, it is important that any CRM implementation considerations stretch beyond technology toward the broader organizational requirements. The objectives of a CRM strategy must consider a company’s specific situation and its customers needs and expectations.
Metrics monitored include clicks, responses, leads, deals, and revenue. Marketing automation also encompasses capabilities for managing customer loyalty, lists, collateral, and internal marketing resources. As marketing departments are increasingly obliged to demonstrate revenue impact, today’s systems typically include performance management features for measuring the ROI of campaigns. Recognizing that customer service is an important differentiator, organizations are increasingly turning to technology platforms to help them improve their customers’ experience while increasing efficiency and keeping a lid on costs. The core for customer service has been and still is comprehensive call center management, including such features as intelligent call routing, computer telephone integration (CTI), and escalation capabilities.
The objective is sharing and harnessing information from all quarters to improve the quality of customer service, and increase customer satisfaction and loyalty as a result. For example, feedback from a technical support center can enlighten marketers about specific services and product features customers are asking for. According to Forrester Research, spending on customer relationship management is expected to top $11 billion annually by 2010, as enterprises seek to grow top-line revenues, improve the customer experience, and boost the productivity of customer-facing staff. Once simply a label for a category of software tools, CRM has matured and broadened as a concept over the years.
Customer relationship management (CRM) is a broadly recognized, widely-implemented strategy for managing and nurturing a company’s interactions with customers and sales prospects. Data from other systems can be transferred to CRM systems using appropriate interfaces. Because of the company-wide size and scope of many CRM implementations, significant pre-planning is essential for smooth roll-out.
Today, customer relationship management generally denotes a company-wide business strategy embracing all customer-facing departments and even beyond. Information gained through CRM initiatives can support the development of marketing strategy by developing the organization s knowledge in areas such as identifying customer segments, improving customer retention, improving product offerings (by better understanding customer needs), and by identifying the organization s most profitable customers. CRM strategies can vary in size, complexity, and scope.
Traditionally, inter-departmental interaction and collaboration have been infrequent and rivalries not uncommon. More recently, the development and adoption of the tools and services has fostered greater fluidity and cooperation among sales, customer service, and marketing. These features can be complemented and augmented with links to separate, purpose-built applications for analytics and business intelligence. Sales analytics let companies monitor and understand customer actions and preferences, through sales forecasting, data quality management, and dashboards that graphically display key performance indicators (KPIs). Marketing applications generally come with predictive analytics to improve customer segmentation and targeting, and features for measuring the effectiveness of online, offline, and search marketing campaign Marketing and finance personnel also use analytics to assess the value of multi-faceted programs as a whole. Customer service analytics are increasing in popularity as companies demand greater visibility into the performance of call centers and other support channels, in order to correct problems before they affect customer satisfaction levels.
A checklist can help ensure any potential problems are identified early in the process. One of the primary functions of CRM software is to collect information about customers. In fact, today’s profusion of customer service channels has prompted many companies to deploy integrated support applications that deliver knowledge-enabled solutions across all of them. Another key trend is the increasing popularity of SaaS platforms for customer service, owing to their rapid deployment, low initial cost, and now-established efficacy for large and complex contact centers. Relevant analytics capabilities are often interwoven into applications for sales, marketing, and customer service.
Support-focused applications typically include dashboards similar to those for sales, plus capabilities to measure and analyze response times, service quality, agent performance, and the frequency of various customer issues. Departments within enterprises—especially large enterprises—tend to function in their own little worlds. The overall goals are to find, attract, and win new customers, nurture and retain those the company already has, entice former customers back into the fold, and reduce the costs of marketing and customer service.
More recently, e-service capabilities—Web self-service, knowledge management, email response management, Web chat, collaborative browsing and virtual assistants—are gaining in importance. These observers recommend careful market research to determine if and where the phenomenon can provide measurable benefits for customer interactions, sales, and support. Several CRM software packages are available, and they vary in their approach to CRM.
This allows them to successfully pursue more customers in a shorter amount of time than would otherwise be possible. Some customers prefer assurances that their data will not be shared with third parties without their prior consent and that safeguards are in place to prevent illegal access by third parties. The following table lists the top CRM software vendors in 2006-2008 (figures in millions of US dollars) published in Gartner studies. The following table lists of the top software vendors for CRM projects completed in 2006 using external consultants and system integrators, according to a 2007 Gartner study. A 2007 Datamonitor report lists Oracle (including Siebel) and SAP as the top CRM vendors, with Chordiant, Infor, and SalesForce.com as significant, smaller vendors. .
Often, implementations are fragmented; isolated initiatives by individual departments to address their own needs. However, other CRM strategies can cover customer interaction across the entire organization.
When gathering data as part of a CRM solution, a company must consider the desire for customer privacy and data security, as well as the legislative and cultural norms. They are currently its fastest-growing segment. CRM technology has been, and still is, offered as on-premises software that companies purchase and run on their own IT infrastructure.
Data must be extracted from multiple sources (e.g., departmental/divisional databases such as sales, manufacturing, supply chain, logistics, finance, service etc.), which requires an integrated, comprehensive system in place with well-defined structures and high data quality. Systems that start disunited usually stay that way: Siloed thinking and decision processes frequently lead to separate and incompatible systems, an incomplete customer view, and dysfunctional processes. Basic customer management can be accomplished by a contact management system, an integrated solution that lets organizations and individuals efficiently track and record customer and supplier interactions, including emails, documents, jobs, faxes, scheduling, and more. This kind of solution is gaining traction with even very small businesses, thanks to the ease and time savings of handling customer contact through a centralized application rather than several different pieces of software, each with its own data collection system. In contrast with contact managers, bona fide customer relationship management tools usually focus on accounts rather than individual contacts.
Data cleaning is a major issue. Some companies consider a CRM strategy only to focus on the management of a team of salespeople.
