Perspectives about marketing have evolved from the early days to the modern age. We have moved from the production concept, the product concept, the sales concept, the marketing concept to the societal marketing concept.
The focus of marketing is becoming more and more about the customers and how the businesses engage them and establish a relationship with them. Businesses are not just treating their customers as kings; they are treating them as friends.
Business interactions are becoming more personalized.
The Growing Importance of Customer Service
The ability of a business to engage their customer base and establish a good customer relationship is becoming crucial to their success.
Experts like Walker expect that by 2020, customer service and experience will become more important than product and price. Such expectation is justifiable since research by Accenture shows that as a result of poor customer service; $1.6 trillion is lost by business enterprises in the United States.
However, it is not just about what is lost, but also what is gained. Bain and company assert that companies with better customer service can record higher revenue of between 4% and 8%.
Ninety percent of buyers will make purchase decisions on the basis of customer service. No wonder it is five times to twenty five times harder to gain a new customer than to retain an existing one.
No wonder Jeff Bezos, the CEO of Amazon said, “We see our customers as invited guests to a party, and we are the hosts. It’s our job every day to make every important aspect of the customer experience a little bit better.”
Little wonder then why companies like Amazon are growing exponentially.
Building strong customer relationship is an integral part of business success.
What is Customer Relationship Management?
Customer relationship management is a collective term that stands for all the strategies, technologies and efforts a business makes to monitor and manage customer interactions and data to improve their experience with the company’s brand.
According to Sales Force, “A CRM system helps companies stay connected to customers, streamline processes, and improve profitability.”
CRM can be a technology that companies use to record, analyze and report customers’ data from phone calls, emails, business websites, mobile apps and other platforms where customer interaction takes place.
It can also be a strategy that a company uses to improve customer experience and ensure better interactions.
CRM can also be a process that companies explore to manage their relationships with the customers.
All of these are known as customer relationship management solutions.
Whether as technology (customer management software), strategy or process (customer management system), customer relationship management is a significant part of brand management.
The data you get from the technology is essential to formulating strategies, and the strategies will define the process.
The Advantages of Customer Relationship Management
CRM has many advantages that business enterprises can explore.
- Generate data about customer behavior that is essential for customer retention
- Understand where customers are in their buying decision process and activate the strategies that will close the sale
- Get insights into customers that are not completing the sales and make personalized interactions to understand their decision.
- Analyze the performance of sales teams, products, and marketing strategies
- Gain a deeper understanding of the interests and behavior of customers and the factors that drive their buying decisions
- Monitor customer conversations about your brand and create positive communications
- Provides data and information for the sales team, marketing team, and customer service team
- Improves return on investment and business revenue
- Greater interaction between the different departments in the organization
- Increases up-selling and cross-selling potentials.
The Growing Importance of Customer Relationship Management
As businesses recognize the importance of customer service, interaction and engagement, the interest in customer relationship management is exploding.
Regarding technology, CRM software is becoming the biggest software industry in the world. An estimate is that by 2025, the CRM software industry will be worth $80 billion
Ninety-one percent of businesses with more than 11 employees now use CRM software. The success they are having with it is the reason that seventy percent of businesses plan to increase their CRM budget every New Year.
Part of the growth is that cloud-based CRM now constitute 87% of total usage compared to the 12% ten years ago. In consonance with recent trends, mobile CRM is also growing with 48% of CRM users accessing their software from smartphones.
The growth in the CRM market is reflective of the change in emphasis in 21st-century marketing.
The rise of e-commerce means purchases take place massively online. Customers rely on users experience, customer reviews, a brand’s interaction, and engagement to make their decisions.
As a result, customer relationship management is becoming the new normal. Procuring customer relationship management software, formulating customer relationship management strategies and designing processes are now integral to the growth potentials and revenue of any business.
A customer relationship management strategy is a must for every business that takes growth seriously.
The trend is not going to nosedive. As stated above, the industry is expected to grow to $80 billion in 6 years.
Every business that is serious about making waves in the 21st century must begin to make plans for the adoption of CRM as software, strategy, and process.
If you have never been serious about CRM, it is time to take the bull by the horn. Some quick steps to follow:
- Hire a CRM expert (preferably someone specialized in your industry) to do an audit of your business to give you an insight into the type of CRM solutions you need
- Get all your teams (sales, marketing, HR, customer service) aboard in making any CRM related decision
- With the help of the CRM expert, analyze your software options and decide on the best one for your business needs.
- Set up strategies and processes to turn the data from software into actionable solutions
- Measure the impact of CRM on your business using metrics like customer retention, revenue, customer satisfaction, etc.
Given the current trends, a business that is already implementing CRM may consider some suggestions.
- Implement a cloud-based CRM where employees can gain access anywhere on any device
- Pay careful attention to Mobile CRM
- Implement more integrations that allow data to be useful across the board
- Evaluate your CRM solutions to be sure they are really working and not in need of improvements. Read these ten signs your CRM system needs an overhaul
The continued interest in customer service will not abate.
A crucial step to that is the implementation of a good CRM system that includes CRM technology, strategies, and processes. The importance of customer relationship management cannot be over-emphasized.
CRM is essential for customer retention, customer interaction, and engagement, increasing revenue and growing a business.
Business owners must make it a priority to implement or improve their CRM systems for maximum business growth and success.