I liked this recent blog by the industry analyst Kate Leggett of Forrester focused on how CRM is driving engagement, relationship, and revenue. Of course CRM means Customer Relationship Management and is a system of processes and technologies that have been around for decades now.
However, CRM in the past was notorious for costing a lot and delivering little. Companies would invest millions installing these enormous technology systems that don’t quite match the processes used by the company and eventually the system becomes useless, as the people don’t keep the information up to date.
As Kate Leggett suggests, this is changing, but I believe there is a virtuous circle being created. Modern CRM systems are able to capture so much more data on customer behaviour because much of that information capture has become automated – online retail being a classic example. It’s easy to capture and record a purchase history and data on what the customer liked or looked at for the longest time even if they did not make a purchase.
In turn, this is allowing companies to really use this data on their customers in an intelligent way by enabling them to offer deals and offers that are targeted at single customers – based on their preferences, purchases, and behaviour.
This is creating a better environment for customers. They get an experience with brands that appear to really know and understand their needs, leading to greater satisfaction and loyalty.
The Forrester blog talked about how this improved use of modern CRM drives increased engagement, relationship, and revenue and I believe that this is correct. Because the brand knows their customer better, the experience and relationship is improved. This is more likely to lead to more customer engagement – purchases or just conversation and questions about potential purchases. All of this more targeted interaction with customers is likely to lead to increased revenue.
CRM systems have had a bad reputation in the past, but I believe that with the way that modern customers behave, their time has now come. This improved data analysis really creates better interactions with customers and this boosts revenue.
CRM is no longer about a big technology system; it is a way of thinking about your relationship with customers. How do you ensure that you know enough about your customers to be able to interact with them in a way that they will appreciate? Customer relationship management really is the answer if you want to great a great customer experience today.
Photo by Marc Biarnès licensed under Creative Commons.