That may sound like a place somewhere next door to the Twilight Zone, but increasingly, it’s where businesses needs to be to build long lasting engagement with their customers.
Consider this: according to Gallup, engaged customers deliver a 23% bonus in terms of spend, profitability and relationship growth compared to your average customer. McKinsey discovered that 70% of buying experiences hinge on how customers feel they are treated.
And Emmet Murphy noted that just a 2% increase in customer retention has the same effect as reducing costs by 10%. The relationship dimension, it seems, is an essential – and profitable – place to be.
So with that in mind, here are 10 golden rules for developing a CRM strategy that delivers results by helping you operate in the ‘relationship dimension’.
1. Set the direction
Having a state of the art CRM system is not the same as having a CRM strategy. Like any other piece of software, it’s a tool. The most intelligent CRM system can’t hope to deliver the goods without data, the creativity to make communications personal (and sound it) and, crucially, a plan.
So before you embark on any CRM programme, ask yourself this: why? Why do you want CRM? Where do you want it to take the business? How will your business landscape change in a pre and post-CRM world?
With some of those big picture questions addressed, move on to some specifics: how will you apply CRM in your business? Upselling? Engaging cross-platform? Maximising customer value?
These answers matter, because they determine the sort of CRM you need to develop.
2. Start with the customer
There’s a reason CRM starts with a ‘C’. Try to launch a new CRM strategy built around a product or service and it may be many things, but it won’t be CRM.
First, consider the experience you offer your customers:
- Where do you currently intersect with your customers’ lives (a sale, a phone call, a live chat experience etc)?
- How well do each of those touchpoints measure up against your customers’ requirements/expectations?
- What do they value most about you? Where are the gaps that need filling/touchpoints that need revising so that you’re easier to do business with?
Second, consider your business processes, and review what needs to change in order to align the way the business works with the outcomes your customers want. What is it that would make communicating with you/buying from you an easier, seamless, more enjoyable experience?
3. Choose the right customer segments
Understanding what your customers really value about you – and what needs to change – is easier when you don’t treat them like one homogenous lump. Segmenting your customer groups is hardly a new notion, but it may be time to look again at your segments and redefine them from a CRM perspective.
That means more than segmentation by age or location (although both can still be valuable). It means segmentation by behaviour: the high value, the socially active, the lapsed customers and dormant accounts; and segmentation by preference (of room, seat, dress or collar size, for example).
The more tightly you can define your segments the more you can make the personalised communications that lead to long-lasting relationships. And you can’t do any of that without…
Data is critical to CRM. Most companies gather some level of data. Few gather data strategically, and even fewer use it to its fullest potential.
The problem with gathering data willy-nilly is that soon you end up with so much information that it’s impossible to know where to begin in wielding it effectively.
Data may give you the power to understand your customer in infinite detail, but that only holds true if you’ve got someone a) looking at the data you’re collecting and b) capable of turning masses of information into insight that makes a real difference. Without that, it’s the equivalent of taking your supercar out for a spin on the 20mph roads round your local school – all potential, no performance.
So start again. Look at the data you gather and compare it with the data you need. Adjust the former to align with the latter and make insight and analysis a core part of your CRM strategy – so you actually do something will all that information you’re collecting.
5. Break the silo
To be successful, CRM can’t live in a backwater of the marketing department. It has to impact across the business as a strategic function, not a standalone entity.
Often, when we’re asked to look at an organisation’s CRM, we find this is one of the key reasons for the perceived failure of a CRM programme. Because as things move on – as customers expect more, new products are introduced or service standards change, the CRM has to keep pace.
And it can only do that if, from sales to customer service to marketing, everyone is working with the same CRM strategy, updated to reflect the needs of customers now.
6. Comprehensive and consistent
Introducing a new CRM strategy is a big organisational commitment, and there’s certainly nothing wrong with starting small to test the impact of the changes you’re making.
Yet over time, it’s important that your CRM should span all areas of the business, and all the various platforms you’re using to connect with customers. Traditionally, that’s been a case of easier said than done. It’s been a tricky task to remain consistent even in a single channel (eg Web), let alone expanding that consistency to mobile, social, programmatic and more.
But as CRM becomes ever more sophisticated, it is increasingly possible to ensure that the experiences you give your customers at one touchpoint are replicated across all others.
7. Aligning creative
When the CRM informs the creative, the creative delivers more, more personally. That’s hugely important because the physical manifestation of CRM is the sum total of things you do and the conversations you hold with your customers.
That means moving away from template newsletters, social media accounts divorced from the rest of the marketing content, and the sort of “fix it later” copy that fills space but doesn’t do the job you need of it.
When your CRM drives the creative, you may ultimately say less – but you’ll say it in a more targeted way, to people who are more likely to listen.
8. Measurement that means something
It’s one thing to have transformed your direct mail/social media/mobile content as a result of your newly joined up CRM. But in order to know whether it’s working or not – and to be able to demonstrate that the improvements are down to CRM – you need to measure it.
At Amaze One, our Business Intelligence Unit’s prime function is to measure the difference our marketing activity makes to customer behaviour, so we can demonstrate our client’s return on their investment.
You way not wish to stretch to such lengths, but it is important to know what difference your CRM policy is making.
9. It’s a process
CRM is no one-hit wonder. You can’t simply implement it and expect it, like a new door security system or a new batch of water coolers, to go about its business without any further action.
Saying “CRM is a journey” may be painfully hackneyed, but it’s also true. Its success is predicated on the strategy you develop and the way you develop that strategy over time through measurement, through refinements in the way you collect and use data, and through listening to what your customers are telling you.
10. Who’s accountable?
Judith Kincaid said “When everyone is responsible for a program, no-one is accountable. CRM needs a champion.”
So whilst CRM should enjoy a cross-organisational existence, there should be someone at or near the top of that organisation to ensure it receives the advocacy it needs to thrive in the first place, and the attention and drive it needs to support results for the long term.
How do you lock accountability in? We’d advocate making CRM measurements a core part of business KPIs. Because when they’re a part of the measures on which pay and performance is based, CRM enjoys a much higher profile.