Barry Ellis is fuming mad. Hes
been waiting over 35 minutes, on his second call, trying to get answers to his questions
from a national prominent airline. "The first time I called, I got into voicemail
jail, press this, press that, so confusing. After 10 minutes I got frustrated and hung up.
No wonder so many people no longer wait to hear the message and immediately press
0." said Barry.
Unfortunately Barrys situation
isnt an isolated one as many of us have experienced the same thing. Friends and
business associates tell me about their experiences that involve banks, cell phone
companies, software companies, government agencies and offices, and a whole lot more.
Companies (generally) are quite good at
attracting new Customers. In fact, cell-phone companies are amongst the best. However, the
key to retaining Customers is based on the Customers perception of how well the
organization continues to provide products & services they want and how well they
respond to queries and problems.
Today there is a both a philosophical and
technological solution to this problem. It is called CRM (Customer Relationship
Marketing). The principles of CRM are well known yet rarely embraced with enthusiasm. In
addition there are some wonderful CRM technological solutions out there, one of my
favourite (for small and medium sized organizations) is SalesLogix. There are others.
The purpose of a CRM system (whether or not
it is supported with technology) is "Zero Defections". Our Customer loyalty
research is very clear, about 2/3rds of every companys Customers are somewhat
ambivalent towards the organization and are prepared to listen to another
As bad as this sounds, Customers dont
really care about you and your services, they only care about their wants and needs.
Though they may, at some point, get to like you they will only do so when you have
demonstrated your ability to care about them. And, consistently deliver on your promises.
With the right CRM design, activities are focused around building a strong bond with
Customers while making every effort to personalize and enhance the relationship.
Actually an effective CRM system starts
from a philosophical basis (then supported by technology). Keep in mind that the
technology employed by CRM does not constitute CRM. Any company that buys a technological
solution without making the needs of Customers a high priority will be disappointed with
the results. Sure the system will have the capabilities to do what it is designed for but
making it work in your organization takes a tremendous amount of work. Work that pays off
in handsome dividends.
Small businesses may not need the
technology, but they do need to put the principles of CRM to work. The time when a
technological solution will be needed become self apparent.
First of all every company should calculate
the value of a Customer. For example, if a Customer typically spends $1,200 per year with
your Company and they are, on average, a Customer for 5 years, then the Customer value is
$6,000.00. A loss of 100 Customers is worth $600,000.00 to the company, scary numbers!
Second, take a hard look at the practices and processes used by both the sales and
customer service teams. Identification of inconsistencies and non-value added activities
would be the priority. Third, calculate the potential increase in revenue if all sales
people and customer contact personnel performed at a consistently high level of
professionalism. Fourth, take a look at the reasons why Customers have left your
organization over the past couple of years. Fifth, talk to your sales and customer service
people. They know what is needed to really build a longer-term relationship with
Once armed with this information
determining what CRM system would work best is so much easier.
Professionals, at all levels of the company
cant care about what they dont know about. Therefore everyone who has any
contact with Customers should have extensive information that they can access about the
Customer and his/her experiences with the company. The right CRM system will facilitate
the sharing of information needed to serve the Customer better.
Customer Relationship Marketing is a movement that is
pushing businesses into seeing Customers as individuals and not as one large marketing
group. It is about building a strong Customer bond that encourages the Customer to
increase their purchase frequency and/or amount of purchase. If you havent embraced
CRM, chances are your competitors have and you may be left behind. The right CRM system
fosters an organizational-wide belief that every Customer contact point should be held
sacred and handled in a personable, efficient and professional manner.
Feel free to use this
article, just give credit where credit is due!
Copyright 1999 © Sid Ridgley