Beyond The Three-Letter Acronym: Understanding the Business Value of Modern CRM SystemsMarch 29, 2013 No Comments
It’s much more costly today to acquire a new customer than retain an existing one. Maintaining your customer base requires critical insight into their needs, preferences and behavior. It also requires consistently delivering positive experiences that strengthen relationships, encourage recommendations and drives growth across a number of channels and touch points: digital (web, mobile, and social), print, and call center. Modern Customer Relationship Management (CRM) systems actively deliver these results by melding a relationship between the IT side of the house and marketing. And, why not? It’s a shift that only makes sense as traditional CMO and CIO roles continue to evolve and become more customer-focused. If your CRM system is not delivering all of the above, it’s time to move on. It’s no longer effective or efficient.
To understand the present and future, we must look briefly to the past to recognize the inherent differences between modern CRM systems and the infrastructure and culture propagated for years by traditional systems:
- Technology: On-premise, time consuming to implement, requires consistent maintenance and continuous improvement, a considerable capital expenditure
- Volume: Systems require large IT infrastructures, commitment and dedication of resources
- Ownership: IT controls purchase, implementation and management of system
- Model: Offers a one-sided, “inside-out” view of customer relationships. Systems are simply a tool to manage existing customer relationships.
- User Interface: Complicated, non-intuitive, requires extensive training
The dominant message is clear – traditional CRM is an IT-related investment and represents “business as usual.” It offers no effort to promote growth and aids no strategy to help achieve cross-organizational goals. Traditional systems are advocates of the status quo and have no place in a world where optimizing the customer journey is now a major objective of top organizations. In an environment where, “marketing is a never-ending competitive quest for customer retention,” investment in modern tools makes sense. Today, customer service is marketing and vice-versa. While it may appear unlikely from the outside, such fusion actually yields significant results in the form of an increase to the bottom line. Even in uncertain economic times, the use of modern CRM technology to strengthen customer relationships is a key factor in delivering business growth. When it delivers the following, the reasons why are clear:
- Technology: SaaS-based, does not require consistent maintenance and continuous improvement (over 50 percent of implementations will be by 2020)
- Volume: No large implementation commitment required, systems are on-demand and elastic
- Ownership: A top-to-bottom organizational investment, shared management of system optimizes ROI
- Model: A tool to deepen existing customer relationships and acquire new business; emphasis on holistic “outside in” views of the customer and recognizes the need for social integration
- User Interface: User experience drives adoption, collaboration and continuous improvement; intuitive, flexible, allows for mobile capabilities and simplifies processes
Modern CRM promotes cross-organizational collaboration and empowers business users. When removed from the clutches of IT and opened up to sales and marketing via seamless integration, the benefits are irrefutable. CRM is just as much about attitude, awareness and leadership as it is about technology. Placing emphasis on the importance of the customer journey is vital to unlocking the true value CRM technology holds.
In many ways, evolution of the model is as simple as life. Processes are born, blossom and grow old. CRM is not exempt from any of those phases, but its facilitating progression that is imperative to long-term success.
Ray Gerber is Chief Technology Officer at Thunderhead.com where he is charged with delivering innovative technology solutions to market. As an industry leader with 30-years of experience in building technology strategies, his areas of expertise include customer experience technology, business process management, customer relationship management and more.Fresh Ink, SOCIAL BUSINESS