Most organizations can talk the talk when it comes to the objectives of customer relationship management. It is widely recognized that the right strategies and solutions bring efficiency and sophistication to customer services, boost customer engagement (and, therefore, loyalty), and ultimately drive company revenues. But are SMEs really achieving optimum returns on investment?
To find out what is happening on the ground, we canvassed 300 small and medium enterprises about the business objectives, and achieved value and benefits, of their CRM solutions – and identified several key areas in which they could make their investments work harder.
The most revealing finding from the first part of our research, looking at overall objectives, is that less than a third of SME respondents are aiming for increased growth from their CRM. Put another way, the majority of organizations are not, as yet, deploying their solutions at this higher strategic level.
This is not to imply that they are they are not gaining substantial benefit from their solutions, but rather that they are at an earlier stage of CRM maturity and are more concerned with the immediate tactical objectives of improving processes and boosting productivity. That is both highly necessary and a valuable starting point to any CRM initiative.
On a practical level, what characterizes the 31 percent of businesses that are prioritizing CRM contribution toward business growth? First and foremost, they are likely to be those that have placed CRM at the heart of their businesses, creating an enterprise-wide repository for customer information that draws together data from all areas of the business and from other adopted systems (such as ERP and accounting software). CRM is the platform from which an organization can effectively and consistently share information across all departments and start to reap significant commercial gain – for instance, by tracking, analyzing, and segmenting their data. In fact, more than half (52 percent) of respondents told us that improved segmentation is a key benefit of CRM.
This figure is somewhat low, which may reflect the common misconception that the value of segmentation is limited to the marketing function. In reality, several business areas can benefit greatly from improved visibility and profiling of data, because it helps to formulate a clearer picture of overall customer profitability. This insight can be usefully applied by customer services, marketing, and product development to ensure that resources are allocated appropriately, in other words toward customers who are likely to contribute the most to the company’s future growth.
The centralized data hub also underpins a company’s ability to deliver informed and timely communications with customers and prospects – via multiple touchpoints. As a recent article in Forbes magazine stated, “Modern consumers expect brands to engage with them long before they have made up their minds to buy.” It is clear that companies that are able to interact with prospects in a considered way – whether through social media, web, or phone – and provide a stand-out experience from the outset, are more likely to convert those prospects into paying customers.
Our research reveals there is significant scope for SMEs to make greater use of various functions within their existing CRM solutions. Only a quarter said they currently use dashboards to view and report on KPIs and other metrics, and fewer than one in 10 is harnessing the power of advanced Excel to delve deeper into their data. This points to a need for software providers to work more closely with their customers – ideally, on a regular basis – to improve technical knowledge and develop skills so that the full potential of the solution can be realized.
Finally, we should emphasize that those companies that are maximizing ROI from CRM are focused on achieving benefits across the whole organization. All departments, from marketing, through to sales, customer service and finance, have access to organized, connected customer information and can play their role in shaping the customer experience.
As we highlighted earlier, today’s customers expect nothing less than value-added interactions with their suppliers, and prospects are less receptive to traditional sales techniques, preferring to do their own research in their own time. It is therefore imperative that all touchpoints within a business can handle the customer journey sensitively and appropriately, drawing upon the intelligence of their CRM solution.
Edited by Erik Linask