CRM is more important now than ever to businesses because it can help you to gain new customers and retain existing ones.
In today’s highly competitive environment and with so many products and services to choose from, customers are picky and customer loyalty seems to be a thing of the past . The moment a new product is introduced into the market, it takes only a few months before that product or service suddenly becomes a commodity .
And let’s not forget the introduction of the Buyer 2.0.
Thirty years ago, when PC’s were a little known thing,
our behavior as consumers was different. We were more
used to receiving information . This came in the form
of TV and magazine ads, we had to talk to many sales
representatives to get information, we gathered brochures and sales materials and then we tried to make sense of it all .
Then, when Web 2.0 and social media arrived, they changed everything . Forums, chats, blogs, discussion groups, price comparisons, scorings, rankings, social networks, professional communities, wikis, and even business web pages offered a lot of information to buyers . Today’s buyers are informed and quite immune to traditional and obvious marketing tactics .
Customers don’t need you to tell them what they need or want anymore. They already know. What they want is to be treated as individuals.
They want to feel like their business matters to you and that you care.
The chart shows
The chart below shows a well-cited study by The Rockefeller Corporation studying precisely why customers leave . Everyone thinks that people leave because of lower priced competitors. If not that, then it’s because of a killer competitive offer. That’s not the case.
68% leaves because…
This study showed that 68% of customers leave
because they feel like you don’t care about them .
Why do customers leave a company?
Customer believes you don’t care about them Customer is dissatisfied with your service Customer is pursuaded to go to a competitor Customer gets a friend to provide a service Customer moves away
68% , 14 % , 9% , 5% ,3%
He who cares wins
Think back to a time when you, yourself, needed customer support from a company . If you called the company and they had no previous information about you, kept trans- ferring you from department to department and you had
to keep repeating your information over and over again
– you’d probably feel like the company didn’t care about you and didn’t value your business .
Now think about the kind of service you get from your favorite airline . For example, when you call that airline, the phone system recognizes you and welcomes you by name . You have the chance to get routed to a live
customer representative and when that person picks up the phone, he/she addresses you by name and already knows all your preferences, your upcoming flight information and any other issues you may be having .
By providing you this kind of service, the airline is giving you a reason to continue doing business with them .
Similarly, if you are investigating a new product, you probably are more likely to buy from the sales person who shows you that he has noted, understood and taken into account your needs and concerns . This shows up in the way he follows up with you, in the direction of the sales calls and in the offer that he makes you.
Needs and concerns
Direction of the sales
A CRM system can make all the difference
in whether or not you gain a new customer or retain an existing one . Customers who feel valued are happy customers and happy customers mean repeat business – not to mention, improved bottom lines .
How does CRM work?
Although some people think of CRM as just a technology, it is so much more than that.
No technology, no matter how sophisticated – can be successful without a strategy to guide its implementation and use . Business strategy and technology must work together in order to bring a customer-centric plan to life.
Supports a customer-centric strategy
A CRM system supports a strategy which says that the customer is at the center of everything that you do . This customer-centric strategy must be based on clear goals and a vision of what a meaningful customer experience looks like .
A valuable customer experience is an integral part of CRM . According to Gartner’s report, “Improving the Customer Experience: Expectations, Delivery and Feedback”:
Every time a customer comes in contact with an organization, through any of its channels, the customer has an opportunity to form an opinion – be it good, bad or indifferent.
Through time, this collective set of customer experiences forms a picture in the customer’s mind, which forms the image of the brand
Organizations which are serious about CRM are serious about designing and maintaining a quality customer experience.
They recognize that a poor customer experience is a step toward customer defection, whereas a good experience encourages loyalty.”
What factors encourage loyalty? In a study done by Customer think corporation, “Customer experience management: The value of the moments of truth”,
there are 4 main factors which contribute to customer loyalty:
Factors in earning loyalty
How important is the quality of each of these activities in earning your loyalty?
Product or service Sales interactions Purchasing process
Service and support
84% , 66% , 62% , 58
Of course, the quality of the actual product or service being purchased is still important, but as you can see in the chart, the quality of sales, purchasing, and service and support activities received a significant percentage (ranging from 58 to 66 percent) of high importance ratings .
The following three examples give you a taste of how a really good customer experience can be:
1 United Airlines saves your seat, books a flight
New York Times best-selling author Steven Levitt wrote an article about how United Airlines turned him into a customer for life in a couple ways . Steven was running late, and unlike other airlines, they actually saved his seat until the last second . On another occasion, United Airlines called him and informed him that his flight was delayed by a few hours, and they saw that he was in the airport . The call went like this:
“I see that you’re at the airport and your flight is delayed a few hours. A seat opened up on an earlier flight, so I grabbed it for you in case you wanted it. It leaves in 40 minutes, so you’ll have to hurry.”
These two events, Levitt explains, turned him into a life-long customer of United Airlines. / Source: Open Forum
2 Zappos believes in the personal touch
Martha A . ordered a pair from the Zappos site, but had PayPal issues . Instead of telling her that it wasn’t a Zappos problem, the Zappos customer service representative (Brandi H .) helped her resolve the credit card issue . When Martha told Brandi that the shoes were for her daughter who was graduating in a week, not only did Brandi wish her daughter “congratulations”, but sent a flower arrangement with a note from Zappos.
Martha says,” I have never had a business be so personal in their dealings with me . I am totally impressed and just wanted to send you a sincere ‘thank you!’ for brightening my day and my daughter’s .” / Source: Zappos
3 Cisco helps customer to help themselves
Cisco tries to make working with their company as easy as possible . Their customer experience program analyzes insights from surveys, social media, and a core employee listening post to identify opportunities to simplify processes and remove customer, partner, and employee pain points . For example, the online customer support website needed some help, so the company streamlined processes and improved navigation to enable customers to solve their problems quickly . The result
is that 81% of issues are now resolved online, which avoids 356,000 cases per month. / Source: Forrester
A part of the value in a specific product or service is the experience that it creates. Once the vision of a valuable customer experience is defined, the CRM software is what will bring it to life. With CRM, you will get to know your customers, to understand their needs and be able to respond to those needs faster and easier .