You might have heard the term mentioned online or around the office, and typed CRM into Google, to discover that it stands for "customer relationship management". But knowing what’s behind the acronym isn't the same as understanding what it really means for businesses operating in the real world. So to give you a more thorough grounding in the subject, here's a quick dummies' guide to CRM. If you’d like a longer read, check out: What is CRM?
Way back in 1954 management guru Peter Drucker wrote that "the purpose of business is to create and keep a customer". CRM is the strategy you put in place to manage all your company’s relationships and interactions with both customers and potential customers. The term also refers to the systems and processes you use to help you do that. Managed well, CRM has the power to directly improve profitability.
Drucker’s maxim still stands, but the business world has transformed around it. Acquiring and keeping customers has become more complicated and sophisticated since 1954. Back then a business's customer development would generally rely on reputation, footfall, advertising and recommendation. Technology has changed things enormously – these days, company websites and social media are linked to sophisticated backend systems capable of analysing marketing data and extracting patterns that can reveal new insights about your customers.
From telephone and letters in the 1950s and 1960s to the first days of search engines and email in the 90s – all the way up to today’s social media connections and data-driven personalisation, today's businesses are faced with a multitude of ways to find and connect with new customers. The channels we use to connect are multiplying and evolving at a rapid rate.
Fortunately, the CRM industry has kept pace, with online CRM solutions becoming the standard and providing ways to gather and manage the many touch-points you have with your customers so that you’re always communicating effectively.
CRM is all about understanding what you know, and accessing the right information when you need it. Crucially, it’s about contact management – keeping up to date with who’s who within client and prospect organisations, and building them relationships. By focusing on the right people and relationships, you’ll be able to help your customers but also improve your own sales pipeline and sales funnel. From the first time you first make contact with a potential client, you can track the various stages of your interactions with them as they move from awareness to consideration to purchase – and keep them coming back again time after time.