Excellent.org: shows a laptop with a CRM on the screen

Customer Relationship Management – the basis for your good service

Customer Relationship Management – abbreviated CRM. By using CRM, you as a company ensure that you restructure your customer service once again and thus also improve all processes that are related to service. Your relationships and interactions with potential, but also existing customers, are organized and optimized. Internal and external communication, as well as individuality and structured service are the main focus when using a CRM system. Building on and as a continuation of the last blog post about building customer relationships, today’s blog post tells you everything you need to know about customer relationship management and what is actually behind it.

Definition and benefits of a CRM system

If one speaks of a CRM system, this means the administrative activities of customer management. It is a software that manages customer relations – i.e. contact data, addresses and much more. In a nutshell, one could say: „By using a CRM system, customers should be looked after as specifically and comprehensively as possible in order to create long-term and profitable business relationships“ [1].

The CRM is not only a simple tool for database and customer care, but it also supports you in the entire customer, sales and productivity management. All processes related to your customer relationships can be planned, controlled and implemented.

Individuality and a communication on a personal level should be a priority here. It is a fact that customers have more trust in the provider, who gives them the feeling that they are not just a number in a system, but a valued customer, whose needs and opinions are valued. CRM makes this possible, or gives you the basis for building such a relationship with your customers.

Functions of a CRM system

A CRM system offers a wide range of functions that go beyond the collection of contact data. The focus is naturally on the maintenance of master data of individual customers, such as name, address, telephone number and other contact details. Especially important for individual and personal consulting is the storage of contact history, such as mail traffic and telephone history. A document management system offers you as a company the possibility to allocate documents to customers and thus to make the affiliation of data even clearer. With the help of various filters, customer selection can take place more quickly and easily. Here you can filter your customers by turnover, region, industry or other criteria. You can also use the „Task Management“ and „Project Management“ tools to simplify internal organization and ensure teamwork even across multiple locations. A calendar function, including appointment management, ensures that no more customers or partners are lost and you can present yourself as a reliable company.

Advantages of Customer Relationship Management

The Customer Relationship Management supports you in all aspects of customer management. From the initial establishment of new customer relationships to the maintenance of existing contacts, a good CRM system helps you to ensure individual customer satisfaction. This is based on the fact that the system lets you know when you agreed what, with whom, how conversations went or which contact points already existed. This enables you to react faster and more competently to queries and problems and thus leave a lasting and reliable impression. This positive impression will then also be reflected in your customers‘ purchases and follow-up purchases.

The four components of CRM

But there is not only one aspect of CRM. In customer relationship management, different priorities can be set. Which focus you choose should depend on your company size, philosophy, and general business model. Depending on where you position yourself as a company, the CRM system adapts in its conception and thus also the relationship with the customer. You can differentiate between the following different CRM systems:

Operational CRM

Especially companies that still have deficits in their operational work can achieve great success with this. But what does operational mean? With operative CRM, the focus is on maintaining customer history, updating address data and contacting the customer at the optimal time. Thus, basic data is collected, which can be further analyzed from there. Affected departments here are sales, marketing or even customer service. This provides the basis for a daily smooth communication with your customers.  This can be related to the individual customer, about whom you want to get a basic overview, but also include the classification of the entire customer base. Conclusions from the past can be drawn from the operative CRM, but also input for the next steps and contact attempts with the customer can be collected.

Analytical CRM

An entrepreneurial added value and new insights for the further procedure can be drawn from the analytical component of CRM. This uses the data collected in the operational part to draw the appropriate results. As the size of the company increases, so does the need for an analytical approach, which is covered by this component. Accordingly, sales and marketing are mainly controlled using key figures. This is particularly important for large corporations, as with thousands of customers, it is not possible to respond to each individual customer individually. Since analytics is at the forefront here, the CRM systems leave hardly any room for individual consulting. The prerequisite for analytical CRM systems that add value is also a lot of data, because only then can they be analyzed in a representative manner. But because of the collection of data, the actual customer care often takes a back seat. It is therefore important to ensure that the balance between analytics and customer care is maintained.

Collaborative CRM

As the name suggests, the Collaborative CRM system deals with the cooperation between two parties. This can be internal or external, i.e. with possible customers, partners or potential interested parties. However, it also involves cooperation within a company. If the focus is placed on cooperation between different departments, the CRM system can coordinate work processes more effectively and the customer can obtain information more quickly and in a more compact form. A well managed CRM is teamwork. All users access the same data, are up to date on the work of the team members and you can work together on projects and data even when you are not sitting at the same table. The goal of collaborative CRM is thus to increase transparency in the company, to enable faster service through unrestricted access to data and to increase communication within the team.

Communicative CRM

The communication, to which the communicative component of CRM refers, takes place between the company and the customer or interested party. This takes place via all conceivable communication channels, such as e-mail, phone call, Skype call or message. The focus can be on the best possible communication with the customer. It is important to reach the customer via the way from which he or she derives the most benefit or the best possible cooperation between the two parties can take place.

What does the future hold? – Trends in CRM

Social CRM

In this form of customer relationship management, the data from the social networks about a company is selected. Facebook, Twitter, Xing and Co are thus analysed in the form of web monitoring. Here, the specific mention of a company or product is searched for and the context in which it appears in the social media is checked. This in turn allows conclusions to be drawn on questions such as: „Which target group do I address?“, „In which contexts does the name appear most frequently?“ or „What does the company’s social environment look like?

However, help forums, surveys, or the like also open up a new communication channel in the field of social CRM and can ensure that customer loyalty can be established on a completely different level.

Mobile CRM

Since it is not fundamentally clear today that an employee has a fixed and classic workplace in the office, but rather that this can vary from day to day – whether home office or field service – the mobile availability of contact-related data in CRM is becoming increasingly important. This should not only be made possible, but also attractively designed. Employees are thus able to access all data, which means that they are always up to date thanks to collaborative CRM. This means that good service can be offered around the clock even when on the road thanks to mobile availability.

Excellent.org: a woman shows Mobile Customer Relationship Management

xRM

xRM describes the „Any Relationship Management“. In fact, this trend is already taken into account in many CRM systems. Here, it is not only a matter of including communication and data concerning customers, but also of considering communication with all parties that are connected with one’s own company. These are for example: Suppliers, partners, investors, but also fleeting contacts such as press representatives and influencers. The company image thus becomes complete and all communication processes, whether internal or external, can be included in the analysis.

Conclusion

In conclusion, it can be said that customer relationship management is indispensable for effective customer management. It supports you not only in customer service, but also in marketing and sales. Here you plan, control and collect all information concerning a contact in your company. Using various components in CRM, you can also determine what you focus on and thus set priorities in your own CRM. Whether you are just at the beginning of your business career or have already built up a solid customer base – with CRM you strengthen your contacts and your service, which will become essential for a future-oriented company.


 

[1] CentralStationCRM: Was ist CRM? Und was ist ein CRM-System?