Customer Relationship Management
CRM software solutions have evolved over the past 20 years or so, to a point where there are so many choices on the market that it can be quite over-whelming for someone whose main focus is on running and growing their own business.
The early systems were PC based and market leading packages like Goldmine, ACT! and Maximizer continue to offer very solid solutions. In essence these are packages that you install and run on your PC or laptop with the option to synchronise to your company server computer to consolidate and share data between various members of staff. As the internet has matured there have been a range of new solutions developed that are accesses by a web browser where all the software and data is centrally managed by the provider of the service. The On-premise or On-demand topic is covered in another blog post.
The functionality of CRM systems for entrepreneurs, smaller businesses and SMEs has a number of core elements, although packages differ in the details. There are also some additional functions that may be standard or extra cost. Several packages are available as different level versions, ie. Free, Professional and Enterprise. Upgrading from one to the next as your needs grow is usually straight forward, but worth checking.
Contact Management
This is the first and cornerstone function of a CRM system. It allows you to record key profile information about a person, whether they be a buyer, a customer or a prospect. Then the activity with that person can be recorded, so that a history of letters, phone calls, emails, meetings etc. builds up over time. Future activity can also be scheduled, such as meetings and phone calls. The system will then prompt the user with their to-do tasks at the scheduled time. Contact Management is great for a business to consumer (B2C) or high volume, low value B2B sales model. Most CRM systems now also support the higher value B2B sales model by providing Account Management capability. This is where several individual contacts can be associated with a company, and maybe several companies or divisions associated with a holding company. Identifying the key data you need to hold about people and organisations, their relationship structure and your contact activity types will help you when you start to look for a new CRM system.
Sales Force Automation (SFA)
This second element builds on contact and account management and adds in support for pipeline management. Anticipated sales can be entered; by contact, account, product/service, close date and probability, as the basis of the sales forecasting function. Reports can then be produced to help each sales person and management identify and prioritise where sales effort and support is needed, which products are more likely to sell, whether sales quotas will be achieved, where additional lead generation is needed etc. Identifying your key performance indicators (KPIs) is a good starting point in order to evaluate which CRM system is right for you.
Marketing Automation
The ability to support lead generate is the third core element of CRM systems. Customer and prospect segmentation, based on profile, purchase and activity data is the starting point. This feeds into outbound contact via letter (mail-merge) email, call-centre, etc. when combined with the creative and copy / scripting of the sales messages. Responses are then recorded as the basics of campaign management, and in some cases leads can be allocated to the appropriate salesperson automatically. More advanced systems will move beyond single step broadcast campaigns and support multi-step campaigns tailored to the response of each recipient. For example, a multi-step email campaign may send an awareness email to a target group, about an event or new product, and, depending on whether the email is opened and links clicked then different follow-up emails can be scheduled to be sent at differing times. The objective is a higher conversion ratio and a reduction in sales effort, by focusing on the most interested prospects. Identifying your current and potential lead generation activity and follow-up processes will help when you come to review CRM systems.
Other functions
There are many other functions supported by modern CRM systems which make them a better fit to this or that sector or organisation. These go under a wide range of headings but are mostly derivatives of the core building blocks above. For example you might run a help desk and want specific support for that, or run a partner or affiliate channel, or want sophisticated quotation support, or to be able to access and update data via a PDA or Smart Phone.
Implementation considerations
You should consider whether you absolutely have to have the ability to set-up your exact process in the software, or whether you can adapt your process to fit the software. Also consider what other systems the CRM needs to work with, such as your website, e-commerce platform, your accounting system etc. Ease of implementation, covering set-up/configuration, user training, any data migration and such should be considered, together with futures such as data security, scalability and support.
At the end of the day your choice will depend on many factors, and your assessment of the benefits and the costs associated with each option that you short-list.
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