It is a fact that keeping an existing customer is cheaper by five times than gaining a new one. Ensure that you have customers who make repeat purchases and are loyal to your brand/ products/ services. But how do you ensure customer loyalty and ensure that you are retaining your best buyers?
The key to having customer loyalty and better customer retention is CRM software solution with CRM strategy.
CRM stands for Customer Relationship Management that helps a business develop strategic processes that win customer loyalty and improve customer experience.
CRM Model:
- Service
- Support
- Orders
- Sales
- Strategy
- Analysis
- Marketing
The customer relationship management and strategy is a foundational strategy company has to use to grow and develop a customer-centric culture that focuses on managing and optimizing current and future customer relationships.
Companies that have specialized CRM like retail CRM helps businesses to analyze data and information such as contact, customer profile, and history of customer’s history with the company for the improvement of customer experience, thus leading to an increase in customer retention and revenues.
The CRM is based on a deep understanding of customers as individuals and collective. CRM helps to anticipate customers’ needs and wants. It helps to exceed expectations and deliver value. CRM helps the company to get the edge over its competitors.
CRM software is a technology solution that helps the company manage customer relationships and enable CRM strategies.
Customer relationship management platforms keep an organization’s sales departments informed and efficient, which are essential for staying competitive no matter what size of the business you are running. CRM is vital for all scales of businesses. Large Businesses have CRM, but now CRM has become more common in small businesses as well. It has prominence for microbusinesses and start-ups.
Sale is always dependent on good customer relations. Then eventually, you would want to have CRM.
Table of Contents
Purpose of CRM:
What is the goal of every business? Why do entrepreneurs do business? The answer is the pretty simple goal of every business is to generate profit from its services or products. And to achieve that goal purpose of CRM is to optimize the relationship between the company and strategically significant customers so that the company can maximize profits and build long-term growth, development, and success.
Strategically significant customers are the most valuable buyers of the company’s products and services. The Strategically significant customers make 20% of the customer base, but they generate 78% of the revenue. As these customers generate more revenue, they become important for business strategy. It is important thus to ensure customers feel valued. The company wants to make certain the customers have customer loyalty and thus repeated buying.
Customers have to be a key focus for the company. To capitalize on customer segments, companies improve long-term profitability and get an edge in competitiveness.
The CRM is a funnel for customer interactions:
CRM is like a sponge that soaks all information about the customers. Retail CRM helps with data organization about customers. It centralizes data and gives access to an easy-to-use dashboard to easily access data in sales, marketing, and customer support teams.
CRM is not some plug-and-play thing. Just buying CRM software will not get your purpose solved. CRM has to be planned, a lot of integration work is to be done, follow CRM strategy along with business strategies and goals to get excellent results.
When you use CRM to its full potential, it combines customer interactions and customer-related data like marketing, inventory, accounting, and purchasing to give insights and metrics that will help you to reach new opportunities quickly.
For example: if the help desk rep realizes that the customer is suitable for upsell opportunities while addressing support concerns, this update doesn’t get lost in email. The data is automatically shared as it gets added to the customer’s CRM record and its places in the pipeline so that sales reps can take advantage of this opportunity.
CRM automated the data in and out of the system across various channels. The automation capabilities result in fast dissemination and quick intake by sales teams.
Automation of data organized data and information and accessibility reduced redundant errors. No inaccurate data. Manually entering data of every customer fails CRM
implementation.
The automated data gathering in CRM and relative apps integrations gives you data assurance. You will build a funnel at one end and grab as much data you can. Funnel parsed into useful units and aimed directly at people who need it.
CRM extends into email marketing, meeting, invoicing, sales calls, contact management, contract management, closing deals, and automating day-to-day tasks.
Auro CRM directly addresses the needs of businesses and has built an integrated software solution with a new interface and features the ground up businesses and customers. Auro CRM offers a CRM solution to small businesses and enterprises that are scaling and growing customers.
CRM collects data from documents, social media, phone calls, live chats, and all key channels your customers use to interact with your business. Gathering data is half the mission. You need to know what to do with data. That is where CRM shines again and again. Smart data distribution because integrated CRM helps you give a better customer experience.
Top 4 CRM Models:
There are different models for CRM. The top 4 common CRM models are:
IDIC model:
This model was developed by Peppers and Rogers Group. It is a generic blueprint for the implementation of CRM in various situations. IDIC is four stages of CRM implementation.
IDIC stands for:
- Identify
- Differentiate
- Interact
- Customize
Identify: The first step is identifying your customers and collecting customers’ information. Business accomplishes it by collecting information such as the customer’s name, address, and purchase history at different contact points across the company. The goal is to collect as much data and information about each customer. The data helps to make a buyer persona. It helps to anticipate the needs of customers. Moreover, it helps to understand purchase behaviors.
Differentiate: The next step of this model is to differentiate and segment the customers. You can segment customers based on the lifetime value- current and projected.
This is because all customers have different values for the business. When you differentiate or segment your customers based on their importance to the company, you will be able to prioritize customer relationship efforts and provide the best to the most valuable buyers.
Interact: The third stage of the model is where you apply CRM plans for interaction with customers. Once you have analyzed information and data, segmented customers, you develop customized interactions. Offer personalization and customization for products, services, and customer experience that fits best for the segment. Again, optimization is key to profitability.
For example, for valued customers, you offer loyalty benefits or share rewards that encourage repeat purchases. It helps customer retention and continued customer relationship.
When you interact, you need to keep learning from these interactions so that you can continue to improve future interactions.
Customize: After analyzing customer interactions, you can offer more customized one-to-one service. The goal is to meet the needs and expectations of each customer.
QCI Model:
QCI Model is a customer management model, unlike the Customer relationship model. QCI stands for Quality Index Model.
Quality Index Model has three main activities:
- Acquisition
- Retention
- Penetration
The QCI model concentrates first on the customer’s external environment as the top priority, such as pain points, their business goals, and various factors that will affect their buying, i.e., if they are ready to shop or interact with your company’s sales team that is impacting customer’s experience.
The customer experience impacts the customer proposition that you offer the customer. The customer experience’ affects customer proposition and this effect on customer management activities. When you see this from the magnified version of the inner circle, various activities are involved for acquiring and retaining customers. The QCI model considers people and tech involved that keep the whole system going.
QCI model has replaced the relationship aspect in CRM. Yet the model emphasizes is on people only. The model is about people from start to end.
Payne’s Five Process Model:
Payne’s Five Process CRM Model was developed by Pennie Frow and Adrian Payne. Payne’s Five process model emphasizes on cross-functional approach for efficient and effective CRM processes.
This model has two main components:
- Cross-functional CRM process
- CRM implementation with Key Elements
The Five processes of Payne’s Model:
- Strategy development
- Value Creation
- Multi-channel integration
- Information management
- Performance assessment
The Payne’s Five Process Model’s four key elements that are necessary for successful CRM implementation are:
- CRM Readiness
- CRM Change Management
- CRM Project Management
- Human Resource Management
Implementation of CRM strategy as per Payne’s model, the companies need to conduct CRM readiness assessment, to improve which will help determine the company’s preparation for implementing the new CRM process.
CRM involves fundamental cultural shift and operational shift the companies need to invest in the CRM change management as well as CRM project management being the new strategies which are being introduced and complexities of the establishing CRM initiatives for the company grows.
And finally, the importance of employee buy-in is crucial for the success of CRM. You need to make sure sales, marketing, and customer support staff employees understand strategies, processes, and engagement that is customer-centric culture.
When you take care of all underlying conditions and key elements, the CRM process succeeds.
CRM Value Chain:
The CRM value chain is a high-level model developed by Micheal Porter, which identifies processes the business use to develop end products and services for the customer.
The goal of the CRM Value Chain Model is to identify and prioritize the most valuable activities for the company and improvement processes, which enables gaining a competitive advantage.
The CRM value chain model then applies these principles to customer relationships. The CRM model observes all various stages and activities required for building a relationship with your company’s customers.
The activities are divided into two stages:
- Primary
- Support
Primary Stage:
CRM Value Model Primary Stage of CRM includes 5 main processes to enable implementation of the strategy:
Customer Portfolio Analysis: This is similar to the IDIC model; the first step of the value chain model is to identify your customers who have the most value for the company. This stage analyzes and helps the company understand their customers better to anticipate their needs, wants, and expectations. They need to develop strategies for the maximization of lifetime value.
Customer Intimacy: next step is about engagement with customers and building on an original database about customers’ information. When a customer engages at a touchpoint, the companies must collect data of interaction to have a better understanding and serving of the customers.
How better you know your customers better, you will be able to adjust services and products accordingly. This will be better for customer retention and business in the long term.
Network Development: Business network development includes people, entities involved in the value chain. This includes suppliers, partners, investors, and customer service. The goal is to use customer data for processes at each level of the network so the entire system can work together to optimize your customer’s experience.
Value Proposition Development: Now that you are armed with customer information and their history of interaction data, you create value for your prospective customers or target customers. The idea is to shift focus from products to customer service so that there is cost reduction to create more value for customers.
Relationship Management: the last stage is about the management of the customer lifecycle. The process involves evaluation of business process and organization’s structure in the management of acquisitions, retentions, and customer development.
Support Stage:
Five support conditions that are critical for effective implementation of the strategic process of the primary stage:
- Culture and leadership
- Procurement process
- HR management process
- IT/ Data Management Process
- Organization design
Create and develop the above-mentioned underlying conditions to implement a successful CRM value chain.
Auro CRM model of implementation of CRM strategy is for all businesses who want to give the best customer experience. Keeping track of processes and data Auro CRM helps with features that help businesses boost sales and produce comparative reports, which build strong and better customer relationships. Auro CRM helps small and medium-sized businesses close deals, offer better business process automation, and refine software configuration.
