Customer Relationship Management and Digital Transformation

Customer relationship management (CRM) is an organizational strategy (not a technology) focused on assessing and satisfying customers needs. CRM provides front line sales/marketing/support staff with a single view of customer data. It is used to maximize the lifetime value of a customer and minimize customer churn. It can be used to support customer relationships by attracting new customers, satisfy existing customers, retaining them and extracting further revenue via cross-selling and up-selling. This can be supported by an organisations CRM system such as salesforce or SAP.

CRM Overview (Sumner 2014)

Key Components in a Customer Relationship Management (CRM) system

A CRM system or eCRM is an information system used to capture, store and make available relevant customer data. It can be used by many depts around an organisation.

Components in a Customer Relationship Management (CRM) system (Scott 2021).

Operational CRM

Operational CRM has 3 components: sales force automation, customer service & support  and enterprise marketing management (EMM). The benefits of operations CRM include:

• Campaign Management: Generate “leads”  for the organization.
• Sales Management: Converts leads into customers.
• Service Management: provide support to customers, aids cross-sell and up-sell.
• Complaint Management: Supports query resolution to improve customer satisfaction.

• Market Research
• Support market research design, capture and dissemination around the organisation.
• Loyalty Management: Supports customer retention and reduction of churn.
• Lead Management: Consolidates information about leads and helps the organization nurture them through their buying journey.
• Customer Profiling: Build profiles of individual customers and segments for later campaign activations.
• Feedback Management: Allows the organisation to capture customer feedback for later improvements/actions.

Analytical CRM

The Analytical CRM can be used to analyze customer behavior and provide

actionable business intelligence. It uses data warehouses, data mining, decision support systems etc. It can be used for sales forecasting which predicts trends, identifying customer needs and be a repository of information about sales history, customer demands, demographic trends, competitor information etc.

Collaborative CRM

Collaborative CRMs support effective and efficient communication between customers and the organization. They provide a greater customer focus by understanding customer history and current needs. They lower communication barriers by providing staff with a significant amount of customer information. They support the integration for data/information from around the organization thus reducing data silos.

CRM contributes to the organisations business strategy

Both the principle of CRM and the successful adoption of a CRM system can have multiple benefits contributing to the organisation's strategy, according to Scott (2021) they include:

Improves Customer Service

• Improved customer satisfaction scores.
• Supports customer acquisition and retention.
• Improved customer support by providing customer service staff with the right information.
• Support staff to resolve customer queries or concerns.
• DProvide relevant information for decision making.

For example, Amazon captured 51 cents of every dollar that Americans spent in 2015 (Software advisory service n.d). Supported by their CRM and vast amounts of data, Amazon deliver a strong customer experience to increase revenues and repeat purchase. Amazon gives us relevant recommendations of future purchases based on our and other customer past purchases. They allow customers to create their own profiles and store customer credit card details for frictionless purchase.  

Improves Sales and Marketing

• CRM systems can be used by many depts including sales , marketing and customer service.
• Reduce staff time searching for customer information thus allowing sales/services staff to spend more time with customers
• Improve the effectiveness of sales teams by providing relevant and timely information. 
• Supports the organisation in forecasting future performance.
• Increases effectiveness of call centres
• It can support reduce time to conversion,  increased sales performance.
• Supports margin gains by providing relevant information and offers thus reducing the pressure to offer price discounts to secure customers.
• CRM systems can help the organisation to secure customers as seen int he example below.

CRM can secure customers (Sumner 2014)

Improves overall profitability

• Improved customer retention, cross sell and up sell.
• Access to information can reduce staff costs previous used for report creation and administration.
• Supports more targeted and relevant marketing campaigns.

CRM Benefits (Scott 2021)

According to Nix (n.d) CRMs help organisations by:

• Improving informational structure
• Enhancing communication with customers
• Making customer services better
• Automating the work processes
• Effective collaboration of different departments
• Better data analysing and reporting

Mini Case Study

Casio UK used Hubspots CRM and marketing tools to improve internal communications between teams and improve lead conversion. They used HubSpots marketing, CRM and sales software to increase leads by 496% and increase revenue 26%. Casio implement marketing tools such as landing pages, smart calls to action (CTAs), workflows, personas and A/B testing. The Casio team improved their knowledge by completing several Hubspot academy courses and onboarding training.  According to Taka Takeuchi, senior digital marketing manager, Casio UK; “We had a CRM that had been custom-built, but it wasn’t responsive to the evolving needs of our salespeople, and it didn’t give us a clear view of the customer’s journey. We were using Eloqua as our marketing automation platform at the time, but it was difficult to use and inefficient for a small marketing team. It was clear to me that we needed a platform to help us achieve results quickly, as well as a modern CRM.” (Hubspot n.d).

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