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Return of CRM in marketing

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Jacqueline Burns is a freelance writer who specialises in marketing, media, advertising, technology and management. She is also marketing director for commercial law firm, Hunt and Hunt.

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Top 10 CRM tech tips

  1. Involve your IT department. Even if you opt not to install software, you will still benefit from the expertise of your system specialists.
  2. Identify the right solution and supplier for your needs. The market is rich with options.
  3. If you are implementing a system, seriously consider integrating it with your back office.
  4. Whatever approach you take, ensure you have adequate security and disaster recovery plans in place. Your customer data is one of your most valuable assets.
  5. If you opt for an on-demand solution, strict contractual links between you and your data are paramount. 
  6. Think carefully about what data you decide to capture. These systems are seemingly boundless, but the cost of keeping data up-to-date can quickly outweigh the benefits.
  7. Make sure you have the necessary commitment and executive sponsorship before you get started.
  8. Go slowly. You will achieve better results if you approach CRM in stages. Get the basics right before you move on to stage two.
  9. Think twice before you customise. The latest products have been refined over the years and may even be tailored to your industry.
  10. Remember, technology is only a tool, not the solution. Software doesn’t build relationships. People do.

Jacqueline Burns explores why the new breed of CRM solutions is finding favour with marketers.

Customer Relationship Management is back. Though CRM had not disappeared per se, until recently it had diminished in priority and profile since the turn of the millennium. The initial hype did not live up to expectations and the disappointing results that were achieved by some early adopters deterred others for a time from investing heavily, or at all.

That was then. A key finding of the 2006 AFR Boss annual Marketing Directions survey, now in its sixth year, is that there is a revolution taking place in CRM. Approximately 40 percent of respondents to the Boss survey indicated CRM is impacting marketing spend, with some rating the impact as 'significant'. Across the board, CRM is driving a more targeted use of marketing and, consequently, is leading to a reduction in media spending.

The Boss findings are supported by Gartner’s 2006 and 2007 global predictions, which include: that the scope of CRM will widen, that there will be a boom in projects to create a single view of the customer and that companies that don’t invest in CRM will be left behind, and then forced to catch up.

For many, CRM is synonymous with technology. Though the applications and systems are a part – indeed, a critical component – of it, CRM is much more than systems alone. By definition, CRM is the holistic interaction a company has with a customer or client. It has strategic, operational and analytical components. Technology simply enables a vastly more efficient and effective means of managing customer relationships, be it one-to-one or en masse. The applications allow marketers to capture, interpret and act upon data about customers – their purchase history, price points, buying behaviour, interests, future requirements and so on.

Bear in mind, the ultimate objectives of CRM are to retain customers by fostering loyalty and increasing satisfaction, and to grow revenue by improving each customer’s value.

Continual improvement

Beaton Consulting’s Colin Jasper reflects on how the approach to CRM has evolved over time: “Early on, a lot of money was invested in CRM technology, and a large amount of resources were spent populating those systems. Before long, many companies realised they were only using a very small proportion of the systems, and of the data that was being input and maintained. Effectively, the cost of keeping the systems up-to-date significantly outweighed the benefits.”

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