HP Technology at Work

The must read IT business eNewsletter

4 steps to build strong customer relationships

4 steps to build strong customer relationships

January 2012

In a perfect world, businesses would have the ability (and the time) to create personalised relationships with potential customers and be able to customise their communications to meet each customer’s needs. But the world is not perfect, so businesses will continue to look for new ways to solve specific customer problems and sell more products. Doing this is often cost-prohibitive and occupies too much of the business’s and customer’s time.

Most small and medium businesses (SMBs) actually don’t have a solid customer relationship management (CRM) system in place. In some cases, SMBs can get away with using third-party list sources to get an average assessment of their customer base, so a large-scale CRM system isn’t always necessary.

Managing customer relationships—in four steps

Setting up and managing individual customer relationships can be broken up into four related tasks.

  1. Identify customers. The first task in setting up a relationship is to identify, individually, the party at the other end of the relationship. Many companies don't really know the identities of many of their customers, so for them this first step is absolutely crucial.
  2. Differentiate customers. Knowing how customers are different allows a company to first focus its resources on the customers who bring in the most value for the business, and then to devise and implement customer-specific strategies designed to satisfy different customer needs.
  3. Interact with customers. Companies must improve the effectiveness of their interactions with customers. Each successive interaction with a customer should take place in the context of all previous interactions with that customer.
  4. Customise treatment. If possible, a business should adapt some aspect of its behavior toward a customer, based on that individual's needs and value. 
CRM vs. database management—which one is right for you?

Ensuring the effectiveness of marketing promotions is critical to the growth of any business. There are typically two ways to do this. The first is CRM—a common strategy that businesses implement to manage interaction with customers—both current and prospective. HP Customer Relationship Management Services provide efficient, effective services that let you recruit, retain and reward your best customers, anywhere in the world.

The second is Database Management, which uses segmentation, measurement, data modeling, and analysis to enable businesses to automate the collection and use of customer insight in their campaigns.

Increasing sales with CRM software

CRM can help sales in a multitude of ways. Here are just a few:

  • Keeping customer data in one place: Sales teams spend too much time putting together customer data stored in different locations. CRM software lets people access data on a customer’s past purchases, behavior, preferences and usage, as well as demographic and contact information—quickly.
  • Qualifying leads: Not every lead converts into a sale. So how do you improve the ratio of leads to sales? CRM software can track past performance and identify metrics (past purchase value, income, age, etc.)—helping to determine which leads are “hot” and which aren’t.
  • Cross-selling: With better, updated knowledge of customer behavior and preferences, you increase your chances of up-selling to existing customer’s increases.
  • Future planning: Modern CRM systems provide for detailed reporting, including the ability to link sales results with different inputs. This helps businesses analyse the cause of both success and failure and plan for future rounds of sales activity.
Clean, clean, clean!

The only worthwhile data is clean data, so don’t waste money mailing to customers who are no longer relevant—or worse, no longer exist. To protect against dirty data, marketers must build merge-purge processes into all incoming data streams. Data augmentation techniques help marketers fill in partial records and paying attention to changes in activity can help marketers clean out contact records that have changed roles or companies.

Reap the benefits of successful B2B database marketing

There’s a lot to learn from B2B marketers who develop a marketing strategy incorporating a marketing-specific customer database. They often practice three key things:

  1. Target prospects through timely, relevant messaging. B2B marketers use database marketing to learn about and segment customers. With this deeper customer insight, marketers can design and execute more relevant, personalised communications. They also use database marketing to manage contact frequency in order to avoid inundating their prospects and customers with unwanted communications.
  2. Better align with sales through improved prospect targeting and lead management. Advanced B2B marketers use customer knowledge gained from database marketing to better qualify demand. Scoring leads using explicit data like industry, size, and role and implicit data like expressed interests and desires allows marketing to identify the best leads.
  3. Improve efficiency and measurement of marketing efforts. Database marketing helps B2B marketers’ resolve one of their biggest challenges—shifting the perception of marketing being a cost center to more of a strategic partner role. Marketers should actively seek out sales’ input to develop the profile of a hot lead. They should also use analytic tools to identify customers.
Social media CRM expected to bloom in 2012

Gartner predicts the social CRM software market will be over $1 billion by 2012. [1] Social CRM is a business strategy that benefits both cloud-based communities and the business by encouraging engagement and generating opportunities for sales, marketing and customer service.

The best way to think of CRM and database management is this:  no sales, no business. Even in very small companies, using CRM software to coordinate sales can bring big dividends.

For more information
Dazzle customers with extraordinary service
Gartner says social CRM market will be $1 billion in 2012
HP Customer Relationship Management Services
Using social media for CRM: an overview

[1] “Gartner says social CRM market will be $1 billion in 2012,” February 23, 2011.

Popular tags

Most read articles

HP Technology at Work

Contact Us
Search archive
Customise your content