How to Manage Customer Relationships Effectively

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​As business practices adapt, change, and develop over time, new terminology tends to get added to the standard business lexicon. A relatively recent addition is ‘customer relationship management’. Of course, the concept is not new; interest in improving business/customer relationships is as old as the act of doing business. What has changed dramatically in the last two decades is the technology that supports customer relationships.
A customer relationship management system, or CRM, is the software component that has driven industry change since the 1990s. While technology has certainly impacted the way business is conducted, both old and new issues remain. These include:
How companies can acquire customer data more efficiently;

Which data is most important, and

How staff can access data when they need it.

Solving these enduring challenges can help businesses get more value out of a CRM and ensure the technology meets the expectations of not only on-the-ground sales staff but also top-level executives.
The Traditional Approach: Understanding Customer Needs
A fundamental tenet of customer service relationship management is understanding the needs of the customer. While this may seem obvious, a company-first approach can quickly subsume the idea. The inability to maintain a customer-first approach may result in the development of unwanted product features or marketing materials that fail to reflect the real-world challenges that customers face at home or at work.
Frame Benefits for Customer Problems
Every product or service has a certain set of features and presumed benefits. Typically, these features—especially those that make it into marketing copy or sales conversations—are the ones that offer the highest value to a customer. How, then, does a company determine which features are likely to offer the greatest benefit to consumers?
Determining the answer to this question must start with an effort to understand the specific problem a customer faces. In-depth customer knowledge can help companies more accurately—and more clearly—articulate the benefits of a product or service.
For example, a faucet may be both easy to install and aesthetically impressive. But the value of those features may be weighted differently by different buyers. A building contractor seeking a system to install in dozens of homes may prioritize ease of installation. A single purchaser investing in high-end kitchen refurbishing may focus more on aesthetics.
A business that knows which customer it’s speaking to—in an email, on the radio, on the phone, or any other channel—is better positioned to highlight the product features that are persuasive benefits in the mind of the customer.
Align Marketing Materials and Sales Pitches
Historically, a business’s marketing and sales departments were siloed components. This separation often resulted in poor data sharing and, in some cases, outright conflict. A modern CRM has the potential to integrate bits of information gained during the marketing and sales processes to provide a complete portrait of a customer.
It may be especially valuable for businesses that depend on repeat customers. First, integrated sales and marketing data can help those businesses drive more recurring sales. Second, a business can identify certain marketing materials, sales strategies, and customer profiles that are most likely to generate more repeat business.
This complete portrait of a client—and the expectation of ongoing interactions between a business and its average customer—is behind the rise of the word ‘relationship’ in customer relationship management. This wider, more personal lens has shifted how companies develop marketing and sales materials. It emphasizes the importance of understanding the psychology of managing customer relationships for new campaigns.
Develop Products Based on Customer Feedback
Even after the sale, customer relationship management and CRMs have an important role to play. An effort to understand the customer extends beyond the point of purchase to soliciting and interpreting product feedback. This feedback can help improve an existing product or develop new products that meet a need defined by the client, not the business.
By inputting this information into a CRM, businesses have the potential to capture more information about how well a product solves a problem for a certain type of client. For example, the most satisfied customers may not be those who are most receptive to marketing materials. If the goal is to build consumer loyalty, materials may need to change to help build long-term relationships.
The Modern Take: Use Technology to Improve Customer Experiences
While CRM data has a significant role in the internal development of marketing materials, sales processes, and products, it can also have a direct impact on the customer experience. This role centers on technology’s ability to improve internal and external communication.
For example, a CRM can help streamline the transfer of information throughout an enterprise, resulting in more efficient communication that can improve productivity and increase the number of satisfied customers.
Improve Internal Communication
The rise of CRMs has targeted the well-documented gap between sales and marketing teams. It does so by improving access to data. A salesperson may start with a more robust profile of a prospect by investigating CRM data about which marketing materials a potential client has already received or requested.
However, large organizations may also benefit from sharing the data among other parties, such as call center or live chat representatives. These complex client interactions could span several communication channels over weeks or months. Keeping client data organized helps prepare each representative for a client interaction and empowers them to deliver more effective messaging.
This data sharing can also help resolve customer issues more quickly. For instance, a customer service representative may solve a client’s technical issue more efficiently with access to a full client history in a well-structured CRM. That information prevents a representative from asking a client to repeat details from a past issue, which saves both representative and client time.
Reduce Technological Barriers
Many large businesses seek to integrate multiple CRMs that may serve different departments or have been incorporated as part of legacy systems. Each component may represent an additional layer of complexity when it comes to providing staff with critical customer information in real-time.
Just as a CRM aggregates customer data, technologies like computer telephony integration (CTI) can help move data from multiple CRMs to relevant representatives as needed. This ability to route large amounts of information in real time has become possible with advances in cloud-based systems and high-speed Internet access.
As part of a broader system, CRM and CTI integration can help remove the technological barriers between company knowledge and expert customer service. After all, how valuable is customer data if it’s hard to find?
Offer Multiple Methods of Contact
Modern technologies enable businesses to offer multiple contact channels to clients: print, phone, email, and live chat, among others. The diversification of communication channels has added to the technological challenge while increasing flexibility for customers.
Customers may appreciate the ability to reach a company through various channels, but the companies that benefit most from the multi-channel approach are those that can bring together data from all interactions into a single system. That way, a phone representative has a recent chat history on hand, and a sales team member preparing for an in-person meeting already knows which questions have been answered via email.
Analytics from a CRM may even reveal which communication channels are most valuable for sales, issue resolution, or retention. That analysis can help a business make more data-backed decisions when it comes to allocating customer service resources efficiently. It may even help win a larger budget for high-cost interactions (like around-the-clock phone support) if that channel can be tied to greater customer retention.
Getting Started with a CRM
Using a CRM does not guarantee that a business will extract all its potential benefits. To get more from a CRM, businesses must have a strategy to acquire customer data, determine which data is most valuable, and use that data effectively. This may include assessing how prospective customers respond to marketing materials or gauging their satisfaction with a product after purchase.
Certainly, technology has made such investigations easier to conduct. However, the guiding principles of customer relationship management that predate a customer relationship management system are worth remembering: a business continues to benefit by focusing on the customer’s needs and desires in product development, marketing and sales materials, as well as customer service.
In the end, those businesses getting the most value out of their CRM are finding ways to deliver great customer service more efficiently and to continue to learn from their customers—data point by data point.
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