Managing Customer Information
Large Organizations Collect Significant Amounts of Personal Data.
Jan 15, 2009
Organizations such as financial institutions, healthcare providers, travel agencies, retailers, automotive manufacturers, government agencies and communication companies, among others, collect this data to:
- Do targeted marketing based on individual preferences
- Analyze customers for profitability
- Evaluate their own service levels.
Getting positive, measurable business results from these activities does not come from simply gathering information and storing it, and many CRM strategies have failed to achieve objectives because of difficulties in developing a strong understanding of who customers are and what they really want, and applying this knowledge to establish customer relationship strategies and processes.
Correlating Customer Data
Some companies build large data warehouses to crunch information about their customers to determine buying habits or product preferences. If correlation among customer purchasing habits is not properly done the relationship between one set of data and another will not be valid from a business viewpoint. Technology and business processes must be applied in a logical context to ensure that customer data is applied to meet CRM objectives.
CRM brings technology to bear on business processes, to enable organizations to use historical customer transaction data to manage customer relationships better, to bring the benefit of a formal approach to customer relations, designed to build meaningful, long-term relationships with customers.
Tools of CRM
CRM is based on a set of technology tools, especially data information-based tools that allow organizations to capture, analyze and apply the large volumes of detailed customer data needed to achieve a better understanding of their customers, and to make more informed business decisions.
It is important to choose the right technology tools to support a CRM solution. Technologies that directly support CRM, and other technologies that provide indirect support, such as wireless, voice-over IP (VoIP), and e-mail-based Internet communications, have evolved to the point where there are many more channels for customer interaction. Four business tools that support CRM include:
1. Customer contact software
2. Marketing campaign programs
3. Channel integration
4. Product literature.
Legacy Systems
Where legacy systems exist, an interface may be required to interconnect the legacy systems to the CRM solutions. The key challenge for the CRM project team is to select a series of software tools that fit the business needs, and evaluate these tools to select the best ones. This process is often made difficult because the selected tool may not be the final version, since the history of software is one of frequent and periodic updates and subsequent software maintenance requirements.
Seamless Integration of CRM Tools
The IT department plays a very prominent role in the development, implementation and support of a CRM solution, because technology tools need to be selected, analyzed, acquired and seamlessly integrated into the IT environment. This requires a formal plan to manage the selection of the tools – from a data warehouse and database software, to the business applications and processes.
While some companies have adopted formalized CRM strategies early in their corporate histories and are achieving measurable business results through CRM initiatives, others may have to totally revise their corporate cultures, modifying historical approaches to dealing with customers, and changing their sales and marketing programs.
Organizations that do not have a formal process for managing customers by monitoring and gathering historical transaction data, and then analyzing this data to determine responses that meet each customer’s needs, will require major efforts to develop appropriate CRM strategies.
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