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‘Customer First’ should not be reduced to just a slogan  

Heavily reliant on IT, customer relationship management should focus on building enduring ties and putting the client at the centre of the process for profitability in the long term   

October 06, 2021 / 07:43 AM IST

Everyone claims that “we put our customers first” but how many companies practice what they say in their vision and value statements?

Most business-to-business (B2B) companies use customer relationship management packages in some form or the other. Surprisingly, the customer—or client—is not always a driving force in business-to-business client/customer relationship management (CRM) processes.

Understand CRM

The CRM process is typically driven by information technology or sales, shining the spotlight on technology and sales automation. However, this approach misses the key purpose of CRM, which is to foster enduring relations with clients that result in increased profitability for the firm in the long term. B2B marketers can take steps to move the process from what it is to what it could be.

First, let us examine the main components of a CRM process, including what I will call enablers and actualisers.

Close

Enablers include the front-end technology, automation and systems that allow firms to establish one-to-one relationships with clients. Enablers are necessary but not enough for CRM's success.

Applications providers and CRM consulting firms often treat CRM as a technological issue, taking a "build it and they will come" philosophy. The approach has resulted in well-documented failures in CRM implementation.

Actualisers combined with enablers help bring meaningful change to an organisation. Actualisers include needed organisational and cultural change, CRM training, alignment of business strategy with needed competencies, hiring decisions and deployment practices, and marketing applications.

Actualisers stretch beyond the bounds of the traditional marketing discipline, however, the marketing function's responsibility is to ensure that the customer gets centre stage.

Also read: Retaining customers most critical in trying times like now

Marketers can take these steps to put the customer first while developing B2B CRM processes:

Make sure that technology is driven by real client needs and not as perceived by internal folks. Get information on the client relationship requirements before the company buys expensive CRM software—make sure what the company buys aligns with the customers' needs.

Marketers can get answers to the following questions: what are the key factors to customer satisfaction and customer loyalty? How well does our firm perform against the competition on the key satisfiers? What information is needed to increase performance on key satisfiers?

Resource allocation

Clients must be segmented by value to effectively allocate marketing resources to clients. Client longevity and profitability are two useful measures of value to use in segmentation.

Client revenues may be a useful measure of value but only if prices and the cost of service delivery remain similar by the size of the client. (That is, if larger clients get bigger price discounts than smaller clients, or require higher service levels, the firm may find that its most valuable clients are the smaller ones.)

Once tiers are established, marketers can append industry type, employee size and geographical information to client records to identify lucrative sub-segments.

Also read: Driving growth: Are you making your customers happy?

Communicate 

Turn one-way messages into dialogues. Marketers use direct and indirect media with clients. Direct (human contact) communications include telemarketing, service support, telephone operators, trade shows, user groups, speaking engagements and face-to-face sales.

Indirect (nonhuman contact) communications include advertising, direct marketing, brochures, PR and websites. CRM fosters more targeted and knowledgeable direct contact with clients to build stronger relationships. For example, let's assume that clients are ranked and segmented into four priority tiers based on profitability. Marketers can use that information to allocate communications spending.

These two steps will help you decide:

Identify and prioritise direct and indirect marketing tactics that will strengthen client relationships. These might include client reward systems to encourage longevity, special "members-only" website content, e-newsletters, e-news alerts, educational events and different account management attention for valued clients.

Assign marketing resources to each client sub-segment, depending on its value to the firm. A tactical matrix can be developed where the client tiers, ranked by value, are listed down the left-hand column and the direct and indirect tactics assigned to each tier are shown across the rows.

Finally, measure results. If the desired results are not achieved, marketers may have to redo competitive performance research, reassess competencies and re-deploy talent, and make the needed adjustments in step three.

Marketers play a key role in making CRM a success. By following these steps, marketers can ensure that the client remains first in the B2B CRM process.
M Muneer is the managing director of CustomerLab Solutions, a consulting firm.
first published: Oct 6, 2021 07:43 am

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