How Profit with CRM in a Recession

Business success is all about customers - and how you market to them. It's about generating more leads, making more sales and crucially retaining your customers.

It requires a lot of effort to manage customers via the mix of emails, calls, meetings, documents, spreadsheets, and notes. And that's only your own interaction. Multiply that tenfold if you have 10 people interacting with customers.

Making sense of it all can be very time-consuming. How much time and effort would your business save if you could keep all of your customer information in one easy-to-access place?

By doing this you'd be able to spend more time actually doing business and less time managing it.

This is where CRM (Customer Relationship Management) can help you make sense of it all by recording and sharing all this information with the people in your organisation in a simple to understand format.

Produce consistently positive results and end negative patterns

To manage and grow a successful business, you need access to both high level and granular information to identify trends and see the consistency of day-to-day operations. As a result, you learn how to reproduce positive results and quickly end negative patterns. In other words, develop 'best practice' for all employees communicating with customers, turning each and every one of them into a 'salesperson'.

Identify your best customers with a 360 degree view

CRM provides a single view of your contact information across the organisation. Why is this important?

Firstly it will give you analysis on how many customers you have, what they are worth, how much they cost to acquire, how many you have lost and which products sell to particular types of customers.

Secondly, it provides the knowledge to communicate with customers in the most effective medium, whether that is email, letter or phone. The communications can then be targeted to the right customers with the right message at the right time.

A 360 degree overview will highlight your best performers internally, particularly sales people, so it's easy to spot those who aren't performing and help them become more effective.

The cost of not adopting CRM

Difficulty spotting selling opportunities within your customer base
A sales executive spends 6 weeks closing a £10k opportunity with a new prospect rather than spending 2 weeks closing a similar opportunity with an existing customer [£20k opportunity cost]

Too much time spent on administration
A sales manager with a base salary of £40k per year spends 10 hours per week on sales administration [£10k direct salary cost per year]

Poor visibility on marketing performance
A marketing manager spends £20k a year on advertising but can't see how many leads it produces. [£10k wasted] assuming at least 50% of advertising is ineffective]

Customer service errors & declining satisfaction
At a company with 400 customers on £2k per year service contracts, a 30% increase in call queuing time translates into a 15% increase in non-renewal of service contracts the following year [£120k in lost revenues]

Can you afford to ignore CRM?

As the uncertainty around business confidence continues, many businesses retreat into ' saving mode', trying to reduce costs as much as possible.

Until the global downturn most businesses enjoyed a good flow of new leads. If conversion rates were strong then some issues like missed opportunities, reducing customer churn rates and eliminating manual processes were often swept under the carpet. In short, some firms viewed CRM as a luxury.

Times have changed! Leads are now thinner on the ground, sales cycles are longer, costs need to be reduced and for most firms their continued success depends on customer retention.

Today, few firms can afford to rely on weak systems that cause enquiries to be missed, customers to be forgotten or forcing staff to spend endless time on repetitive administration.

By supplying CRM solutions during the last recession in the early 1990s we saw that those businesses investing in CRM were better able to sharpen their processes and achieve substantial bottom line savings. As well as trading through the tough times they were able to accelerate out of the recession more strongly than their competitors.

To coin a popular phrase, CRM really did help people get their ACT together!

Implemented effectively, CRM is a huge asset rather than a cost, and represents safe-guard for customer retention and cost effective customer acquisition.

A CRM system is important in all market conditions but especially so in tougher times when it's all about cutting costs, keeping existing customers and achieving better results with less resources.

In the present economic climate an effective CRM system is not just a crucial resource, it can be the difference between survival and failure.

Without effective CRM different teams have different customer views

The Sales View

Nick is a great customer, having bought more than £1000 of products every year for the last 3 years.

He's therefore entitled to an additional 10% discount. His preferred method of communication is email. He's recently moved offices.

The Marketing View

Nick is hard work, he received four catalogues in the post in the last year and numerous calls from the telemarketing team but he's only responded once and spent a total of £250 this year.

The Support View

Nick is a nightmare! He's made over 20 calls this year, using more than 13 hours of staff time and cost £500 last quarter alone to support.

The Finance View

Nick's business is a problem as they never pay invoices promptly. He’s 90 days past due and on hold.

Choosing the right CRM solution for your business

There's no shortage of CRM systems available. Entry level applications like ACT!, advanced systems like Sage CRM not to mention options for hosted as well as on-site solutions.

At Preact we offer one of the broadest range of CRM systems in the UK. To cut through the hype and confusion we've published comparison guides to help businesses evaluate the right system for their needs. To understand what's best for your business and to ensure than CRM functionality translates into tangible bottom line results call one of our CRM consultants on 0800 381 1000.

CRM Help, Advice & Tips
Our advice page is packed with guides and advice to help you achieve fast results with CRM software.

Complete our CRM selection form for personalised advice on the right system for your needs. More information on how to profit with CRM during a recession is available in a separate Sage CRM whitepaper.

Find Out More
For independent CRM advice and to find out how ACT! could improve your business call 0800 381 1000 to discuss your requirements with one of our consultants. Check out our Return On Investment Calculator.