Compulsory activities before planning a CRM Strategy to improve Customer Relationship
The right CRM strategy defines the success of a business and its effectiveness on the people using it. The following activities and strategies emhances your insight on your customers and wht they need.
Customer first strategy:
Identify your target customer inline to the existing business model, sales goals and corporate mission.
Before you script the CRM Strategy, get better clarity on the types of customers you should be serving. In addition, identify the types of interactions with each segment that will generate the greatest loyalty among customers and the most profit for the business.
Use customer-centric model to identify the target customers. Perform an exercise on customer segment management. In this exercise, segment groups of customers based on similar attributes and describe how you want to manage those segments in a way that maximizes both the benefits to customers and the long-term profit potential of the organization.
A typical customer segment management model would consist of several stages called the continuum. These stages include:
- product-centric analysis
- marketing segmentation
- customer management
- customer-segment advisors
- customer segment owners
- customer-centric profit and loss
Apply the relevant stage depending on the type of the organization and what industries you belong to. The most important thing is to achieve the right balance on this continuum and choose the most appropriate and effective channels to fit with organizations’ capability.
Customer P&L Strategy:
After working on the segmentation, build a profit-and-loss strategy for each of your customers. Here you must factor in: Customer profit, gross revenues, customer allowances, credits and discounts, product costs, channel costs, cost–to–serve and administrative costs. This activity will throw light on a lot of factors related to customers, and not conducting one may result in unprofitable customers.
This will also allow you to determine the appropriate level of service, pricing, discounts, and resource allocation. You will also be able to determine how many resources need to be allocated for the greatest return. This activity will also help in determining the fundamental business goal, which is not to build sales or market share, but to increase profitability based on understanding who its customers are.
Channel development strategy:
Choosing the most appropriate and effective channels is a must to achieve better reach and attain profitability. In this activity, you will be identifying and evaluating all the potential channels available to you. By the end of the activity, you must be able to justify which are the most effective channels that will work for your business and why you have chosen them. This requires extreme attention and research.
Comparison between old business strategy and new business CRM strategy:
In this stage, work towards Incorporating change scenarios and new relationships, roles, and interactions in the channels identified. Compare the old strategy and the new strategy. Identify where channel-change is needed and where the channel conflict will be most intense.
Determine market power and channel value for each existing channel and build a framework for strategic thinking. Implementation of these strategies will bring changes to your marketing strategy’s core components as well.
With this, you will be able to determine brand value and understand your customers’ behaviours. The organization must also realize that the brand is more than just a name, icon, or slogan.
Success with these strategies will result in high levels of repeat purchase, insulation from price increases and improved responsiveness to marketing communications by customers.