Managing your customer relationships

Managing your customer relationships

customersAs a small business owner, you know that if you don’t provide superb service to your customer, you cannot grow your business. Your customers are your lifeblood: without them, you wouldn’t be here so you must nurture and care for each and every one of them. Right?

Yes. And no. On the yes side, there is no question that businesses today live or die by customer service. E-commerce has served to underscore the value of above-and-beyond service, with companies like Amazon setting such exceptional standards that it’s difficult for customers who’ve shopped there to accept anything less from other businesses.

On the no side of the scale, great customer service alone is not sufficient to retain customers and build business: to achieve these, service needs to be entwined with a commitment to customer relationship management (CRM).

One of the first and most difficult things you must accept when you embrace CRM is that all customers are not created equal, and therefore cannot be given the same level of attention. You must identify your most valuable customers, then assign your resources to servicing them and building strong relationships with them. This does not mean that you ignore, or dump, lower-value customers: it simply means that you channel finite resources into areas that provide maximum long-term return.

So What Is CRM?

Robert Wayland says in his book Customer Connections: “Customer relationships are assets that should be evaluated and managed as rigorously as any financial assets.”

CRM is simply a way of selling products or services by building individual relationships with each customer and each prospect, on a foundation of mutual trust, emotional support, privacy protection and tolerance for other relationships.

Relationship management is not flogging off product-line extensions, over-surveying customers, buying new customers with fabulous deals, discounts and lead-ins, irritating them with an endless stream of junk mail or telemarketing calls. CRM shifts the company focus away from being purely product-centred. “Get the order at any cost” morphs into “How can I help my customer?”

Through CRM, you encourage customers to continue purchasing from you in the future - without the old-fashioned ‘hard sell’. Perhaps even more importantly, you transform them into referral-generating advocates for your business. This is where the trust factor comes in. What’s the first step you take when you need a stockbroker, a health-care provider, or a plumber? You ask people you know for recommendations - because you trust your friends to give you reliable information.

In today’s sophisticated marketplace comprised of educated, informed, sceptical consumers, CRM is the only way to sell. However, it’s important to stress that creating loyal relationships with customers can never compensate for weaknesses in other areas of your business. So before implementing CRM, check that your organisation’s infrastructure is sound: that the products or services you offer meet customer needs, that your sales and distribution channels are up to scratch.