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Customer strategy is about finding the right customers for your business

CRM is a swearword in some circles. A focus on software sales and big systems implementations has hidden the true value of focusing on customers. Real customer relationship management is about how your people relate to your customers as people. It is not about software or data. It is about enriching the experience of your customers so they buy more, more often.

How Customers contribute to the success of your business

Each of your customers does something for your business. At one level your customers either make you money or lose you money. At another level customers make other contributions. These can include loyalty, positive word of mouth, consistent billing behaviour etc.

Customer strategy - your activity checklist

  1. Find out who your profitable customers are - use this as the basis of your segmentation, work on the basis of what customers do not what they think. Customer profitability done simply is a calculation of how much it costs to serve individual customers and how much they buy from your and what they buy. You’ll need to examine which customers use which channels and where the spend is coming from.
  2. Ensure you know what your customer segments do for your business. With a profitability analysis you should have some idea about which customers you want more of and which customers you want fewer of. Be assured that in many businesses there are groups of customers who cost more to serve than they give back. But before you abandon these customers make sure they are not making other intangible contributions to your business
  3. Ensure your service delivery is based on the requirements of your most profitable and contributing customers. Capture information about who your customers are, when they buy from you and how they go about buying. This information is vital in informing both your marketing and customer strategies. Unless you understand how your customers want to behave you cannot define a service to meet them
  4. Ensure your service expectations matches their service expectations - different customers have different needs. It sounds obvious but many organisations ignore it and either spend too much looking after their customers and lose money; or spend too little and end up losing customers

If there was one thing that we would say about crm it is this; focus on getting the basics right in terms of service, Treat customers as people, keep your promises, do one thing better than your competition and communicate early and often. It’s amazing how far you can get with this advice. It often means you don’t need expensive consultants as well!

  • advert1: We're always happy to talk and a few minutes on the phone is free and may create some fantastic opportunities 01273808923. Or contact us here
  • advert2: At its most simple, customer relationship management is a strategy that aims at delivering more with less; it is about achieving better financial returns from customers, both new and existing. The approaches to doing this are based on either reducing the operational cost of achieving current revenues (lowering cost to serve) or increasing revenues within the context of maintained or reduced costs (improving service). Organisations that have pursued a crm strategy have done so by focusing on systems and process based change. This has often led to a low level of satisfaction with the level of benefits delivered. In our experience successful crm is made up of 80% “soft” (behaviours, organisation, attitudinal, skills) change and 20% “hard” (systems and process) change. Our experience has also shown us that ignoring the soft side (which many organisations have done) threatens the success of any crm programme.
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  • advert4: Have you considered building a customer community website? If your product or service has the right criteria it might pay dividends