Customer Relationship Management (CRM) has come a long way in the past few years. Originally, CRM systems were designed to support the sales team and they were big, unwieldy, and expensive technology systems designed to capture customer information and help sales teams manage their customers and prospects.
Unfortunately, the CRM systems often failed to work and they developed a poor reputation as expensive systems that use up time and don’t add insight or value. This feature in CIO documents some famous CRM and Enterprise Resource Planning (ERP) disasters, but you don’t need to search very hard to find many more. Both CRM and ERP have had a poor reputation for a long time, but this has changed dramatically.
For a start, the modern customer journey is far more complex than ever. Customer interactions today comprise everything from marketing to sales to customer service touchpoints and this is dramatically more involved that the traditional environment where most customer contact was post-purchase and all managed by the customer service team. Interactions with customers and prospects now can be around initial product awareness or maintaining a good relationship with a loyal and long-term customer.
Managing this complexity is not easy and so the use of CRM has become an important strategy once again, but this time there are several reasons why the CRM environment is different:
Pay-as-you-go: instead of those old systems where companies needed to spend upfront on expensive software and then even more expensive customization, most CRM systems today are available on a pay-as-you-go basis so companies only pay for the number of users actively using the system.
Cloud: systems no longer need to be physically located inside the company on PCs or servers; all the software can usually be accessed via the Cloud using just a standard Internet connection. This not only makes it much easier to install CRM, it dramatically reduces system maintenance.
Automated Data Capture: it is much easier to automatically capture information on customer behavior today. For example, any online shopping activity in a retailer’s system can automatically be ported into the CRM database: the old days of needing to manually import and clean up customer data are long gone.
Data Analysis: it is possible to extract far more insight into customer behavior today. Modern CRM is not just about managing basic customer information and contacts, now you can spot trends and predict behavior based on data analytics.
Competition and Specialization: there are many more CRM systems out there, from the big players such as Salesforce and Oracle, to very specialized systems that focus on specific verticals. It’s much easier to find a system that matches your needs, reducing the need to always customize a system for your customers.
This last point is perhaps one of the most important of all. Competition in the CRM marketplace is not only helping to ensure that the systems fit your business better than ever, but this stronger competition and vertical specialization is ensuring that modern CRM systems better reflect the highly complex customer journey that most companies now have to manage.
Let me know what you think about the CRM evolution and state of modern CRM competition by leaving a comment here or get in touch via my LinkedIn.