Does your marketing team get all they can from contacts and prospects? The meat-packing industry is notorious for using every part of a cow and squeezing the last bit of value out of the cow. Can you say that your marketing team optimizes your relationship with contacts and prospects?
Each time a contact or prospect engages your community a relationship is being developed and this encounter has value to your community; not as a resources to be squeezed rather as an opportunity to fully meet the prospects requirements. Your organization meets the needs of your residents, but does your marketing and sales team develop relationships designed to meet the individual needs?
Your marketing and event teams generate lists of names but: Does your management know the probability of converting an event’s guest into a resident? And when? Or the process to transform a guest into a resident? Management should have the answers to such basic questions.
Customer Relationship Management
Successful organizations have implemented Customer Relationship Management (CRM) strategies to create sales. CRM is not new; it was used by ‘general stores’ over 100 years ago where the merchant order merchandize based upon the his knowledge and relationship with his cliental. This article will describe Customer Relationship Management and hopefully remove some of the mystery surrounding CRM.
Customer Relationship Management (CRM) refers to an established process for how a company establishes and manages the value it brings to leads, prospects and customers. Software companies have locked onto CRM because of the vast amounts of data generated and potential for IT associated with CRM programs. The CRM enterprise solution works for well-funded IT budgets; yet the rest of us can benefit from CRM precepts into our view of leads, prospects and customers. The goal is to facilitate stronger relationships with prospects and customers.
A Special Orientation
Customer Relationship Management is based upon the long-term view of obtaining and delivering value to prospective and current customers. The core to Customer Relationship Management:
- Views marketing and sales engagements as opportunities to exchange value
- Builds long-term customer relationships
- Delivers value to customers and profits to company
- Is based upon Acquisition, Retention and Expansion of products and services
Customer Relationship Management programs require the company to possess a Market Orientation and realize that not all customers are created equal. CRM requires a holistic view of the customer that include an understanding of how a relationship can be built before the prospect even perceives the need to strengthen the relationship after the prospect becomes a client. Customer Relationship Management is a tool that organizations use to satisfy customer needs and contrary to Software Vendors does not require large investments in IT.
I have used and implemented CRM techniques more than 15 years ago and found that these processes really do worked without large IT investments! CRM has helped me build strong business relationships, removed barriers and maximized sales. Customer Relationship Management is a large topic; so I will limit my discussion to Customer Acquisition. The following diagram presents the key CRM phases which illustrate the never ending process of getting closer to the customer.
Diagram 1: Customer Relationship Management Model:
Customer Acquistion: This is the process of attracting leads, converting to prospects and securing customers. The major elements include lead capture, communication, response capture, analysis, marketing/sales action, and close/acquire customer.
Customer Retention: Keeping the customer as a client. Retention does just happen. Retention requires that companies build effective programs and process to retain clients, even during times of stress.
Customer Extension: The ultimate goal is to maximize the client’s purchases from the company. We live by the mantra that it is more expensive to attract a new customer than to service an existing customer.
Acquire
Capturing names is the tool used to feed the best: providing leads (to be more specific à qualified leads) to the sales funnel for convert to customers. Sales thrive on qualified leads and this critical function enables companies to survive. We have found that successful companies feed the beast and develop relationships with their leads; but other companies wonder why it is so difficult to close opportunities.
As usual, I advise companies to focus on the basics. For Acquisition, marketing is to document their lead generation model, determine costs, assess the value each customer brings to the organization and estimate the return that each lead brings to the organization. The goal is to generate qualified leads that can be identified, measured, and converted to sales. Marketing is to first document their process by capturing each activity that a community has hosted and build the Acquisition budget. I will expand upon customer value and ROI at a later date, but Peppers and Rogers discuss valuation in their book “Enterprise One to One.”
The acquisition steps are foundational for transforming name lists into qualified leads. The acquire program that you organization implements must fit into the community’s existing business model, marketing & sales strategy and culture. CRM is an organizational orientation, so your marketing, sales and operations teams will need to participate and agree upon the basic definitions for lead, qualified prospect and other important measure.
I have heard advocates who claim that CRM will cure everything, including the winter ‘blahs,’ but success requires hard and consistent work. The diagram below demonstrates the basic steps for transforming names into qualified prospects and eventually customers. It is important to note that CRM is a process and not a one-time event.
Diagram 2: CRM Process
Step 1: Gather and organize your existing leads. This requires that your team gathers all the leads collected over the years and consolidate into a single repository and develop name collection into every event. . This list of names should include: Name, Address, Phone, Email, Activities, Sales Stage and Notes.
Step 2: Creating a lead database. The list of names is your contact database that feeds your sales funnel beast. The activities (events, communications, touches, etc.) are used to develop your calendar. Detailed records are required establish cost of acquisition. Marketing shares this information with sales to transition the relationship and move the lead through the sales process.
Step 3: Marketing Programs. The marketing activities will use the lead data base to for newsletters, Direct Marketing, Telemarketing, Seminars, Advertising, etc. to drive interest and participation at your events. The goal is to host events that build individual relationships and craft solutions that best meet the prospect needs.
Step 4: Analyze. It is critical that reports are generated to support activities. Creating customers is a process and not an event. Success should be measured and reported to management to orient the company to customer acquisition.
Step 5: Sales engagement. The establishment and buy-in on the CRM process defines when and how the qualified lead transitioned to sales. A qualified lead will have an established relationship with the organization which shortens the sales cycle.
'Squeeze' Every Relationship
The long term benefit for a Customer Relationship Management is that community will understand the acquisition process and build relationships that are binding. Your organization will be able to identify which resident types provide the greatest revenue, profits and are most likely become residents. Most important, the CRM approach enables the community to develop and expand its relationship with each resident.
