Welcome to the economic downturn. If you are feeling anything like I am, it is next to impossible to go through a day without being reminded of the fact that we are going through some very rocky economic times. With the stock market in a free fall and countless businesses declaring that they are in financial dire straits, I feel like I am constantly bombarded with news that reminds me of just how challenging these times are.
Although it may be tempting to freeze spending on CRM, now is actually the time for companies to invest in revitalizing existing CRM capabilities
Professionally, I am hard pressed to find an organization that is not focused on saving money and increasing the efficiency of existing business processes and resources. What is one way for companies to do this? It may not be in the forefront of your mind during a recession, but customer relationship management (CRM) supports all of these endeavors. Customer-facing best practices—such as capturing the correct data for tracking, segmenting and managing prospects and customers, optimizing marketing campaigns, introducing self-service tools and call center automation, designing optimal sales territories, matching the correct channels and segments, and managing pipelines and forecasts to measure sales and predict future trends—can have a multiplying effect, leading to significant costs savings, improved efficiency and numerous business outcomes over time.
Although it may be tempting to freeze spending on CRM, now is actually the time for companies to invest in revitalizing existing CRM capabilities because they will realize more from their previous investments and be well-positioned from a competitive standpoint when the economy rebounds.
I have been working with a number of forward-thinking companies that are doing just that, and they will ultimately be in a position for success when better economic times return. As these companies know, identifying strategies for reducing operating costs, increasing business efficiency and improving sales and service effectiveness are of critical importance during the downturn.
Telemarketing and Sales Improvements
A great example of a company that is doing just that is a European organization that relies on a telesales group to execute marketing campaigns, identify sales leads, pass leads to salespeople and secure renewals. This company was facing a sharp decline due to the local economy and—despite losing a significant portion of its staff through attrition—was forced to institute a hiring freeze. The company continued to invest in refining its sales and marketing processes, in spite of the suffering economic climate, and as a result, it has been able to maintain its previous productivity levels (with fewer employees) and actually increase its overall lead and prospect quality.
Innoveer used a phased approach to helping the company improve its CRM capabilities, including recommending small sales and marketing process improvements and enhancing the links between sales, marketing and service activities. One specific change involved improving data quality and putting dashboards in place that simplify the ability to slice and dice data and increase the number of qualified leads with less effort.
Once the changes were deployed, this organization was able to optimize in-progress marketing campaigns, ensure that the field sales force receives only high-quality leads and minimize redundant marketing communications. These improvements not only reduced costs, but also enabled the remaining staff to maintain previous productivity levels. Today the call center is able to set up more qualified appointments for the salespeople (due in large part to a vast improvement in the accuracy of data) and members of the sales force are in turn able to have more effective meetings with potential and existing customers.
The company has also improved its sales meetings. The sales representatives do a thorough financial review and gap analysis of the customer's circumstances and then conduct a face-to-face meeting during which they offer a tailored proposal of recommended products. Because the company is now targeting prospects much more effectively and have much more reliable data to analyze and more accurate reports at their fingertips, the sales meetings are much more successful in general. Data from these meetings is then entered into the new system and newly appointed "data stewards" review the information to ensure that it is accurate, giving employees across the organization a better understanding of the customer's needs, goals and potential for future opportunities.
Productivity Opportunities Abound
Similarly, we have also been working with a professional association that now saves £2 million per year by managing its e-mail marketing communication efforts through newly-defined CRM software and business practices. The software's built-in BI capabilities have enabled the organization to more effectively segment and market to its members, generating additional revenue without increasing staff.
Even small process and technology changes can lead to large efficiency gains, cost-savings and increased customer satisfaction and loyalty levels.
In yet another example, we partnered with one of New York's largest healthcare organizations to help them introduce more modern call center processes, including replacing a triage approach, which escalated many calls to subject matter experts, with a one-call resolution model. This has enabled call center employees to resolve 99 percent of incoming calls during the first call. Back-end integration has also reduced call duration by 50 percent, and enabled online self-service portals to further lower service costs by 18 percent.
We recently worked with a high-technology manufacturer that reduced the steps its sales representatives must follow to resolve a customer call, which decreased training requirements and staffing needs by eight percent, saving them $1.2 million per year.
Achieving such results—in effect, multiplying the returns attained by any given point improvement—requires that companies constantly link their sales, service and marketing activities. Tracing these links is crucial for maintaining a single, trusted view of each account, including a customer's costs and benefits, as well as tailoring customer-facing efforts to prevent customer or prospect fatigue — all while ensuring rapid service.
Stay the Course, Take Small Steps
In all of these situations, the companies were able to achieve impressive sales, marketing or service outcomes by staying the course with their CRM investments or revitalizing and streamlining their existing programs, which is helping their bottom line today and has prepared them for success once the economy rebounds. These companies are also now in a position to actually boost levels of customer satisfaction —despite budget cuts and staff attrition —because their customer-facing processes have been fine-tuned to ensure an improved customer experience.
If an organization is hesitant to begin a large-scale project in this economic climate, even small process and technology changes can lead to large efficiency gains, cost-savings and increased customer satisfaction and loyalty levels. Beyond streamlining existing operations with small refinements to sales, marketing and service programs, in my work with customers, I have found that the biggest gains come from linking sales, service and marketing activities. Simply put, making improvements in one area often creates new opportunities for improvement in other areas.
During difficult economic times, companies want to get more from what they already have. To identify immediate enhancements that utilize existing capabilities, as well as medium-term goals that will lead to even greater cost reductions, automation and efficiency improvements, companies should:
- Conduct a CRM assessment—reconcile their existing CRM strategy with current business goals and market conditions for the sales, marketing and service groups
- Think about best practices—examine how marginal CRM investments can increase automation, efficiency and cost savings
- Do a technology review—determine whether newer technologies will decrease operational costs or if linking customer data across the sales, service and marketing groups will multiply efficiency benefits
- Come up with a game plan—build a plan for achieving short- and long-term business outcomes
Through CRM-based activities such as marketing campaign optimization, customer segmentation and targeting, lead management, PRM, customer self-service, call center automation, BI dashboards, pipeline and forecast management and maintaining a single view of each customer, companies can gain the operating intelligence they need to not just survive the economic crunch, but to thrive when better economic times return.