Many companies are buying into the notion that building a robust Customer Retention and Management System (CRM) can pay significant dividends in increased sales and profits.
In fact, a recent survey by this newsletter's parent, Information Strategies, Inc.(ISI) showed that one out of four respondents said they had installed or were considering a CRM system for their firm.
Larry Caretsky is President of Commence Corporation, a recognized leader in this area. He offers the following seven suggestions on what to look for and at, when choosing a CRM system.
- Know your requirements beforehand: Don’t make your selection of a CRM solution a beauty contest. Take the time to document the core requirements that you are looking for and make sure you fully understand the workflow of your internal business processes. Smaller businesses tend to lose site of this during the evaluation process and become too focused on cosmetic appearance and price. As a result, they are often disappointed in the products inability to support the unique business requirements that were not part of the initial demonstration.
- Where’s my data? Your customer information is your lifeline. Without it you’re out of business. Don’t be afraid to ask where your data is being hosted and by whom. Most vendors utilize a third party service to host your data. Ask who they use and check into the company’s track record for performance and reliability. You may also want to inquire about back up and recovery along with their procedures for obtaining your data should you discontinue the service. This is one of the most important yet overlooked aspects of your decision process.
- Scalability: Your business is going to grow. If you didn’t believe this you wouldn’t be in business. Consider selecting a solution that offers a comprehensive set of applications even if you are not planning on purchasing or utilizing them today. Switching to an alternative solution provider to attain additional functionality can be a costly and disruptive exercise in the future. In addition, you may want to make sure the solution you select performs efficiently at two to three times the current number of end users you plan to have. You may discover that the basic lower cost solutions designed for small businesses may not perform well when pushed to higher utilization levels.
- Back-end integration: While this may not be your top priority, CRM is the front-end to all back-end processes and sooner or later you are going to want to integrate customer data with your accounting or ERP system. Make sure the vendor you select offers an application programming interface or API that enables back-end integration.
- Select a partner not a vendor: If you are making a decision to implement a CRM system because you’re committed to becoming a more effective sales and service organization then you need to select a partner and not a vendor. A partner will provide you with a proven implementation plan and best practices to ensure that you realize the maximum value from their solution. A vendor will enroll you as a customer, then suggest you send an e-mail if you require help. CRM is not a toy and you will require professional training and assistance from time to time. Select a partner who has a solid track record for providing this level of support.
- Stay away from free: Nothing good comes out of free. Not good products and not good services. A world class product from a trusted solution provider who can protect your data with a reliable hosting service, provide a high level of performance, offer scalability and growth, enable back-end integration and partner with you to ensure your business objectives are met isn’t cheap and doesn’t come free. Selecting the right solution provider is an important decision for your business. Make the above criteria part of your evaluation process. You may discover that the difference between a top rated trusted solution provider and a low cost one may be just a few dollars a month.
- Select a mature solution provider: With today’s economic uncertainty, it’s extremely important to select a solution provider with a trusted reputation and long-standing track record for delivering high quality products and services in your industry. There are no guarantees today, but a company that has been in business for a decade or more with an established customer base is clearly a safer bet then the one that’s just getting started. It’s also a good idea to research the vendor’s customer base and ask for references that can discuss the provider’s commitment to quality customer service and product enhancements.