The current economy is wreaking havoc with application budgets while forcing companies to wrest more value from...
their current CRM software implementations.
Against that backdrop, Scott Nelson, managing vice president at Gartner, offered a series of five low-cost CRM strategies.
"Part of this was to dispel the notion that all you can do with CRM is buy software," Nelson said. "And just because you have no approval to purchase doesn't mean you have to grind to a halt."
In fact, surveys of clients by analysts with the Stamford, Conn.-based research firm have found that the lessons of the last economic downturn have stayed with many companies.
Approximately 40% of them say they will use the economic downturn to generate post-recovery growth via effective CRM strategies.
Those figures vary widely across industries, of course. Financial services, for example, are reining in costs, while government organizations are investing heavily. Software vendors like software to track federal stimulus money. Most organizations have little to spend on things like software, but there are some exceptions, according to Nelson.
"We're not seeing people buying a whole Oracle or SAP suite, but certainly there are investments in SaaS right now," he said. "Analytics, because those are discrete investments, data clean-up and quality, some sales automation -- anything that can cut costs -- campaign management, e-commerce so they can push cost forward."
While anything relating to Web 2.0 or social networking has been the subject of buzz and marketing hype, customer communities are an effective and low-cost (or no-cost) way to engage and serve customers. Gartner recommends setting up corporate accounts on sites like Facebook and Twitter to begin experimenting.
Analytics tools that help organizations determine customer buying patterns, attrition and channel usage can be purchased at a reasonable cost, Nelson noted.
Moreover, many companies already have the tools in-house.
"A lot of clients already have made the investment in that area, and it's sitting on the shelf because they bought a package with analytics embedded," Nelson said. "This may be a good time to go out and use them. Organizations have the luxury of having a little more time available right now."
SegmentationSimilarly, because of the recession, there are fewer new application projects, and personnel do not need to devote as much time to things like proving ROI, freeing them up for projects such as segmenting the customer base. Gartner advises companies to use the time to re-examine their segmentation strategies to determine whether they're truly effective.
CRM initiatives that focused on sales, customer service or marketing left many companies with siloed, disjointed processes. The recession is an opportunity to re-examine and streamline those processes.
"Many are still thinking of sales, service and marketing as a discrete, siloed approach that does not represent the process flow of the customer," Nelson said.
Telcos are a good example, he said, where the processes are built around things like billing, fraud and equipment, and companies are now thinking about how to organize around bringing aboard a new customer, for example.
Finally, if a company has been considering moving from a product-centric to customer-centric organization, now may be the time, Nelson advises.
Does that mean the recession has actually proved a boon for advancing CRM?
"In some ways," Nelson said. "It's certainly never good from the vendors' point of view, and the drying-up of funds isn't good. But there's always been this misconception that CRM is all about buying software. There's so much more to it than the software involved."