CRM for Small Business

Small business owners are realizing the benefits of running a successful customer relationship management (CRM) campaign. This article will articulate some of the CRM best practices for small businesses and it will also give a brief review of some of the best packages available.

Best Practices

1.    Realize that CRM is not only a technological movement. Many people credit Siebel Systems for coining the term “CRM.” The truth is Siebel probably was one of the first to start making the term popular. Because Siebel is an IT company this led, and continues to lead many people to believe that CRM is an IT initiative. The result of this is that many organizations go out and buy an expensive CRM package, force it into their current system, and are disappointed by the results, or lack thereof. If your company is already mishandling customers, then gathering more information about how you are mishandling customers is not going to help. You need to change your overall strategy.

2.    Develop your strategy first. This advice is almost becoming cliché in the business world, but the truth is that most businesses are still failing to do this. If you’re a new business, then determine which customer segments you want to target; then get a plan in place to acquire new customers and a plan to keep them coming back. Once you have your strategy razor sharp, then look for an IT solution that fits with your strategy. If you’re a company that has been around a while, take some time to fine-tune your customer relationship strategy. Get your strategy firmly in your mind before even thinking about CRM software. Too many companies look for a strategy that fits their IT instead of IT that fits their strategy.

3.    Find out why your customers leave. This is a very pragmatic practice that most small companies forget about. It’s easy to forget when you’re small because you are focusing on so many different areas of the business. Simply set up some sort of email or phone-calling system that will allow your company to find out why customers are leaving. Many subscription companies will ask when the customer is cancelling. However you decide to do this make sure it is unobtrusive. Just ask the question and write down their answer, do not try and argue the customer into staying. Remember this is an information gathering step that will allow you to avoid the same mistakes in the future.

This step is a lot more difficult for companies that aren’t subscription based. If your customers don’t have to cancel a subscription to leave, they simply have to never come back, then you’ll have to do some extra work. This involves tracking their visiting and purchasing patterns more closely. If you had a customer that used to come in every week and you haven’t seen them for a few months, it’s pretty safe to say they have left you. A lot of companies use customer reward cards to track customer information more carefully.

4.    Get a team together. With a small business it isn’t as important to make sure upper-management is on board. Chances are upper management is the one pushing this project. However, it is more important for smaller companies to get a team together (often due to the lack of employees managers try and make this decision by themselves). You’ll want to select employees from sales, customer service, and marketing at least. Your sales team will have valuable information about customers and they will also tell you what information they need to be able to make more sales. This is invaluable when trying to decide which CRM software to purchase. Customer service needs to be involved as well because they too will provide information about your customers. Get your top employees from key areas to help you set the strategy and determine which CRM package to purchase.

5.    Know who your customers are. Although this is more of a problem for larger businesses, sometimes it can be difficult for a small business to remember or identify who their customers are. Is it the end-user or the retail store who actually buys your products? The truth is it depends on your strategy: some people market to the end-user while others focus on the retailers/wholesalers, some people do both. Who is your customer?

6.    Know the basic human need you fulfill for your customers. Do you make your customers feel happy, secure, peaceful, excited, or thoughtful? Do you save them time? At the end of the day, humans are just walking needs, and it is your responsibility as a business to fulfill one of those needs. As you do, your customers will keep coming back.

Something interesting here is that most small businesses fail to think about the actual human needs they are fulfilling. If you were asked about what you provide for your customers, what would you say? Most managers will respond by saying “blue widgets” or whatever your product or service is. The truth is customers don’t need blue widgets, they need whatever emotion it is that they derive from the blue widgets.

7.    Classify your customers into segments: Extremely Profitable, profitable, and needs improvement. This is another step that isn’t difficult, but a lot of small companies fail to do it. There is the classic 80/20 rule that twenty percent of your customers provide eighty percent of your profitability. Know which of your customers are profitable and treat them differently in all phases of your corporation. You should assign them the most experienced sales reps and customer service agents. Your profitable customers shouldn’t have to wait as long for support as other customers. Below is a diagram that shows how you might want to consider handling your different types of customers.

Take special notice of the Up or Out group. This is another area where small business owners often fail. They are afraid to get rid of unprofitable customers. The best way to do this is to be honest with them, something along the lines of  “Our current relationship is not good for my business. I want to keep working with you, but to be able to continue to provide you quality service I’ll need you to …”. Another excellent way to get rid of unprofitable customers is to refer them to your competitors. Say something like, “We can no longer provide your these services at this rate; however, we recommend visiting XYZ corporation (your competitor) as they also provide these services.” This serves two purposes: (1) your unprofitable customer doesn’t feel like you are firing them, they simply feel like you are recommending them a service that fits them better. (2)You hurt your competitors by giving them unprofitable customers. Don’t feel too bad about this, they are probably doing the same thing to you.

Best CRM Software for Small Businesses

SalesForce: Salesforce is a very well-known CRM company. They are used by Fortune 500 companies like Dell Computers, but they are also used by many small businesses. One unique feature that SalesForce has is a contact management system that works through WordPress. The WordPress platform is the most popular system for small businesses. Props to SalesForce for understanding their customers and providing an easy-to-use plugin that will help increase sales from your website.
SalesForce has some very affordable CRM options depending on your needs. They have $5 per month contact manager, a $25 per month Basic CRM package, and a $65 per month professional package. These systems and prices are definitely geared towards small business.

If you want a lesson in how to develop customer relationships on the web, take a look around salesforce.com. These guys know how to close sales and maintain customers.

FreeCRM.com:  For those small business owners who just want something that is free. This CRM system allows up to 5 users with 10 MB of storage. After your business grows out of the free version you’ll have to pay around $35 per month. This is a good program and a lot of people have enjoyed it.

SalesNexus: SalesNexus is another great crm package for companies with employees numbering anywhere from 5 to 5000. This package was developed by salespeople which means that it should have the features your sales team wants and needs. It is an online package which means you don’t have to download or install any software and you can access it from anywhere as long as you have your user-name and password. Another advantage of purchasing an online system is that you never have to worry about upgrades. The company automatically does these upgrades for you so you don’t have to worry about conflicting systems; which can be an absolute headache for small business owners.

Another great thing about SalesNexus is there support. They offer unlimited live training, phone support, email support, and online chat which is a handy little feature. They also claim to have the best response times in the industry.

Other programs to consider include Infusion Soft, Microsoft CRM, and Prophet.

Hope you have enjoyed this little segment on CRM for small businesses. Please feel free to comment below on any experiences you have had with the software above. In addition please add other software that you think would be valuable for our readers.