Three Steps to Create a Successful CRM Strategy

Building a customer relationship management (CRM) strategy is a unique process for each organization that nevertheless should always involve three key steps. The three steps needed to create a successful CRM strategy are: setting the destination; auditing the current situation; and mapping the journey to the destination.

"A CRM strategy cannot be developed in isolation. It must be relevant and linked to the overall corporate strategy, and it must build on existing sales or marketing strategies that are already in use. Following these three steps will provide a solid framework for CRM success.

Set the destination: The vision of the company and the goals derived from this vision are the intended destination of the CRM strategy. The vision will be heavily dependent on the leadership of the company and on the selected CRM strategy.

Ensure that the CRM vision is to articulate the future environment for the organization in terms of profitability and customer experience. During the initial stages of the CRM initiative — while the CRM vision and strategy are being developed — the leadership and governance structure must be agreed upon and roles allocated before it is stressed by the impact of change management upon employees.

Audit the current situation: Skills, resources, competitors, partners and customers all need to be consulted in assessing the starting point. Before beginning the CRM initiative, organizations need to identify how mature their existing approach to CRM is. Most organizations have some existing or past attempt at CRM; even if these were deemed failures, there are usually some foundations that can be leveraged rather than ignored by the new team.

Use the audit to evaluate the organization against equivalent organizations in the same or a similar industry. A competitive benchmark is an excellent way to gauge how far behind or ahead the organization is in comparison. Along with these two approaches, there are many other types of audit. Ultimately, companies should use as many of these assessment types as possible to prepare for the development of the CRM strategy.

Map the journey: The journey may take many years, and the map will change en route. It is important to plan for this before starting.

A CRM strategy explains how an organization will achieve the CRM vision. It is the integrated blueprint for how the organization will achieve its sales, marketing and customer service goals. Therefore, it must give quantitative answers to questions such as: What is the ideal customer base? What products or services is it going to sell, to whom, at what price and through which channels? However, it must also be able to give much more subjective answers to more-holistic, organization-wide questions such as: What is the best way to build customer loyalty? How will the organization connect with a customer to create a positive "gut feel"? What will drive customers to recommend the organization, brand and products to others more often to the point that they are willing to pay a premium price?

Setting the destination, auditing the current situation and mapping the journey is an iterative process that may require several revisions before a final CRM strategy is developed. The challenge is to avoid rushing the development process, as the company may be committed to many years of change.

Subscribers Are Vital For An Online Marketing Growth Strategy

Adam Singer has posted an interesting post "Subscribers Are Vital For An Online Marketing Growth Strategy" on his blog "Online Marketing Blog" where he reveals the importance of having a commuhity to your online brand.

Singer has 9 points; the details to each of those can be found at his blog.

1. The ~11% of web users who know to use RSS include the users savvy enough to be web publishers
   
   
2. You’ll become a go-to area to link to
   
   
3. Subscribers are your sneezers
   
   
4. A base of well-connected fans could very well be the cornerstone of your social marketing strategy
   
   
5. Community is what makes sites worth visiting
   
   
6. Subscribers will motivate you to create better content
   
   
7. Consolidated network presence is the most effective
   
   
8. Social proofing
   
   
9. Subscribers and a fan base make you less reliant on push PR

My Favorite is:

#7 A consolidated network presence is the most effective

A simple, effective way to have your messages make the largest impact is to build one consolidated source for distribution. Once you’ve chosen that place, focus on funneling as many people to subscribe to it as possible and make it the authoritative voice for your brand or industry. Spawn satellite networks too, but with the purpose of feeding the main hub. Don’t lose sight that the end goal is to create one popular area.

Building a billion-dollar niche company

Many leading venture capital firms from the U.S. are willing to invest in, and have begun to bet on, niche Indian players. Consider this, till five years ago an investment of $7-8 million in a niche services company, operating on an outsourcing model from India, was considered big. Today, the average size of investment a leading venture capital company makes is anywhere between $20-30 million.

This growing trend among VCs of investing in ‘niche players’, gives me a sense of satisfaction about what I ventured out to do six months back; which was to set up a company focused on ‘business/enterprise mashups’.

As an entrepreneur, I realized the potential of the 'mashup' market and set up Business Mashups LLC, to capture the exciting and tremendous business opportunity that ‘mashups’ provide. And since then, Business Mashups LLC has been growing significantly.

Contrary to what comes to mind when thinking of a ‘specialized niche company’, Business Mashups LLC is not built around a small opportunity. In fact, it is possible to build a $1 billion company in this niche segment of ‘business mashups’.

Let me illustrate my point. Once a strong value proposition is built to focus on a particular niche segment, one needs to identify an opportunity that is scalable. Here, I would like to clarify that, while in the Indian context scalability often refers to how quickly a company can increase its headcount, in the U.S., it is measured by the market opportunity the company has the potential to capture. Hence, it is required to determine the quantum of business already being generated by the big players in the niche market, as well as implementing an effective ‘go to market strategy’ to effectively compete in the market for business.

On attaining considerable growth in its industry segment, it is also advisable for the niche company to diversify into peripheral or related services. For example, a player in the ‘mashup’ market could look at providing ‘security services’ as well. Also, various niche players with related business interests could work through ‘partner referral’ programs which would enable them to offer the entire range of specialized services required by the customers to meet their business needs. The attempt here is not to expand by becoming an ‘end-to-end player’, but to grow the business, while not losing focus on one’s core service offerings. Additionally, a niche player needs to invest in, and build, new competencies in the focused areas. Success is measured by the ‘true value’ provided by the niche company’s services and products to the customer’s business, which will help retain as well as increase the client base.

To reinforce the ‘value proposition and branding’, niche players periodically need to get their messages out in the market they operate in. This could also involve ‘a re-branding’ exercise, wherein the company considers changing its logo, tagline, external and internal messaging to its customers and employees respectively. This is also a positive statement in communicating the company’s ‘key differentiators’ from its competitors and to maintain its ‘leadership position’ in the industry.

A niche player could also communicate its value proposition to its customers through new and innovative pricing and packaging. For example, a mashup firm could charge for its services appropriately, after analyzing the amount the customer currently spends on technical support (post-product deployment). If the spending is minimal, it could result in increased returns for the mashup firm. The pricing could also vary according to the number of bugs one finds in the product.

On the packaging side, one could draw up a list of ‘top 20’ functions and charge it as a package, rather than charging for all the services. For example, in the arena of security testing, this ‘top 20’ list could constitute a set of services deployed to detect security flaws.

A niche player should clearly articulate the business benefits that would accrue from engaging the company’s full services to the customer, including the ‘financial savings’ in the entire product lifecycle, rather than limiting it to specific services concerned. Experience has taught me that this is one of the strongest factors that help win and retain customers.

Niche players are extremely effective at working closely with their customers to build and maintain long term relationships by innovating and challenging the existing norms in the industry, thus adding value to the project, program, and organizational level. The best organizations in the world want to work with the best, and if you as a niche player can be the best at what you do—and this can really happen only if you focus in one area—then you will have great success.

In conclusion, I would like to add that, the toughest challenge an entrepreneur faces while building a $1 billion niche company, is to convince people to believe in the ‘value proposition of offering only specialized services’. While a niche firm often succeeds in attracting the best talent with the requisite specialized skills, it does encounter challenges to retain them in the face of competition from the big ‘end-to-end players’ in the industry. Hence, it is imperative for a niche company to consolidate its workforce with appropriate talent, value proposition, and the conviction of being a ‘big player’ in the industry, while offering them promising career paths.