THE CRM specialist portal
around Customer
Relationship Management

With the portal, we want to show a few tips and suggestions for the important challenges around the topics of CRM strategy and the use of CRM software, as well as fill it with high-quality content. Of course we portray a lot of tools.

Both the CRM system landscape and the individual, special CRM systems are important to us. This is our hook.

It is particularly important to us that users receive tips on the selection, implementation and application/use of a CRM system. Always with a view to the large and entire system. This is the only way to avoid wrong decisions and dead ends.

And the managers or executives receive impulses as to why many things change through customer relationship management or the introduction of CRM software. And we exchange ideas and give examples of best practices on how to make good things better – whether with or without a CRM system or tools.

The combination of strategy, leadership management, process thinking, CRM software, and a view of the system landscape makes things complete. It has one advantage: Because none of the departments can be decided without the other. Marketing cannot be done without sales and vice versa.

The main thing is that the manager and his team are customer-oriented with their business!

Classic questions are:

Why a CRM software implementation – whether you like it or not – changes a lot? How can this software investment in a CRM system benefit the user/user? How can the use of a CRM system bring benefits to the user? What does customer-oriented leadership mean? How does the manager become a leader? What changes with the use of a CRM system or complementary tools from the CRM and MarTech world? Which advantages arise when decisions are made sustainably?

Customer relationship management and customer loyalty are first and foremost strategic issues for a manager and his team. Only when the strategy, the measures have been formulated, then CRM software and system requirements are derived from them.

The blanket view of a digital transformation is too general, compulsive and not target-oriented enough for us. We prefer to look at everything from the perspective of the prospective customer and customer. Tools must have a benefit for the user and the customer. As a Vodafone manager once said: “Digitizing a shitty process does not change anything in business. It remains a shitty process.

Our core project is to provide answers to known and not yet asked questions.

CRM: The definition created by the author in 2012 for the German Dialog Marketing Association (DDV) for the Council Customer Relationship Management and somewhat updated for the book “Digitales Dialogmarketing” (publisher Heinrich Holland, GablerSpringer Verlag 2020) reads:

CRM is a holistic approach to strategic and operational business management.

On the basis of a CRM strategy, a company controls, integrates, and optimizes all stakeholder- and customer-related processes in marketing, sales, service, customer service, product management/purchasing, logistics, and research and product development across channels and departments. All measures, tasks and decisions are based on a target group and customer value analysis. Target groups and customer segments are defined, to which the entire organization is aligned. This organization is then primarily no longer aligned “by function” but “by customer group” (this form of organization is called customer management). The maintenance of the relationships is supported on the basis of a database suitable for the company or a corresponding software landscape.

In summary, CRM pursues only a few goals: the best possible customer satisfaction, a high level of emotional customer loyalty, an increase in the duration of relationships, and an increase in their profitability or maximum utilization. In a nutshell, CRM in the context of business relationships means creating added value on both the customer and the company side. Only if this balance is right will the relationship last in the long term and the company derive sustainable profits from it.

Helmut Schmidt, the former Chancellor and former co-editor of DIE ZEIT, was fond of saying in his lifetime: Anyone who has visions should see a doctor.

This crisp saying from “Schmidt Schnauze” certainly exaggerates the subject. The question is the Why (see Simon Sinek) or “What are we doing this for? Others call it “Purpose”, currently a fashionable word.

A far-sighted idea is important because

Organizations without a corporate vision may be running towards an annual target, but they lack a view of the “big picture” – the big picture. A clearly defined vision helps to fix the point on the horizon, from which the planned goals can be derived and the resulting measures taken.

Antoine St. Exupery put it very nicely:

“If you want to build a ship, don’t drum up men to fetch wood, assign tasks and divide the work, but teach the men the longing for the wide, endless sea.”

All employees need a customer-oriented manager / leader, a central idea or vision,

which must be followed. The “What am I doing this for?” is certainly a very good translation of the term “Why” that Simon Sinek coined. It is from the “what for” that the culture within the organisation is ultimately derived. How do you deal with interested parties, customers as well as suppliers or partners. The interaction with its stakeholders is based on culture. And if it is customer-oriented, then the signs are success and satisfaction.

A corporate vision is the starting point for cascading into the various levels of practical implementation: From corporate vision follows the mission, motivation, strategy and action plan.

Conversely, this means that if you don’t have a manager / leader and a company vision that the employees follow, the employees will consequently define their own vision. They derive their own motivation for using the CRM system from this vision. In the implementation – here also in the use of a CRM system or entering data into the CRM system – this is an important basis.

Ergo: A visionary central idea is needed that is made known throughout the company through internal marketing.

A law of nature says: About 10 % of the employees should follow you or your company vision and guiding idea.

In nature research one speaks of the following initial situation: If about 10% of the animals follow a leader, then the rest of the herd also follows. And if about 10% of the animals do not hesitate to follow the leader, but follow him enthusiastically, the rest of the staff will follow empathically and with commitment. This is a huge USP or advantage for a company.

If this is not the case, as the Gallup study shows each time anew, then more than 80 % of the employees are just there, but do not follow suit. In this case, the team is not headed by a leader, but only by managers and custodians. Advantage or opportunity lost.

Although everyone says, and this is confirmed by the information from the Muuuh Group study, that CRM is not a software topic in the foreground at first, but rather a strategy topic. But only few managers in a company live this credo in practice. At least, the other results of the Muuuh Group Study show that the respondents themselves recognize major discrepancies between “The topic is important” and “That’s the way it is with us”.

More informations about leadership you can read here.

Why is that so important? If you simply manage your employees nowadays, not giving them any responsibility, you will get into difficulties with the current change over time. Leadership goes far beyond better human resource management. It is about the common goal, the orientation of the company towards customer groups. This requires not only good managers, but a management team that is a “good leader”.

Employee leadership is also extremely important when using software. Most CRM solutions are not used to the extent that they could be used. As a result, the expected benefits do not arise. The investment becomes a bad investment. This does not have to be the case. With our knowledge and expertise of the challenges involved in a CRM software implementation, we can make this investment a success.

The term loyalty flywheel may well be new to many of you and therefore needs to be explained. When you hear the word loyalty, the first thing you think of is constancy. A flywheel triggers dynamic associations. But that’s exactly what it is: Loyalty built up over many years of cultivating relationships with customers, giving them a new dynamic. How does that work? By strategically expanding the service and product portfolio.

The rule of thumb “Winning a new customer is 5 times more expensive than retaining an existing one” is not new information, but …

has been accepted by many managers (or should we rather call them leaders?) That’s why they have a clearly defined purpose: to build a sustainable business model based on lasting customer relationships and to increase the profitability of these relationships. This increases the value of the customers and, accordingly, the company. This also changes an outdated way of thinking: “I have a product/service idea. Who can I sell it to” into the new thinking “I have good relationships with customers. What else can I sell them?”. This paradigm shift means in plain language an important message or information: Product management is dead! Long live customer management.

One of the best known examples of a loyalty flywheel strategy is Amazon

Let’s look back a few years to the beginnings of Amazon: When it was launched, the company initially pursued the strategic goal of building customer relationships with a frequency article (as is well known, it was books) that appealed to a broad mass of people.

From the resulting mass of customer relationships and an incredible amount of information about the customers, an intelligent product range enrichment or cross-up selling has grown into a full-service provider in the e-commerce sector. In the meantime, many customers are so firmly bound to the “Amazon” brand that they buy “virtually” everything – even fruit and vegetables – from the international group.

The growth of Haufe is unique in the publishing industry

Haufe – a provider of specialist information – realized in the 1990s that it could not continue to exist by simply offering loose-leaf publications in the context of the ever-increasing digitization. At that time, the software house Lexware joined the Haufe group of companies, which has since been renamed. Through the consistent reorganization and alignment of goals, tasks and processes to the defined customer groups, the Group successively expanded its portfolio of products and services (also through targeted acquisitions) and was thus able to benefit from the appropriate attractiveness and loyalty of its customers. Today, Haufe generates 95 percent of its sales with digital products such as online services or apps. In 1990, the Haufe Group reported a turnover of 50 million euros according to its own figures – today, the figure is just under 300 million euros.

Tchibo has also made a virtue of necessity.

At the end of the 1990s, a price war began in the coffee segment. The reaction of the coffee supplier, namely to buy the toughest competitor, Eduscho, did not solve the problem. The world market price for coffee came under increasing pressure, making profitable customer relations or sustainable corporate development virtually impossible. In 1999, Dr Thomas Vollmöller became Managing Director of Tchibo. The manager, who is now CEO of XING AG, thus wrote an unprecedented success story.

His basic strategic idea: “Every day, at least every week, millions of people come to Tchibo stores. What else can we sell them?” Tchibo’s analysts then analysed the existing target and customer groups and used market research to clarify what else might be interesting for these people to buy besides coffee. This gave rise to the motto “A new world every week”, under which Tchibo offers its customers new consumer goods on a variety of topics every week. All in all, it is a strategic masterstroke to lead a business model that has come under pressure into a successful future on the basis of existing customer relationships.

What are other examples of customer loyalty through the loyalty flywheel principle?

Other successful examples of the loyalty flywheel are the ADAC, which has developed from a club into a commercial enterprise. Glöckle Lottery sells electricity via the E.Vita brand. Or the power tool manufacturer, which now also sells jewellery and cosmetics to its craftsmen for their wives.

The approach of a plastics industry company is particularly unusual in this respect. If a customer wants a certain product, but cannot deliver it himself, this product, which is currently missing in the warehouse, is bought on the market from the competition or from the dealer and sold to “his” customer. In this way, the customer remains in possession of the customer relationship.

Abstractly, these experiences can be mapped into a strategy with a loyalty flywheel (see figure). In the middle (at the core) lies the existing customer relationship. And now, after the actually banal idea of cross-selling and up-selling (which is backed up by strategic category management) comes the question: “What else can I sell to the customer and in what order? In this way, more and more additional, complementary product ranges are created. Everyone should make sure that they have customer confidence in these products and services. Is the brand already strong enough to withstand this “stretching”.

The flywheel symbolises the positive forces of an outward movement,

which creates more and more dynamics – for example, by making existing customers buy more, but also adding more new customers.

According to Dr. Vollmöller (former Tchibo), Mr. Reithwiesner (Haufe-Lexware) and our experience, the great challenge is to trigger this dynamic in all employees and keep it going through a CRM strategy, customer-oriented culture and philosophy.

Getting the loyalty flywheel and thus the employees moving or keeping it running with positive energy is a management task which we would be happy to discuss with you and in which we provide you with optimal support. So do not wait until the business model comes under pressure. Instead, let us define the necessary management tasks and goals together and implement them with your team!

Are you curious?

Are you interested in a customer-centric, dynamic company development through the loyalty flywheel? Our customers already call this flywheel strategy a megatrend. So don’t hesitate too long to contact us soon!

In the FAZ of 26.04. Alfons Kaiser (2014) writes about the dissolution of the fashion company “Firma”. Among other things he sums up “Many young brands have not survived the stormy start of the past decade.

This shows an often misused term of brand. Founders believe they are a brand from the very beginning. New products are advertised with multi-million dollar budgets (mostly via TV, radio and digital mass advertising) in the hope of becoming anchored in a customer’s relevant set. Nothing happens without quality promises and building consumer confidence that the quality is there for the long term.

Far from it: You only become a brand with time, with increasing awareness, sympathy – once you have achieved market recognition. “In black and white terms, you are a brand or not.

That’s why the road to a brand is usually rocky and takes years. The example of Beck’s beer shows how long it takes until a brand or the new positioning is anchored in the minds of the vast majority of the target group: it took ten or more years until over 70% of the target group at “green ship” and “sail away” associated Beck’s beer.

Brands such as Nivea, WMF, Bosch or Siemens today have a brand awareness of over 95%. These are exceptional values. These brands are all over 100 years old and well maintained. How difficult it is to become a brand is something that long-standing market participants feel when, despite great efforts, they are only in fifth place or worse in the industry league.

From a CRM perspective, dialogue, interaction, action and reaction play important roles. For a long time, all target groups were advertised with classic advertising. At some point, the advertising companies realized: Their advertising is less and less effective.

Industries such as mail order and multi-channel commerce showed the way. Direct advertising, dialogue and interaction showed a better budget efficiency. Thus, many discovered the methods and ideas of CRM for brand building and brand management and used them in their current facets.

It’s not just a matter of being known and liked by as many people as possible, but first and foremost by the most precisely defined target group. This significantly narrower definition for advertising measures enables the advertiser to turn an unknown product into a brand or create a brand through customer relationship management.

Classical questions about this are:

How do you become a brand? Can CRM as a strategy or a CRM system help? Is CRM urgently necessary? CRM and brand, how are these two topics related? Are they two siblings who cannot do without each other or are they two sides of the same coin? Is CRM a means to an end? Can CRM make a brand or can a product become a brand without CRM? Who came first, the brand (egg) or the CRM (chicken)?

In the more detailed chapter (here the link) the author would like to work on some aspects and theses which are related to brand, brand building, brand management and the necessary prerequisites, support, supplementation as well as dependency through CRM. Some mutual complements or synergies and important differences are worked out.

There are many good approaches to customer orientation. Creative customer loyalty programmes have been launched and expensive call centres set up. The CRM system was introduced with a lot of effort and customer satisfaction surveys gave good marks. Nevertheless: The sales and earnings rocket simply won’t take off.

Why do almost all companies still drive with the handbrake on? Because sales, marketing, customer service, purchasing and product management work side by side instead of together.

Conclusion: A function-oriented organizational form can never be customer-oriented. The detailed derivation and justification will be posted here elsewhere in the coming days.

Customer relationship management is the roof, the framework. Customer Experience Management, on the one hand, is the one customer experience that was triggered by a CRM campaign. Since the prospect and customer usually has contact with the company not only at one, but at several contact points (customer touchpoints), the whole is subsumed in the customer experience.

The customer experience as a whole is therefore the sum of all positive and negative experiences of a customer. It is then subsumed in customer satisfaction. One thing is clear: customer satisfaction is much more important than the well-known Net Promotor Score (NPS).

The user experience is the enthusiasm of a user who finds a software great when using it and therefore considers it a useful tool.

Not only the customer, but also a product, the IT landscape or a CRM system have a life cycle.

Phase 1: The selection

Phase 1 of the cycle begins on the greenfield site. A company starts by selecting one or more software products. The Americans call this the greenfield approach.

How a selection for a CRM system is carried out is described on this page by www.crm-tech.world.

Phase 2: Introduction (implementation)

The introductory phase is not very popular. Usually this is a project with a huge additional burden for the project members. Whether ERP, CRM system or both in one, these large projects usually take months or even years. That tires me out. Here, external support is worthwhile, because the employees should neither do their daily business nor the project tasks on the side.

How an implementation of a CRM system works, we describe on this page of www.crm-tech.world.

Phase 3: The application

After the implementation of the selected software, the daily work with the software begins. Usually there is a continuous development. And at some point the user comes to the point: the user does not want to continue working with this tool. Or the manufacturer makes a release change or discontinues maintenance. After that, or possibly already with the announcement of the expiration of the maintenance contract, the team switches to the reorientation phase.

Which challenges and problems occur within this phase are described on this page of www.crm-tech.world.https://www.crm-tech.world/software-auswahl/

Phase 4: The strategic reorientation or adjustment

Reorientation or adjustment means that the company thinks holistically about what the IT landscape of the future will look like. When serious elements or building blocks need to be replaced, it makes absolute sense to think radically. What else can be replaced? Where, for example, can a new software replace several, smaller products? Or vice versa, how can several specialist suppliers replace a large inflexible solution?

We call this creating a Big Picture. First of all, we don’t focus on the software products, but on how the business and offering models change. What current and future strategy is the company pursuing? What requirements for processes and the resulting demands on the IT or IT product landscape are derived from this?

Only when this big picture is clear can the selection for a replacement or addition take place.

The bridge between leadership, management tasks and operative CRM in connection with customer relationship management systems can be easily built. A modern CRM system with many new CRM functions is like learning a new musical instrument.

It is a question of leadership understanding and leadership style whether a CRM software is successfully introduced or not. If the advantages of the CRM solution are not recognized and lived at management level, then this is a bigger problem.

Top management or even leaders have a role model function that they absolutely must follow. Customer relationship is a task for everyone in the company. That is why the C-Level Group must not be allowed to withdraw from its responsibility. And this applies to small companies, medium-sized companies and large enterprises alike. The whole company is changing through CRM. The entire organizational structure is being aligned to this focus “customer”. No stone is left unturned.

Note: This is a machine translation. It is neither 100% complete nor 100% correct. We can therefore not guarantee the result.