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For Start-up Businesses, CRM Software is Not the Answer

October 9th, 2009 ::

Instead, it is the question.  Small businesses, new businesses, unintentional businesses are still looking for the answers.  When you are still concocting the winning sales strategy, determining the right pricing structure, exploring service channels and developing your company’s voice, you can’t plug a handful of purchased leads into a preexisting  sales pipeline and expect a reliable return.  When your business is growing  1 or 10 or maybe  100 customers at a time, you need to be able to follow each relationship where the customer leads it.  Not where the software dictates it go.

At this stage of the game you need to understand your customers including who they are, why they buy your product, how much they can afford to pay for it, when they like to use it and why they tell their friends about it.  Then you can start determining some sales and marketing strategies.  If you are selling kids clothing online, you might see your mommy customers spreading the word on Twitter. If you are selling live bait to seasonal  tourists, Twitter might not be the way to go . There are no magic growing beans for new businesses.  The fun part is figuring it out as you go.

With this in mind I have a few suggestions for building a small business CRM (customer relationship management) tool  that will grow with your business:

-          Collect as much information as you can about your customers.  At every point of contact reach out to them and be sure to save every nugget of information they are willing to give.  Have an e-mail list sign-up in your retail shop. Keep detailed records of all purchases and decisions behind them (how they found you, what they bought etc).  If they send an e-mail to your support team, add their signature data (phone number, address, company web site etc.) into your CRM as part of the  logging process.

-          Ask for their personal or business web site address.  Or glean it from any e-mail messages sent in to your sales or support teams.

-          Periodically surf the web sites of your best customers and collect any information that might be helpful market research (their business type, location, personal interests, etc.). Save it all in your CRM system so that you will start to notice trends (my 9:00 AM coffee clients are apparently all chess players, all our customers in Australia are service businesses, etc.)

-          If they include any information about social media profiles, capture that in your CRM.  Look for a link to any blogs they contribute to, their Twitter account, their LinkedIn account, etc. You may not be networking in social media, yet, but when you do it will be nice to have some friends there to reach out to. And it is a great way to learn more about the things your customers want you to know about them.

-          Periodically survey your customers or potential customers about your product or service.  Limit the demographic questions to 1 or 2 short questions (i.e., “what type of business”, “annual sales”, “number of customers”, etc.) and have the rest of the questions focus on ways that you can help them (ie feedback on your product, pain points they are experiencing, ideas for new features, etc.).

-          Keep your data clean.  Right now it might be easy to scan an excel spreadsheet and read through the business categories your survey respondents typed in themselves.  But if you make that field a multi-select form (rather than a text field) in your web form then you will be able to more easily spot trends over time as you slice and dice your data with custom reports and graphs.

-          Integrate your CRM with as many of your other applications as possible – with your mobile phone, your e-mail software, your invoicing software, your web forms, your shopping cart software, etc. You do not have time to do double, triple, quintuple entries for your growing network. And it is helpful to know that John Doe bought one of your products, but the real insight comes when you see that he has bought the same product every quarter for 3 years, always pays promptly, has recommended it to his friends on Facebook, always reads your newsletter and rarely needs customer support.

I’m Pamela O’Hara (@pmohara on Twitter) the co-founder and owner of BatchBlue Software, the maker of BatchBook small business CRM product and host of #SBBuzz, a weekly Twitter chat discussing small business technology.  We’ve designed our  CRM product to be as flexible and agile as the entrepreneurial businesses that are using it. We understand the importance of a CRM solution that helps you ask the right questions and manage the answers.

The views expressed here are the author's alone and not those of Network Solutions or its partners.

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Posted in Business Development, Entrepreneurs, Marketing, sales process, small business, social media, Technology | 8 Comments »

  • http://freecrmstrategies.wordpress.com Brian Vellmure

    Pamela,

    Good article – a ton of helpful tips and nuggets in here. I agree and would argue that the software is NEVER the answer for ANY SIZE company.

    However, as you point out, it can and should become an invaluable tool for enabling the growth of SMBs.

    New companies have a great advantage of building a system the right way from the start (instead of trying to fix things down the road).

    Creating a culture and associated business processes around capturing and leveraging the right information to help build meaningful long term relationships – to find, acquire, and keep the right customers so that you can wow them to the point that they tell their friends and colleagues is the key!

    While critical at the start, the system becomes even more important as your business grows and scales. Enabling “1 to 1″ conversations when you’ve got multiple offices, departments, and touch points relies on a system that helps to capture and make accessible the right information at the right time.

  • http://michelchiasson.wordpress.com Michel Chiasson

    Good article Pamela. While I agree that for the most part a crm is not ideal for startups, I differ in the reasons why I agree with you. While you state that early on, more time should be spent understanding the makeup of the decision making process of the customer and its profiling, I think that the reason why a crm is not well suited for a small business is that it takes time. Time out of the sales process, time out of the “making sure that this one new client is happy” process…time out of the business..which, when you start, is so critical.
    Honestly, if one launches a business and doesn’t know the profile of their customers and what motivates them, they might never need a CRM as they will be gone before the very problem hits them. I went to your site and read about Batchblue. I would probably push it on customers earlier than you would, but on a module by module basis, so that they can leverage some of it benefits, while not choking the small new org that has to focus on dollar activities. My 2 cents :)

  • http://you-read-it-here-first.com John Bailo

    I would also say that in the early phase of customer acquisition you resist the impulse to put everything in a table, or database. At the point you start deciding on field names, you’ve limited the types of data that you want to track…that is something you might do in a mature stage.

    Alternatively you could follow a methodology of customer “stories” more akin to social networks. In other words, write essays about your customers, use text descriptions and histories that don’t pigeonhole people.

  • Anonymous

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  • abassseo

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  • abassseo

    Affiliate Marketing is a performance based sales technique used by companies to expand their reach into the internet at low costs. This commission based program allows affiliate marketers to place ads on their websites or other advertising efforts such as email distribution in exchange for payment of a small commission when a sale results.
    http://www.onlineuniversalwork.com

  • Intelestream

    It is important for small businesses to use management software if they want to grow and compete with their larger competitors. Customer Relationship Management (CRM) is an important business concept that puts the customer at the center of all interactions and its payoff is high, allowing your business to be more productive in many ways. Applications can be accessed online, with a web browser and an internet connection. Intelestream has developed intelecrm (www.intelestream.net/intelecrm), an online CRM solution that specifically targets small and medium sized businesses. The pricing model is unique in that subscriptions are based on a flat fee for unlimited users. This means everyone in a small business can be actively involved with the CRM, creating a powerful tool across the whole company. A free trial can be acceded here http://www.intelestream.net/lp/lp-intelecrm-free-trial2.html.

  • Intelestream

    It is important for small businesses to use management software if they want to grow and compete with their larger competitors. Customer Relationship Management (CRM) is an important business concept that puts the customer at the center of all interactions and its payoff is high, allowing your business to be more productive in many ways. Applications can be accessed online, with a web browser and an internet connection. Intelestream has developed intelecrm (www.intelestream.net/intelecrm), an online CRM solution that specifically targets small and medium sized businesses. The pricing model is unique in that subscriptions are based on a flat fee for unlimited users. This means everyone in a small business can be actively involved with the CRM, creating a powerful tool across the whole company. A free trial can be acceded here http://www.intelestream.net/lp/lp-intelecrm-free-trial2.html.