A good relationship with your customers is the key to retaining them in the long term. The competition, however, does not sleep and is only a mouse click away. Good customer management is essential if you are to succeed. So what makes for good customer management? This article will share all you should know about customer management and how it can help your company.
How do we define customer management?
The term “customer management” refers to the implementation of targeted measures to improve a company’s customer orientation. It focuses on systematically improving customer satisfaction, increasing customer loyalty and enhancing customer value. Customer management is often used as a synonym for customer relationship management.
What is meant by this is the complete orientation of a company to the needs of its customers. In customer management, software solutions such as CRM systems are often used to manage customer data and business relationships.
What is the importance of customer management?
Customers are a company’s most important asset, along with its employees. Ultimately, they decide on the economic success of your company. You can boost your company’s success by aligning your products and service with your customers’ needs.
Furthermore, it is considerably cheaper to persuade existing customers to make a further purchase than to acquire new customers. Good customer management ensures that you exploit existing customers’ sales potential and reduce your costs. Thus, you confirm your company’s continuous growth.
The Four Cs of Customer Management
Customer management has four aspects: customer orientation, retention, satisfaction, and value.
Strong customer orientation leads to higher customer satisfaction. A high level of customer satisfaction strengthens customer loyalty. A high level of customer loyalty increases customer value in the long term. Higher customer value, in turn, leads to increased sales in your company.
1. Customer orientation
The foundation for successful customer management is targeted customer orientation. That means the customer is at the center of all activities and business decisions. To focus on your customers, you must know their needs and wishes. The simplest way to find these out is to conduct a customer analysis.
A prerequisite for this is access to all critical customer data and information about your customers, for example, via a CRM system. Once you have successfully analyzed your customers, you can adapt your offers to their needs.
2. Customer satisfaction
When your customers are satisfied, they will buy from you in the future and recommend your company to others. Therefore, it is important to meet the needs of your customers. Customer satisfaction will increase if you meet your customers’ expectations or even exceed them.
Good communication is crucial to this. Customer surveys, for instance, allow you to identify potential problems early and actively take action to address them. A good customer management system also includes a well-thought-out complaints management system.
3. Customer loyalty
The main aim of customer retention is to encourage your new customers to make further purchases and to bind them to your company in the long term. The aim is to expand your core customer base and keep them from leaving for a competitor.
This includes reactivating inactive or former customers with targeted campaigns. Customer loyalty can therefore exist legally, for instance, through contracts, technologically, technical expertise, and psychologically, through emotional attachment.
4. Customer value
Not least, the aim of successful customer management is also to increase customer value. But what is customer value? The customer lifetime value is the average value a customer brings to a company during a long-term customer relationship.
Different customers have different customer values. Calculating this value helps you to differentiate and segment your customers. Knowing the respective value, you can focus on your most profitable customers. This way, successful customer management allows you to better allocate your resources and pay more attention to the right customers.
So what do you need for successful customer management?
In the following, we will discuss what you need to have successful customer management in your company.
Collection of data
The fundamental requirement for professional customer management is your customer data’s central collection and availability. Orders placed to date and all information about the customer can be stored via a CRM system, for example, and accessed at any time and from any location.
Quality of data
Besides the availability of your data, their quality is also crucial. Gaps and obsolete or incorrect data lead to dissatisfied customers. For example, using an outdated address in online shipping results in a poor customer experience. Even marketing campaigns cannot be played out correctly if data records are incorrect.
Consistent sales process
To make your customers feel well taken care of and to build a relationship with your customers, you must have a consistent process for your customer care. Who’s responsible for which customer? At which point in the customer journey is the customer at the moment, and what information do they need?
With a structured sales process, you’ll focus better on your prospects with potential and be able to work more productively. Suppose your sales process is mapped in the CRM system. In that case, each employee can view the current status of the customer at any time, for example, past phone calls, e-mails, areas of responsibility, contracts, and the current sales phase.
Analysis of data and forecasts
Effective customer management includes not only a 360-degree view of your customers but also comprehensive analyses as well as sales and distribution forecasts. Using a CRM system, customer analyses and forecasts can be viewed directly in the system. Thanks to the graphical presentation, you can recognize current developments at a glance and react quickly in the event of changes.
Professional customer management also includes the fast and structured processing of incoming complaints or claims. A CRM system with convenient service features can also help here.
You can respond efficiently and quickly via a support ticket system with automatic prequalification and categorization of service requests. You can also use the incoming complaints to identify potential for improvement and product optimization.
What are the benefits of customer management?
- Customer centricity: With customer management, you place your customers at the center of all business activities and create customer-centricity.
- Building and stabilizing customer relationships: with the right customer management, you can keep an eye on all developments at all times and build long-term customer relationships
- Increasing customer loyalty: When your customers feel they are in good hands and well taken care of, it prevents them from churning to competitors.
- Increasing sales: professional customer management with well-thought-out customer segmentation also increases your sales in the long term and lowers your sales costs.
Conclusion: Customer management as the starting point for long-term customer relationships
Customer management today involves much more than just maintaining customer data. Customer quality, analysis and structured processes are crucial for good customer orientation.
If the customer factors and management are right, it can build long-term customer relationships and increase customer value. CRM systems provide you with all the prerequisites for successful customer management.