After drawing on research from AMR Research, McKinsey & Company, I point to the widespread adoption of CRM technology solutions.
CRM (Customer Relationship Management) is the technology that tracks customer activity and tailors marketing pitches accordingly. Estimates of the size and growth of the CRM software market vary considerably. Nevertheless, the investment in this technology is both substantial and growing and an important focus of companies’ budget. The Gartner Group estimated that worldwide spending on CRM was already $23bln in 2000 and would grow to $76bln by 2005 (or about $100bln by 2007).
Two-thirds of all telecom operators in U.S. and half or more of all U.S. financial services, pharmaceutical, BioTech and transportation companies are either implementing or already utilizing such solutions. Across the USA and Europe, approximately 45% of the companies in the high technology, healthcare, aerospace, retailing and utilities sectors have invested in CRM systems.
Most large organizations dealing with a giant number of customers have adopted or will adopt one or more IT-based CRM solutions. Medium-sized and smaller organizations need to consider their existing and potential scale in relationship to the technology requirements.
Having analysed extensively CRM project management and using a range of sources I’d like to emphasize some of organizational prerequisites that make a company an ideal candidate for adopting an IT-based CRM solution:
- Do you have a large number of people in sales and service in direct contact with customers, say more than 30?
- Are you in a highly collaborative environment, with customer interaction requiring input from multiple players within each function (sales and service)?
- Do you sell complex products that require a high degree of configuration and customization?
- Do you have a large number of customers, say more than 10 000?
- Is a typical customer relationship worth a lot to you from a profit standpoint, i.e. will it cost you to lose one?
- Can your customers interact with you across multiple channels?
- Do you have frequent contact with large groups of customers, or all customers, across multiple channels?
- Is there a need to customize what you are saying to each customer through these channels?
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