CRM (Customer Relationship Management) refers to the management of relationships with customers. While many companies have traditionally managed customers on an individual sales representative basis, the importance of building strong customer relationships is increasing due to factors such as the decline in the working-age population caused by an aging society with a low birth rate, and technological innovations that make it easier to compare and evaluate products and services.
CRM serves as a solution to these challenges and is becoming an essential strategy for business operations.
In a broad sense, CRM refers to 'Customer Relationship Management,' but for marketers and business operators, it is often used to mean 'a tool for managing and visualizing relationships with customers.'
The primary purpose of CRM is to 'visualize customer relationships and maintain or improve them through optimal approaches and communication.'
By inputting customer information (such as business scale, stakeholder details, and pain points) into a CRM, you can identify high-potential leads and clarify the needs of high-LTV customers, thereby enabling more results-oriented sales activities.
When researching CRM, many people are also curious about terms like SFA and MA, as they are often explained together.
The table below summarizes the differences and characteristics of CRM, SFA, and MA.
SFA and MA are designed for new customer acquisition, whereas CRM is a tool that emphasizes the relationship between a company and its customers. However, in recent years, CRM and SFA are often treated as synonymous, and the boundaries between them have become blurred. For this context, it is helpful to remember that SFA and CRM are tools that support sales activities, while MA is a tool that streamlines marketing activities.
Three Reasons Why CRM Implementation Is Considered Important
Rising Customer Acquisition Costs
Customer acquisition costs are rising, making it essential to focus on maintaining and improving relationships with existing customers rather than solely pursuing new ones.
We live in an era saturated with convenient products and services, making differentiation increasingly difficult. Consequently, advertising expenses required to increase brand awareness for new customer acquisition are rising, leading to higher overall customer acquisition costs.
According to the 2022 Information and Communications White Paper by the Ministry of Internal Affairs and Communications, internet advertising costs in Japan have seen a significant increase, reaching approximately 2.7 trillion yen in fiscal year 2021.
For this reason, the implementation of CRM, which focuses on maintaining and improving relationships with existing customers rather than prioritizing new customer acquisition, has become highly important.
Increased Man-Hours for Existing Customer Management
Due to the impact of COVID-19, communication has shifted from traditional face-to-face interactions to remote methods.
While the shift to remote customer support has led to time savings, it has also resulted in a trend where surplus resources are reallocated to handle other customers.
As a result, the number of customers and the time required per sales representative have increased. Furthermore, with more staff members juggling both customer support and back-office tasks, the man-hours required for customer management are on the rise.
By implementing a CRM, companies can not only verify customer information and interaction history but also communicate directly with customers, such as by sending emails through the tool. Since CRM implementation is expected to reduce the operational burden of customer support, its importance continues to grow.
Intensifying Competition for Customers Among Competitors
The intensifying competition for customers among competitors is one of the reasons why CRM implementation is considered so important. In today's market, which is saturated with similar products and services, failing to provide high-quality customer service, adapt to current trends, or improve based on customer needs can easily drive customers toward competitors.
To develop products that remain competitive, it is essential to quickly identify changing customer needs and implement product improvements accordingly.
CRM helps in identifying these customer needs by visualizing customer status, usage trends, and patterns in both won and lost deals. For these reasons, the implementation of CRM is highly prioritized.
Basic CRM Functions
For those considering the implementation of a CRM, understanding what features are available is a key factor in the decision-making process.
The basic functions of a CRM are summarized in the table below.
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Function
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Overview
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Customer Management Function
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Functions for managing customer data, including deleting, adding, and updating customer information.
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Sales Support Function
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Functions that manage the entire process from initial negotiation to closing, helping to prevent missed opportunities and facilitating sales activities at the appropriate
timing.
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Inquiry Management Function
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A feature that allows you to review and manage inquiry details, display response templates, and view detailed customer information to facilitate smooth inquiry handling.
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Analytics and Reporting Function
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A feature that analyzes customer purchasing behavior, usage retention history, and trends in won or lost deals to help improve the results of future sales activities.
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File Sharing Function
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A feature that allows for the sharing of documents, images, and video files attached to emails.
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Schedule Management Function
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A feature that enables the sharing of schedules within departments using CRM tools.
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Search Function
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A feature that allows you to quickly locate specific information, such as customer data or inquiry details.
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Survey Function
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A function that allows you to create, distribute, collect, and analyze surveys for existing customers.
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Email Distribution Function
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A function that enables flexible email distribution, including mass email campaigns and targeted step-mail sequences.
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Integration Function
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A function that enables integration with external systems and tools, such as SFA, MA, Google services, and chat tools.
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CRMは顧客との関係管理に関わる機能が備わっています。ただし、これらの機能はCRMツールによっては搭載されていない可能性もあるため、導入前にベンダーへの確認が必要です。
Three Benefits of Implementing a CRM
Enables Information Sharing Across Departments
Implementing a CRM tool enables seamless customer information sharing across departments, which improves collaboration between sales and back-office teams and strengthens overall sales performance. With a CRM tool, authorized personnel can access customer information anytime, from anywhere.
Furthermore, because real-time information can be shared promptly, it becomes possible to share lists of high-intent customers and suggest the next best actions based on the customer's current status.
This facilitates smoother communication between departments and enables effective approaches that lead to successful conversions. A key benefit of CRM implementation is the ability to ensure that high-probability leads are never missed.
Improving the Quality of Customer Relationship Building
Implementing a CRM system leads to improved quality in building customer relationships. Beyond basic customer information such as capital and number of employees, a CRM can visualize customer preferences and challenges through purchasing behavior and usage history.
For example, if you are operating a B2B SaaS business and observe a decline in usage time, it may indicate that employees on the front lines are not fully utilizing the tool, or that the service does not align with their specific business challenges. To improve usage, you can consider and execute measures such as providing personalized customer success support or developing specific service features to enhance usability.
The primary benefit of implementing a CRM is the ability to grasp customer dissatisfaction with products and identify individual client challenges, enabling you to implement approaches to improve customer satisfaction more quickly.
Streamlining Customer Support
Implementing a CRM system also leads to the streamlining of customer support. CRM systems include features such as sharing response templates for inquiries as knowledge and mass-mailing capabilities, which increase the speed and efficiency of customer support.
As a result, even employees with limited back-office experience can provide professional customer support, allowing for speedy service without compromising quality.
The CRM Implementation Process
Identifying Internal Challenges
Before implementing a CRM tool, you should first identify your company's internal challenges. A common reason for failure in CRM implementation is when the goal becomes simply "to implement a tool."
CRM is a powerful tool for building customer relationships, and it is particularly effective when focused on analyzing existing customers to provide tailored proposals and support. Therefore, it is not suitable for companies whose primary goals are "increasing the number of new customer acquisitions," "automating new customer acquisition," or "reducing customer acquisition costs through lead nurturing."
Selecting a CRM Tool
After identifying your objectives and necessary functions, proceed to select a CRM tool. Key points to consider during this process are usability, scope of use, and integration with other services.
While there are low-cost CRM tools available, prioritizing price alone often leads to the goal becoming "choosing the cheapest tool." Instead, select a tool that helps you achieve your objectives, such as "choosing a user-friendly CRM because it will be used by front-line staff" or "choosing a CRM with robust support features for existing customers because you want to strengthen customer success."
Demo Usage and Implementation
Most CRM tools offer a trial period or demo videos before implementation. Since it is difficult to judge the suitability of a tool based solely on the features and benefits listed on a vendor's page, you should utilize these demos or watch the videos.
If you do not select a CRM tool that is appropriate for your company, there is a risk that it will not be fully utilized; therefore, compare services after using the demos. The process from selection and comparison to demo usage and final implementation takes at least one month. We recommend allowing sufficient time in your schedule if you are considering implementation.
How to Choose a CRM
Prioritize Usability
The primary challenge after implementing a CRM tool is ensuring internal adoption. Even if a top-down decision is made to implement a system, if frontline employees encounter issues such as being unable to input information, data entry becoming overly complex, or CRM usage increasing their overall workload, the tool will fail to gain traction. Furthermore, if a CRM tool is too complex to operate, it may lead to data entry errors or the input of outdated information, preventing effective customer management.
Some vendors offer CRM tools that include features to reduce the burden of data entry, provide guidance to encourage usage, and offer a user interface that allows for intuitive operation via drag-and-drop. By incorporating steps such as conducting a trial run with frontline employees before full implementation, you can ensure you select a CRM tool that is well-suited to your company.
Choose Based on Scope of Use
CRM tools vary widely, ranging from those specialized in building customer relationships to those with extensive sales functions for registering daily reports, business negotiations, and orders, or those equipped with robust marketing support features such as lead nurturing and automated email delivery.
If you only intend to use the tool for customer management, it does not necessarily need to be highly multifunctional. If you wish to visualize sales activities by linking customer information, project progress, and daily sales reports, it is better to choose a tool that also includes SFA functionality to ensure it matches your business needs.
Additionally, some CRM tools come with basic customer management features and allow for the addition of functions via options later on. Be mindful of selecting a tool that aligns with your company's specific scope of use.
Choose Based on Integration with Existing Tools and Systems
It is also important to select a CRM tool based on its ability to integrate with business card management systems, SFA/MA tools, chat services, and scheduling services that your company has already implemented.
If integration is not possible, you may be forced to input and manage data across multiple tools, which can complicate operations and lead to inaccurate analysis results due to data duplication.
