CRM (Customer Relationship Management) refers to the management of relationships with customers. While many companies previously managed customers on an individual sales representative basis, the importance of building strong customer relationships has increased 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 provides the 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 challenges) into a CRM, you can identify customers with a high propensity to purchase and clarify the needs of high-LTV customers, thereby enabling sales activities that are more focused on achieving results.
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 tools are primarily designed for new customer acquisition, whereas CRM tools focus on the relationship between the company and its customers. Recently, however, the terms CRM and SFA are often used interchangeably, blurring the lines between them. For this context, remember that SFA and CRM are tools to support sales activities, while MA is a tool to streamline marketing activities.
Three Reasons Why CRM Implementation Is Considered Important
Rising Customer Acquisition Costs
As customer acquisition costs continue to rise, the focus has shifted from solely acquiring new customers to maintaining and improving relationships with existing 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 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 non-face-to-face 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 customer interactions.
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 duties, the man-hours required for customer management are on an upward trend.
Implementing a CRM not only allows for the verification of customer information and interaction status but also enables direct communication, such as sending emails to customers from within the tool. Because CRM implementation is expected to reduce the man-hours required for customer support, its importance continues to grow.
Intensifying Competition for Customers Among Competitors
The intensifying competition for customers among rivals is one reason why CRM implementation is considered critical. In today's market, saturated with similar products and services, failing to provide high-quality customer support, adapt to emerging trends, or improve based on customer needs will inevitably drive customers toward competitors.
To develop products that remain competitive, it is essential to quickly identify shifting customer needs and implement product improvements accordingly.
CRM helps in identifying these needs by visualizing customer status, usage trends, and patterns in both won and lost deals. For these reasons, CRM implementation is highly prioritized.
Basic CRM Functions
For those considering CRM implementation, understanding "what functions are available" is a key decision-making factor before adoption.
The basic functions of 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 adding, deleting, and updating customer information.
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Sales Support Function
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Functions for managing the entire process from negotiation to closing, ensuring no follow-ups are missed and prompting sales activities at the appropriate
timing.
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Inquiry Management Function
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A feature that enables the confirmation and management of inquiries, the display of response templates, and the viewing of detailed customer information to facilitate smooth inquiry handling.
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Analysis and Reporting Features
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A feature that analyzes customer purchasing behavior, usage continuity history, and trends in orders won or lost to drive improved performance in future sales activities.
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File Sharing Features
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A feature that allows for the sharing of documents, images, video files, and other materials attached to emails.
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Schedule Management Features
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A feature that allows schedules to be shared within departments using CRM tools.
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Search Features
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A feature that allows users to quickly locate desired information, such as customer details and inquiry content.
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Survey and Questionnaire Features
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Features for Creating, Distributing, Collecting, and Analyzing Surveys for Existing Customers
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Email Distribution Function
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Functionality for Flexible Email Distribution, Including Mass Emailing and Targeted Step-Email Campaigns
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Integration Functionality
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Functionality for Integrating 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
Enabling Information Sharing Across Departments
Implementing a CRM tool enables 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, anywhere.
Furthermore, because real-time information can be shared promptly, it becomes possible to share high-intent customer lists 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 not missed.
Improving the Quality of Customer Relationship Building
Implementing a CRM leads to improved quality in building customer relationships. A CRM visualizes not only basic customer information, such as capital and number of employees, but also customer preferences and challenges through purchasing behavior and usage history.
For example, in a B2B SaaS business, if a decrease in usage time is observed, it may indicate that employees are struggling to utilize the tool or that the service does not align with their specific needs. To improve usage, you can consider and execute measures such as providing personalized customer success support or developing specific service features to enhance usability.
A key benefit of CRM implementation is the ability to grasp customer dissatisfaction with products and individual challenges, enabling you to promptly implement approaches that improve customer satisfaction.
Streamlining Customer Support
Implementing a CRM system can lead to the streamlining of customer support. CRM platforms offer features such as sharing response templates for inquiries as knowledge bases and mass-messaging capabilities, which increase the speed and efficiency of customer interactions.
This allows even employees with limited back-office experience to provide professional customer support, ensuring high-quality service is delivered efficiently.
The Process of Implementing a CRM
Identifying Internal Challenges
Before implementing a CRM tool, first identify your company's specific challenges. A common failure in CRM implementation occurs 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 may not be 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 features, proceed to select a CRM tool. Key points to consider during this process are "usability, scope of use, and integration with other services."
While some low-cost CRM tools are 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 for frontline employees" or "selecting a CRM with features that facilitate support for existing customers 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 a tool based solely on the features and benefits listed on a vendor's page, be sure to utilize demos or watch demo videos.
If you do not select a CRM tool that is well-suited to your company, you may struggle to utilize it effectively; therefore, compare services after testing them. The process from selection and comparison to demo usage and final implementation typically takes at least one month. We recommend allowing sufficient time in your schedule when considering implementation.
How to Choose a CRM
Prioritize Ease of Use When Selecting
A common challenge after implementing a CRM tool is ensuring company-wide adoption. Even if a top-down decision is made to implement a tool, if frontline employees find that they cannot input information, that data entry becomes overly complicated, or that the CRM tool increases 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, which prevents effective customer management.
Some vendors offer CRM tools that include features to reduce the burden of data entry, provide guidance to encourage usage, or offer a user interface that allows for intuitive operation via drag-and-drop. By incorporating steps such as conducting a trial demonstration that includes frontline employees before implementation, you can ensure that you select a CRM tool that is well-suited to your company.
Select Based on the 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 order management, or those equipped with features to support marketing activities such as lead nurturing and automated email distribution.
If you only plan to use the tool for customer management, it does not need to be highly multifunctional. However, if you wish to visualize sales activities by linking customer information, project progress, and daily sales reports, you should select a tool that also includes SFA tool functionality to ensure it matches your business needs.
Additionally, some CRM tools offer basic customer management features with the option to add more functionality later. Be mindful of selecting a tool that aligns with your company's specific scope of use.
Select Based on Integration with Existing Tools and Systems
It is also important to select a CRM tool based on its ability to integrate with the 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 or lead to incorrect analysis results due to data duplication.
