Customer Relationship Management (CRM) and Customer Communications Management (CCM) are similar concepts, although they serve distinct purposes in business. Most large organizations have formally practiced CRM for decades, but CCM has only become a priority during the last few years. This trend is largely the result of the growing use of Omni-channel communications. Thus, the typical use of CCM is to improve an existing CRM program with respect to customer communications.
Overview
Customer Relationship Management is an approach to managing an organization’s interactions with its current and potential customers. It performs tasks in many areas such as contact management, productivity and sales management. CRM includes the collection and analysis of customer data for the purpose of improving that organization’s relationship with its customers, especially customer retention. Compiling data from multiple communication channels like chat, email, social media and websites is a critical aspect of CRM. These sources of customer information help businesses learn more about what their customers want and how they can meet those expectations.
Customer Communications Management is a strategy for improving the creating, storage and delivery of an organization’s outbound communications, which typically include notifications for billing and payment and account renewals in addition to marketing materials. While the majority of these communications are directed towards customers, CCM also manages an organization’s interactions with other stakeholders such as distributors, partners, suppliers and regulatory bodies.
CRM and CCM are closely related because they both deal with the communications between an organization and its current and potential customers. CRM focuses on managing those interactions by analyzing customer data to increase customer retention and sales growth. In comparison, CCM supports customer interactions with a range of tools and processes.
Customer Relationship Management
Customer Relationship Management systems have existed since the early 1970s, when companies would evaluate customer experience and satisfaction with annual surveys that were recorded on paper spreadsheets. Today, CRM solutions are based on a variety of computing environments such as cloud-based platforms and mobile devices. Gartner predicts that CRM will become one of largest areas of spending for enterprise software by 2021.
Most organizations currently use CRM to some extent due to the value it provides. For example, Aberdeen reports that effective sales organizations are 81 percent more likely to practice CRM consistently. CRM also increases sales forecast accuracy by 42 percent and sales productivity by 34 percent, according to Salesforce. Furthermore, Nucleus Research shows that the average return on investment for CRM is $8.71 for each dollar spent. Nevertheless, 40 percent of salespeople still use informal methods of CRM such as spreadsheets to store customer data.
Limitations
CRM provides organizations with the means to collect customer data and analyze it, allowing them to better understand the preferences and behavior of their customers. They emphasize driving a positive customer experience (CX) by pushing communications through various communication channels selected by the customer. CRM systems have improved steadily over the years, but they still lack some of the capabilities needed to improve customer experience (CX), which is what makes CCM beneficial.
A strong focus on CRM can be highly effective in determining what customers want, but it can also overlook the quality of content in communications. CRM solutions often struggle to provide the best possible CX because they fail to deliver content that meets the needs of that interaction. Without CCM to personalize messages, those messages can appear to be form letters with canned responses. While a good CRM platform can streamline the communication process, CCM facilitates the management of CX. Integrating CCM with CRM thus provides a complete CX solution.
Customer Communications Management
The right Customer Communications Management platform can personalize communications across all channels, including document generation. This capability allows customers to receive targeted communications on the channel of their choice, which is critical for providing a positive experience for today’s customers. A Gartner survey shows that 89 percent of companies will soon be competing primarily on CX, meaning it will become the next battleground in business. Adding CCM to CRM will thus become essential for remaining competitive.
Benefits
The ability of Customer Communications Management to enhance CX is difficult to overstate, as shown in a study conducted by marketing analyst firm Forrester across nine industries. This study found that auto and home insurance providers could increase their revenue by $1 billion just by clearly communicating policy costs and the process for filing a claim. Financial institutions also stand to gain hundreds of millions in revenue by making their communications more understandable. CCM also fosters customer trust and ensures branding consistency, both of which ultimately result in increased revenue.
Finding the Right Solution
A Customer Communications Management platform should be integrated across an entire enterprise, including the use of CRM data. This feature provides customer-facing staff with the information they need to craft relevant messages for their customers. An integrated approach to CCM allows these employees to incorporate personal customer data and demographics into individual messages. In comparison, CRM solutions often limit employees’ data access to silos that are specific to each communication channel.
Assume for this example that a customer service representative (CSR) recognizes an opportunity to cross-sell or upsell another product to a customer. The CRM provides the customer’s contact information, but it does not link that information directly to the message that the marketing department has already developed. A CCM solution could allow the CSR to quickly retrieve that message, personalize it and transmit it through the customer’s preferred communication channel.
An enterprise-wide approach also supports the rewriting of frequently used content into plain language, which can dramatically improve CX. In addition, CCM allows staff members to streamline rules and approval processes need for regulatory compliance. This capability is particularly important for businesses in the healthcare and financial sectors, which are becoming increasingly regulated.
Summary
Business leaders have long considered CRM to be an essential part of improving CX. However, they are just now starting to recognize the importance of CCM in retaining existing customers and attracting new ones. Augmenting CRM with a holistic approach to CCM helps ensure that your customer data provides you with actionable insights into customer behavior.
André Klein
Freelance Consultant for DocPath