The catalyst to acquiring a CRM system is very often the desire for management to better understand and to manage the pipeline of deals. This focus typically is on the acquisition of new customers. While CRM systems can indeed be a great tool for pipeline management, another benefit that is often overlooked in the decision to license a CRM system is the care and feeding of the installed base.
An old axiom in sales is that it is much easier to keep an existing customer than it is to acquire a new customer. From a top level perspective, an installed base customer has value for so many reasons that losing a customer to a competitor should never be taken lightly. The value that an existing customer can deliver include 1) repeat sales, 2) increased sales as a result of their growth, 3) references for prospects to contact, 4) upsell opportunities, 5) cross sell and 6) and sell to other parts of a large company.
In the SaaS environment, where the monthly revenue is the lifeblood of the company, the value of keeping a customer is one of the key determining factors in the valuation of a company. Not only will high churn, by its very existence, limit the revenue growth potential, it is a strong indicator for overall customer satisfaction. Not paying close attention to your installed base will ultimately result in disastrous consequences.
Elements to Review
Contacts: Relationships are made with people and not with companies.
- By staying close to your contacts, understand and help them alleviate or eliminate their pain-points, recognize their accomplishments, and help them when they need assistance, a trust and a bond will be created.
- I highly recommend that you connect with your key contacts on LinkedIn. This is a great tool that can help you stay in touch with your network:
- Congratulate them if they receive a promotion
- Wish them best of luck if they are switching companies
- This might be a future sales opportunity to land a new customer
- LinkedIn is also a great way to review employees at a customer. If you see an employee that you do not know that perhaps you should, give them a call and introduce yourself
- Use the Task functionality in the CRM to remind you to give each customer a call or visit at the time interval you deem most appropriate. There is no right or wrong answer as a particular customer or contact might require more contact than others at any particular time. The key is the CRM application is a great tool to facilitate this activity
- Customer Support Tickets:
- A sales person should know any customer support issue that has been escalated or if a constant stream of calls to customer support are occurring. While the customer support organization is best qualified to manage the issues, a well-informed sales person is in a much better position to interact with a customer that is dissatisfied vs being blindsided by the issue when they visit or call the customer. If the latter occurs, it will be a painful lesson learned a bit too late.
- Purchase History: While an ERP system does keep track of what a customer has purchased, having this information in a separate system is valuable for a few reasons including providing a tool for the sales people that is all inclusive so they do not have to access, learn, navigate and obtain licenses for the ERP system. This information is one of the key benefits of having your CRM system integrated with your ERP system. Otherwise, this information will likely lose its accuracy very quickly.
- This information allows the sales team to better understand and help their customers to leverage their system to a greater degree. For instance, if the customer is telling the sales person that they need to accomplish a specific task, they might already have that capability available, but they are not aware of it. The customer’s issue is now converted from a product satisfaction issue to a training issue.
- By using a CRM, integrated with your ERP, the salesperson has complete access to what the customer does not purchased; perhaps the latest model, an accessory add-on, or a newly released feature
- Track installed base sales opportunities
- CRMs are just as effective as managing your new customer sales pipeline as they are managing opportunities emanating from your installed base. All notes, stages, forecast amount, date and probability are all important things to review and manage.
- Another good practice is to attach any and all quotes provided to the customer in case the opportunity is deferred to a future time. Having the prior quote readily available is obviously very valuable.
One final closing comment; if your sales representatives are not keeping detailed notes regarding your existing customers all their knowledge will walk out the door if the sales person was to leave the company. The company will have a much better chance to maintain or improve the relationships with their customer during such a transition if all relevant notes, contacts and quotes are in the CRM system.