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The Bottom Line

The world economy has experienced many shocks over history. Some aspects of today’s economic environment are unique and create a level of uncertainly not seen since the 1970’s. Today, the global economy is more tightly integrated. Capital flows relatively freely across borders. Trade is an increasing percentage of nearly every company and country. Still, the threat of terrorism and other disruptions may become a continuous process.

Customer relationships, especially existing ones, have never been more precious. In an attempt to manage cost and hedge risks, companies must not neglect their customers. Fortunately, as our discussions have shown, investments in improving customer relationships often yield cost savings. Pick two or three areas of sales and marketing that show short-term promise and make sensible investments.

Integrating and standardizing customer data as the foundation for better decision-making are an obvious investment that can yield rapid results. Clear customer processes that span channels enable companies to move any phase of the customer life-cycle to the most efficient channel. Conversely, there are tremendous opportunities to harvest revenue from existing customers if the relationship is strong and data is transformed into actionable information.

This too shall pass. Companies that invest intelligently during this difficult period will have the best chance to ride the next wave.

CRM in the down economy

As you might have noticed thanks to the two latest series on this blog, Extraprise is concerned with how the down economy is affecting companies' CRM strategies, support, and implementations. To better measure the effects, we've put together a quick five-question survey. Click here to take the survey! We'll post the results here, and you can also sign up to receive a report via e-mail. If you're interested to see what we can do to help, fill in your phone number when you take the survey, and one of our representatives will contact you.

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In any period of uncertainty, there is a natural tendency toward caution and reluctance to invest in the future. Whatever takes place over the coming months and years, one thing is certain: the customer is king. That has always been true, but never more so than now.

Finding ways to better understand customer requirements, increase customer loyalty and manage costs will be the focus of every enterprise. Companies that do all these things well, and make targeted investments now will prevail. These imperatives will dominate the business world for some time to come.

Each company will take a unique path, but there will be some common themes in how each deals with a recessionary phase of business. We believe the following ten imperatives are critical issues for each of our clients to consider and resolve:

1. Integrate and secure customer information
2. Use better data to improve decision-making
3. Increase the focus on customer loyalty and retention programs
4. Increase sales focus on “farming” revenue from existing accounts
5. Make customer support the job of every employee
6. Turn every employee into a sales support person
7. Balance operational efficiency and growth
8. Focus on implementing long-term strategies as a process of continuous investment and improvement
9. Focus on return on investment
10. Use this opportunity to rebuild customer infrastructure

Over the course of the rest of the series, we will go into more detail about each of these issues and what you can do to manage and improve your customer relationships.

Managing Customer Relationships in Uncertain Times

“May you live in interesting times,” intones the old Chinese curse. Our times are more than interesting. They are troubling. Markets fall precipitously and rise tentatively. Credit is in crunch time. Doom and gloom are the currency of the day. However, despite the intervening problems, the economies in United States and other G7 nations will almost certainly flourish over the coming years. What exists in the immediate future is uncertain and there may be an understandable reluctance by management to invest too heavily in the future. This is particularly true of investments in marketing and sales, especially in areas that are perceived as discretionary or without an immediate return on investment. One thing is clear throughout the current business climate: the customer is king. Strengthening relationships with customers is no longer simply important; it is imperative. Each existing customer relationship is now sacred. Retaining and developing customer relationships are the life-blood of every company. After talking to our clients, both large and small, we find that there is a strong belief in the long-term economic health of the Americas and Europe. In the very short-term the U.S. Federal Reserve and other central banks are attempting to insure liquidity through increases in the money supply and cuts in interest rates. The attempt to inflate the economy with a continuing series of rate cuts, will spur investment over time. Certainly there will be increased government spending to rebuild and fortify existing defense, communications and healthcare infrastructure. Inflation, for the moment at least, is next year’s problem. Given the slowing of economies in the U.S. and Europe over the last several quarters, there has been much discussion of the form of a widespread global recession. Economists often picture economic downturns as a series of letters – a “V,” “U,” or “L” shaped recession. In the fall of 2008, most economists predict a U- or L-shaped recession with the sharp downturn followed by a lingering trough. Our view is that the recent turmoil in the market and the political structure increased the potential for a U-shaped recession. Our discussions with clients suggest that we may experience a continued downturn followed by an at least one temporary upturn over the next three to four quarters. Whether we are correct or not, business will go on. This blog series distills our thoughts and those of our clients. Opinions are many and varied. There is some consensus on actions, but less on their potential results. The following posts highlight a new role for customer relationship management in these difficult times, with a focus on nine issues that every company must consider over the coming months and years.