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Customer Relationship Management for Small Businesses

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  • 0:03 What Is CRM?
  • 0:48 Implementing CRM Process
  • 1:35 Useful Information
  • 2:36 Effective Use
  • 3:35 Managing CRM Information
  • 4:15 Lesson Summary
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Lesson Transcript
Instructor: Savannah Samoszuk

Savannah has over eight years of hotel management experience and has a master's degree in leadership.

Every small business needs a customer relationship management (CRM) system in place. This lesson will define customer relationship management and take a look at some challenges businesses face in using CRM and tips for overcoming them.

What Is CRM?

Michael travels for work and has to stay at hotels throughout the week. He tends to stay at the same brand, but he is in different cities each week. He is always amazed that the front desk knows he likes to be on the top floor, and they always have his newspaper ready for him when he checks in. How do they know this about him? This is where customer relationship management comes into play.

Customer relationship management (CRM) is a technique businesses use in order to keep track of interactions with customers. As technology has become more prominent, most businesses use a software system to handle their customer relationship management. The goal of CRM is to improve service by building relationships with customers in order to increase customer retention.

Implementing CRM Process

The first challenge small businesses face with CRM approaches is in the implementation process. A business needs to first find a software program or strategy to track all customer information. Larger businesses already have CRM processes in place and are usually just looking at improving their system. A small business has to start from the ground up. Initially, setting up the CRM system can be time consuming.

Next, the team needs to be thoroughly trained on how to use the CRM system as well as the information that should be tracked. Ongoing training to make sure all team members are always using and know how to use the CRM system should also be implemented. A CRM strategy will only work if every team member understands the benefits of it and knows how to use it.

Useful Information

Every business will be different as far as the information they want to be collected about their customers. Most businesses want to keep track of purchase history to be able to keep track of how often the customer frequents the business and to anticipate future needs. Larger businesses are able to see customer history from their franchise stores and have information for years. This is the challenge small businesses face in making sure they are putting useful information into their CRM. Other useful information can include personal information such as birthdays and anniversaries.

For example, if a restaurant knows that Mr. and Mrs. Smith come in every year on their anniversary, they can anticipate this by having that information in the CRM. The host then can acknowledge the anniversary and the chef can prepare a dessert for the customers. These are great ways to build relationships with customers. Businesses also like to keep track of preferences for future visits. The challenge will be determining what information you want stored in your CRM and making sure your team is trained to get that information.

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