Role of CRM Software During Challenging Economic Conditions

Slowing economy and its consequences
The global economic meltdown impacts every industry. There is no business or sector that can stay immune from the effects of the economic slowdown. This is mainly because this time round it has more widespread consequences and certain economies that are worst impacted are gradually sharing the debt load. The effect of this is an overall slowdown where one economy or economic zone has the tendency to pull another down.

At this time, be it for the corporate sector or the small scale industry, the business terrain is hostile. The reason for this is again a cyclical process where fiscal measures are slowing growth rates that in turn are impacting consumption. The consumer today is panicking and preparing for another long drawn crisis situation. The manufacturer is ensuring that production is at par with the expected demand which is slowing. Investment is at a record low and going by the sombre economic mood in Europe, it looks like tables will take a long time to turn after this crisis.

As a result of the slowdown across sectors, B2B selling is tougher than ever. While emerging firms are struggling with the high interest rate and high inflation regime, the more established players have taken a very cautious approach and have streamlined their business models further to ensure optimum utilisation of resources.

Technology and industry
An economic slowdown however does not warrant that innovators will slowdown too and therefore technology continues its rapid progress. In a planet where smartphones and tablets can run an entire enterprise, technology has the power to rejuvenate economies.

From a micro-economic point of view, technology can provide the single unified platform that unites every player in the industry and therefore creates healthy competition, more innovative business strategies and overall development.

So how does one cope?
The biggest question that haunts decision makers today is whether to take a defensive and conservative stance at this time of crisis or wait till the fat lady really sings. Though experts will opine that one definitely needs to adjust according to the economic weather, it is also important to understand that the present scenario may also have huge potential that may remain untapped if certain risks are not taken. Stalling or delaying expansion or capacity building plans may not be the wisest idea according to some, but it definitely can pave the way for the higher demand expected in the future.

Upgrading technology could be the last thought on the minds of certain boards of directors but it is surely the right time to do it, if one ensures that the new technology will provide sustainable growth. Technology that can help take decisions on marketing strategies and also provide the board with a higher degree of control on the various departments could well be the solution. While CRM solutions might be the obvious answer, there are certain factors that need to be kept in mind while considering the same.

The customerHandling the customer at this critical juncture is the key. Market studies conducted post the slowdown will not only provide a great indication about the changing consumption patterns but also help forming CRM policies that can ensure customer retention. One of the basic strategies that most international firms are likely to adopt is to create cheaper, customised and more cost oriented products. IT firms need to come up with business solutions that respect and build upon its client’s profit making ambitions. The buzz surrounding cloud computing is a clear indicator of what the customer is looking for and going by the inclination of IT giants towards the cloud, it could well be the way of the future.

Now, CRM solution providers have to keep in mind that it is not their customer who is the key but their customer’s customers who are the primary focus. Dwindling margins and disappearance of massive projects from the larger markets like Europe and the US has forced a large number of firms to look inwards and this trend is more common in Asian countries. Solution providers that have a deeper insight into customer behaviour in specific markets will therefore enjoy an edge over its competitors.

A large amount of actionable customer data is therefore the need of the hour. Solutions need to be simple, easy, customer centric and flexible. A company that distributes data perfectly an efficiently within its various departments and exercises a good system of control over the integration of the various departments will have a better chance to cope with the rough economic weather.

Best-fit CRM solutions
At this stage, CRM solutions that work very closely with the basic functions of companies might be the best bet. Customers are most likely to look for faster ROI. However, advancement in technology and the cloud could well provide the answer to the issue. CRM solutions that keep into account the tight funds and the slowing growth of a company as well as the economy are likely to tap the market at this hour. Solutions that promise little and deliver more at a cost that does not raise eyebrows will cut the cake and eat it too.

One of the biggest advantages that CRM solutions will provide firms in this economic weather is customer retention. Access to large amounts of customer information and the ability to take marketing and sales decision based on such data will give companies an edge over others. Co-creating affordable products which simplify the life of customers is now a growing necessity and subtly encourages them to remain loyal and share their positive experiences with others.

Though the market may advocate it and the boards may be tempted to do it, moving from a product based approach to a service based approach could also be a major risk. This is mainly because the market will pick up sometime in the future and these services will have a tendency to become obsolete. On the other hand, a CRM solution that can cover the immediate needs of an organisation at this tough juncture and grow with the organisation's needs in terms of value addition as the market improves will therefore wipe its competition clean.