The CRM process helps relationships with customers, streamlines operations, and boosts profitability if all steps are followed.
This article will give you an insight into What crm process step requires a cycle of two assessments and how to follow the cycle for better customer relationship management.
What is the Assessment Phase of the CRM Cycle?
The CRM cycle is a systematic approach to managing and nurturing customer relationships.
It involves various stages and processes designed to create, maintain, and grow positive interactions with customers.
At the heart of this cycle lies the assessment phase, a critical step that plays a pivotal role in shaping the overall CRM strategy.
The CRM Process Cycle
Before we dive deeper into the assessment phase, let’s first establish a basic understanding of the CRM process cycle. This cycle typically consists of five stages:
- Data Collection and Entry: The initial stage involves gathering customer information, which can include contact details, preferences, purchase history, and more. This data forms the foundation for all subsequent CRM activities.
- Data Analysis: With a treasure trove of customer data at hand, businesses analyze this information to gain insights into customer behavior, needs, and preferences. This analysis is crucial for crafting personalized experiences.
- Strategy Development: Based on the insights gained from data analysis, businesses create a CRM strategy that outlines how they will engage with customers, what channels they will use, and what objectives they aim to achieve.
- Implementation: This stage involves putting the CRM strategy into action. It includes tasks such as sending personalized communications, resolving customer issues, and providing support.
- Assessment: The final stage of the CRM cycle, which we will explore in detail, focuses on evaluating the effectiveness of the CRM strategy and making necessary adjustments for continuous improvement.
The Assessment Phase Explored
Now, let’s turn our attention to the assessment phase within the CRM process.
This phase will help you achieve your goal and aid in decision-making.
The assessment phase typically includes the following steps:
1. Performance Metrics Evaluation
The first thing to do is to carefully set up key performance indicators (KPIs) that will go along with their CRM goals for better customer satisfaction and general sales growth.
2. Data Analysis
After making sure that the relevant KPIs are in place, then the next step is to analyze the data to see how the CRM strategy is performing against these metrics.
This involves reviewing customer feedback, survey results, and sales data to gain a holistic view of the situation.
Real-Life Example: An e-commerce platform conducts a post-purchase survey to gauge customer satisfaction. By analyzing the survey responses, they can identify areas where customers are particularly pleased or dissatisfied, allowing them to tailor their CRM efforts accordingly.
3. Identification of Gaps and Opportunities
During the assessment, businesses should be on the lookout for gaps in their CRM strategy. These gaps represent areas where the strategy is falling short of expectations. Conversely, the assessment phase is also a time to identify opportunities for improvement and growth.
4. Strategy Adjustment
Based on the insights gained from the assessment, businesses can make informed decisions about adjusting their CRM strategy. This might involve refining communication methods, revising marketing campaigns, or allocating resources differently.
Real-Life Example: A restaurant chain notices a decline in customer engagement through its loyalty program. After analyzing customer feedback and transaction data, they decided to revitalize the program by offering more attractive rewards and simplifying the redemption process.
What Sets the Assessment Phase Apart?
Now, you might be wondering what makes the assessment phase of the CRM cycle unique in requiring a cycle of two assessments.
The answer lies in the dynamic nature of customer relationships and the need for continuous improvement.
First Assessment: Post-Implementation Evaluation
The initial assessment in the CRM process occurs after the implementation of the CRM strategy. This post-implementation evaluation serves as a performance check to determine whether the strategy is delivering the expected results.
During this assessment, businesses focus on:
- Measuring the Impact: They evaluate how the CRM efforts have affected customer relationships, sales, and overall business objectives. This is the first crucial assessment step.
- Identifying Immediate Issues: Any glaring issues or discrepancies that emerge as a result of the CRM implementation are identified and addressed promptly.
Real-Life Example: A financial services company implements a CRM system to enhance customer support. After a few months, they assess the impact and find that the response time to customer inquiries has improved significantly. However, they also notice that customer satisfaction ratings have not seen the expected boost, leading them to investigate further.
Second Assessment: Ongoing Monitoring and Adjustment
The second assessment in the CRM process is ongoing and continuous. Unlike the post-implementation evaluation, which occurs at a specific point in time, this assessment is perpetual. It involves regularly monitoring CRM performance and making adjustments as needed.
During this assessment, businesses focus on:
- Continuous Data Analysis: They keep a constant eye on customer data and KPIs to identify trends, patterns, and emerging issues.
- Proactive Issue Resolution: Rather than waiting for issues to become glaring problems, businesses address them promptly to ensure a seamless customer experience.
Real-Life Example: An online subscription service conducts daily analyses of user engagement and subscription renewal rates. If they notice a sudden drop in engagement or an increase in churn, they take immediate action, such as sending personalized offers to at-risk subscribers.
Why the Two Assessments Matter
The concept of two assessments within the assessment phase of the CRM cycle underscores the importance of adaptability and agility in modern business practices. Here’s why this dual assessment approach matters:
1. Adaptation to Customer Dynamics
Customer preferences and behaviors are not static. They evolve over time, influenced by various factors such as market trends, competitor actions, and external events (e.g., a global pandemic). By conducting both post-implementation and ongoing assessments, businesses can adapt their CRM strategies to stay aligned with changing customer dynamics.
2. Timely Issue Resolution
The first assessment helps in identifying immediate issues that may have arisen from the CRM implementation. Prompt resolution of these issues prevents them from escalating into larger problems that could negatively impact customer relationships and business outcomes.
3. Continuous Improvement
The ongoing assessment ensures that businesses don’t become complacent after the initial implementation of their CRM strategy.
4. Data-Driven Decision-Making
Incorporating data analysis into both assessments promotes data-driven decision-making. Businesses can make informed choices based on real customer insights rather than relying on intuition or assumptions.