From Mass Marketing to One-to-One Marketing

CRM has its evolutionary roots in the progression of marketing, as enabled by advancing technology. Exhibit 5.1 illustrates this evolution from mass marketing, through target marketing, to customer marketing, to one-to-one marketing.

Exhibit 5.1 Marketing Evolution with Characteristics and Technology Attributes

Source: Swift, Ronald S., Accelerating Customer Relationships: Using CRM and Relationship Technologies, 1st Edition, © 2001. Printed and Electronically reproduced by permission of Pearson Education, Inc., Upper Saddle River, New Jersey.

Mass marketing evolved in the early 1900s and dominated marketing management and strategy for decades. In the 1960s, many firms began to apply principles of segmentation, target marketing, and positioning to create different strategies and marketing programs for different consumer groups. A major change in mindset precipitates a shift from targeted consumer marketing (i.e., marketing to big groups of like-minded buyers) to customer marketing, or a focus on developing relationships with individuals customers. This approach first gained widespread attention in the 1980s. Many of the issues on relationship selling and strategic partnering discussed earlier in the book relate to customer marketing. Ultimately, the sophistication and multiplicity of available technology today enable true one-to-one marketing, as some firms are now able to truly customize offerings for individual users. This concept has been introduced and expanded on in several books by Don Peppers and Martha Rogers.⁶

As mentioned earlier, CRM enters the picture as a process that provides internal formalization for enabling successful customer marketing and one-to-one marketing. CRM has three major objectives:

1. Customer retention. The ability to retain loyal and profitable customers and channels to grow the business profitably.
2. Customer acquisition. Acquisition of the right customers, based on known or learned characteristics, which drive growth and increased margins.
3. Customer profitability. Increased individual customer margins, while offering the right products at the right time.⁷

Thus, a key realization is that CRM involves the process of acquiring, retaining, and growing profitable customers—consistent with a relationship selling approach. And consistent with our discussion of value in chapter 3, CRM requires a clear focus on the service attributes that represent value to the customer and that create loyalty. Simply put, customer value means that when the customer weighs the costs (monetary and otherwise) of a relationship with a seller, the benefits realized from that relationship outweigh the costs. Building customer loyalty is an important goal of CRM processes because loyal customers are typically highly satisfied with the relationship and the product offering and are very unlikely to switch to another company and its products or brands.

CRM has several advantages over traditional mass media marketing, as has been typically used in support of mass marketing and target marketing. The advantages are that CRM:

• • Reduces advertising costs
• • Makes it easier to target specific customers by focusing on their needs
• • Makes it easier to track the effectiveness of a given promotional (marketing communications) campaign
• • Allows organizations to compete for customers based on service, not prices
• • Prevents overspending on low-value clients or underspending on high-value ones
• • Speeds the time it takes to develop and market a product (the marketing cycle)
• • Improves use of the customer channel, thus making the most of each contact with a customer.⁸

One of the most important concepts in CRM is that of the lifetime value of a customer. In his books on customer loyalty, Fredrick Reichheld has demonstrated time and again that investment in CRM yields more successful long-term relationships with customers and that these relationships pay off handsomely in terms of cost savings, revenue growth, profits, referrals, and other important business success factors. It is possible to actually calculate an estimate of the projected financial returns from a customer, providing a very useful strategic tool for deciding which customers deserve what levels of investment of various resources (money, people, time, information, etc.). Such analysis has raised the prospects of firing a customer who exhibits a low predicted lifetime value and investing resources elsewhere. Of course, such action assumes other, more attractive customers exist for one’s investment.⁹

CRM Process Cycle

The process cycle for CRM may be broken down into the following four elements: (1) knowledge discovery, (2) market planning, (3) customer interaction, and (4) analysis and refinement¹⁰ (see Exhibit 5.2).

Exhibit 5.2 Crm Process Cycle

Source: Swift, Ronald S., Accelerating Customer Relationships: Using CRM and Relationship Technologies,, 1st Edition, © 2001. Printed and Electronically reproduced by permission of Pearson Education, Inc., Upper Saddle River, New Jersey.

Knowledge Discovery. This is the process of analyzing the customer information acquired through the touchpoints mentioned earlier. These might include point-of-sale systems, call center files, Internet accesses, records from direct sales, and any other customer contact experiences. A customer-centric data warehouse environment is the optimal approach to handling the data and transforming them into useful information for customer strategy development. A data warehouse environment affords the opportunity to combine large amounts of information and then use data mining techniques to learn more about current and potential customers. A variety of software products are available to help manage the knowledge discovery phase.

Market Planning. This is a key use of the output of the knowledge and discovery phase, in that marketing and customer strategies and programs are now developed. These involve the use of the marketing mix and especially the promotion mix in integrated ways. This process will be discussed in detail later in the chapter.

Customer Interaction. This phase represents the actual implementation of the strategies and programs, including the personal selling effort as well as all other customer-directed interactions. These must be aimed at all the customer touchpoints, or channels of customer contact, both in person and electronically.

Analysis and Refinement. Finally, the analysis and refinement phase of the CRM process is where learning takes place based on customer response to the implemented strategies and programs. This is a continuous dialogue with customers that is facilitated by all of the inputs for customer feedback. Over time, adjustments made to the firm’s overall customer initiatives should yield more and more efficient investment of resources in the endeavor such that return on customer investment is maximized.

Toward a Relationship-Based Enterprise

As stated earlier, CRM represents both an overarching business philosophy and a process or tool to facilitate a truly customer-driven enterprise. Facilitating long-term, win-win relationships between buyer and seller firms is a central tenet of CRM. In order to move toward being a relationship-based enterprise, and to improve the effectiveness of CRM initiatives, ten critical questions must be answered.¹¹ These questions may be grouped into the following categories: customers, the relationship, and managerial decision making.

A Peek at Historical Sales Technology

Contemporary selling firms and their managers have always employed a wide array of devices and tools to carry out their jobs. While today we take quite advanced technologies for granted, the truth is that the sales role and especially a firm’s relationship with its customers have evolved right along with technology. There are five historical salesperson roles that have been impacted and changed through the technology evolution, identified in Exhibit 5.3 as mobile market developer, long distance communicator, dynamic presenter, market intelligence gatherer, and prompt service provider.¹⁵ Exhibit 5.3 shows how each role changed and what new skills were required, and provides examples of technologies that facilitated salesperson success in each of the role categories over time. Notice that many of even the older technologies have not completely disappeared—advancing technology sometimes displaces old ways but sometimes it simply adds additional choices to the toolkit. The historical portrayal in Exhibit 5.3 stops with the 1980s, corresponding to the proliferation of personal computers—a technological development that was a game changer for sales organizations.

Naturally we are much more interested in the role of sales technology today and going forward as opposed to technology of the past. The young generation of organizational sellers and buyers that comprise an ever-increasing portion of B2B relationships today can scarcely imagine what life must have been like doing business with such basic sales technology tools. Can you envision that, prior to basic cell phones, traveling salespeople had to stop at gas stations to use pay phones between sales calls? But remember that there are plenty of folks from that generation of salespeople (and their buyers) still in the field!

Post-1980, Exhibit 5.4 identifies three evolutionary decades of more advanced sales technology: Origin, Formative, and Relationship. Several exemplar technologies are shown that became particularly relevant during each decade, and almost all of these technologies continue to be used to one degree or another by sales organizations. We believe the present decade (2010s—Informational decade) represents a true revolution in selling (rather than an evolutionary process, as before) because many of the current technology tools have resulted in extreme changes in how business is carried out. That is, the potential seems high that driving new opportunities through social media and related technology will permanently redefine certain aspects of selling and what a customer relationship actually means. If nothing else, these technologies have forever opened the flood gates for instantaneous, real-time, and fully participative communication between sellers and buyers as well as between both parties and anybody else that wants to be either party’s Facebook friend or would like to follow them on Twitter. Global Connection points out an interesting and somewhat anti-cyclical recent development in personal computing driven largely by needs in emerging markets.

Source: Paul Christ and Rolph Anderson, “The Impact of Technology on Evolving Roles of Salespeople,” Journal of Historical Research in Marketing 3 (February 2011), pp. 173–93.

Note: Several exemplar technologies are shown that were particularly relevant during three earlier decades. Some of these drop out in use over time; others continued to be used across the decades moving forward. Our intent here is to demonstrate the flow of technology development over those years, not to imply that some of the older technologies aren’t still in use.

Sales Technology in the Informational Decade

Bringing us forward to today, the technology tools that we use as part of our daily lives—especially elements like social media, smartphones, and tablets—are revolutionizing the sales role and salesperson/buyer relationships beyond anything we might have imagined just a few years ago. The crux of why this can be called a revolution in selling can be summarized in the following two concepts: information access and portability. The capability for nearly instantaneous and real-time 24/7 access anywhere in the world to information required by buyers can alter the traditional role of a relationship salesperson of creating client through information. That is, if information is just as available to clients as to sales organizations, essentially information becomes a commodity and no longer a source of value-added. This does not mean that there aren’t myriad other ways that salespeople can add value (review chapter 3 for some excellent approaches); what it does mean is that the old days of salespeople relying on simply providing customers with information they can’t get elsewhere as the key to getting the sale are likely over.

Let’s take a closer look at several categories of technology tools, some of the specific options in each, and how these tools can be best applied for B2B selling. This is not an exhaustive set but it does reflect some of the most applicable options for salespeople.

Communication Tools. In the past, most professional selling was done in person or by phone. Although often there are certainly great advantages to face-to-face communication, travel costs can be incredibly high, especially when selling on the global stage. Multiple tools are available now that mitigate the need to communicate in person. Examples:

• • WebEx—The market leading web-based presentation tool, WebEx is widely used in B2B settings.
• • Skype—Online and relatively inexpensive calling. Skype is replacing/enhancing a lot of traditional teleconferences and also allows sales team members from around the world to participate in a blended technology sales call—that is, a sales call on a buyer that includes some in-person salespeople and some via electronic means.

Presentation Tools. Laptops and standard PowerPoint have been the bellwether for in-office sales presentations for many years. Today there are numerous enhancements available for the creative-minded presenter. Examples:

• • Plug-in Packages—Add-on PowerPoint plug-ins come in dozens of forms. One is Snap by Lectors, which provides great tools to create voiceover PowerPoint slides and also easily adds video and other enhancements so that the presentation feels “21^st Century.”
• • Distribution and Feedback Options—Numerous cloud-based sites exist for editing, presenting, and commenting on information that has been shared (including shared PowerPoint presentations). Voice Thread is typical in that it allows users to leave feedback, questions, edits, etc. Salespeople can use it to create and sustain an ongoing two-way dialogue with a buying team about key aspects of a presentation, providing the sense that an interactive community has been developed throughout the sales process. Inside the sales firm, Voice Thread lends itself well to salesperson training when the manager and salesperson are not able to work together in person during part or all of the training process.

Mapping Software. Many outside salespeople travel extensively. Especially if they are regularly cultivating new customers in new geographic areas, modern-day spinoffs from the global positioning software all around the world (GPS) technology developed in the 2000s can be very useful in increasing productivity on the road (globally). Examples:

• • Google Maps—Quite sufficient for most salesperson call routing needs.
• • Map Quest—A representative example of the many different mapping applications that salespeople have at their fingertips.

These programs offer a variety of features and most are (selectively) global in reach.

Social Media. Social media are Internet-based platforms that allow users to create their own content and share it with others that access the site. These platforms all aim to build community and communication-sharing among users. Recall that in chapter 2 we made a distinction between B2B and B2C? Don’t make the mistake of thinking that social media are mostly applicable only in B2C situations. People that use these technologies in their daily lives for personal purposes tend to bring that usage straight over to the workplace setting. Younger generation organizational buyers not only are willing to do business with salespeople over social media, they expect it!¹⁶ Examples:

• • LinkedIn—The gold standard of professional social media sites, LinkedIn is used heavily by salespeople for researching new and current customers and preparing for sales calls, and creating and maintaining social networks with buyers. Sales managers use it for recruiting new sales reps. In general, LinkedIn can be thought of as the “new business card” for salespeople.
• • Facebook—Wildly popular globally for personal networking, Facebook is useful to salespeople and sales managers in much the same way as LinkedIn. Because it is not specifically business-focused, it can be more challenging to cull through the personal aspects to find information germane to the client. But many salespeople do heavily utilize Facebook as a primary means of communication and community building.
• • Twitter—Twitter and the short Tweets it enables makes for a convenient and quick way for users to “follow” each other. The message size limit is perfectly adapted to smartphone usage, and the real-time nature of the process is appealing in terms of quickly identifying and reacting to trends. Twitter data can be mined for themes that can play into marketing and public relations campaigns.
• • YouTube—A handy video-sharing website, YouTube is great for salespeople and their companies to post to for use with buyers in presentations and otherwise. Companies can make their offerings available through a YouTube channel dedicated to a particular company or product line. The audience is highly dispersed globally. Salespeople can also search for use, other posted videos for general instructional or informational purposes with their clients. There is quite a lot of clutter on YouTube, so salespeople need to be savvy in culling through the postings to find ones that are useful and relevant.
• • Blogs—Blogs are online journals and forums that are generally publicly accessible. Tumblr and Flickr are two well-known blogs. Blogs preceded the current wave of social media sites and usership has gone down recently, particularly by younger people. But many very useful blogs still exist that salespeople can turn to for real-time information on an industry, competitive market, general trends, or just interesting thinking on timely topics. Many companies keep up their own blogs, so if a potential customer has one the salesperson can gain insight there that could be useful prior to making a sales call. In addition, some salespeople keep up their own blog and invite their customers to post regularly.
• • Other Social Media Options—The social media space is rapidly expanding and relatively newer entries such as Tumblr, Google Plus+, and Instagram are available as communication tools for today’s salespeople. Although it should be clear from the discussion above that social media affords some great opportunities for improving buyer–seller relationships, one caution is that salespeople should not become overconsumed in the social media world to an extent that other forms of communication with clients are underutilized.

Time Management Tools. Salespeople need to be very mindful of their use of time. In chapter 10 you will learn more about the importance of various aspects of self-management to salesperson success. Many technology options are available. Examples:

• • MS Outlook—A simple solution to a variety of calendar, time management, and related needs. Most people think of Outlook as just an email program, but it is also a very powerful tool for schedule sharing and event scheduling.
• • Smartphone Apps—As a device, the smartphone is rapidly becoming the primary hardware of choice for sales organizations. Not that companies are ready to totally replace tablets and laptops quite yet, but the portability and multitasking capabilities smartphones bring afford a high level of efficiency to a salesperson’s daily routine. The range of apps available is staggering. One category that is particularly useful focuses on helping ensure that salespeople don’t forget important tasks. Apple has a “Reminder” app, and there’s another one called “To do,” both of which do a great job of making sure that busy people stay on task!

Recruiting Sites. In chapter 12 you will find out about strategies to recruit the best possible people into professional selling jobs. Technology solutions for recruiting across multiple fields abound, and professional selling is no different. Examples:

• • Monster.com and CareerBuilders.com—Selling and sales management categories on websites such as these are heavily utilized and never fail to contain numerous opportunities around the globe.
• • Company Online Applications—Many sales organizations want potential recruits to start the process with them online. Before starting to make applications online, candidates need to seek some advice on how to put the best foot forward using this type of recruiting system. Numerous resources are available about how to rise above the pack in online applications.

Opportunities on the Frontier. Two particular technology areas seem to have a good deal of potential for future application in selling and sales management.

• • Virtual Worlds—Most people think only of Second Life when they think of virtual worlds, and Second Life is certainly a pioneer. In virtual worlds, users participate through avatars and engage in activities that may or may not parallel the sort of things they do in their “real” world. Quite a few firms built sites within Second Life, usually for promotional purposes. But over the long haul, the usefulness of virtual world technology for selling is not likely to be through a public application such as Second Life, but rather through customized applications that are sponsored by individual sales organizations. Consider, for example, how a virtual world for Pfizer Pharmaceuticals could help train new salespeople in how to break through screeners (receptionists, nurses, etc.) to actually meet with physicians, or educate physicians directly on Pfizer’s product specifications and usage protocols. For other types of products, buyers can view and experience product features and benefits, observe usage, and provide feedback to a firm on aspects of product development.
• • Gaming—Videogames are enormously popular with a large portion of the population throughout the world. Gamification, approaching other tasks and turning them into a videogame-like platform, is becoming popular all across the fields of education and training. An opportunity exists for sales organizations to invest in gamification as a way to make training of salespeople more fun and engaging. Chapter 12 covers training in detail, and a variety of traditional sales training tasks—from learning how to make a presentation to detailed product knowledge—could be translated into a gaming platform. Gamification can also enhance presentation of information to buyers. Imagine how a clever videogame-style demonstration of a product might stimulate interest and separate the message from the regular routine of traditional sales presentation approaches.

Gaining Technology Acceptance by Salespeople

The Informational Decade we are now in when it comes to sales technology highlights the importance of information management and integration within an organization, focused on enhancing the customer experience and building strong customer loyalty over the long run. Much research has gone into understanding sales force technology adoption, including CRM. A famous model called the technology acceptance model (TAM) has been heavily tested and consistently predicts that salesperson attitude and behavioral intentions to use a technology are positively impacted by the perceived usefulness and perceived ease of use of the technology by the salesperson. As such, it is incumbent on sales managers to ensure that the available technology is presented to the sales force in such a way that maximizes those positive perceptions. Effective technology training, consistent technological support by the firm, and compensation systems that reward salespeople who deploy the technology ensure that a sales organization will go a long way in gaining technology acceptance. This investment in time and resources is definitely worth it—once technology acceptance is high, the research indicates that successful selling increases and overall salesperson performance improves. Thus, technology acceptance and usage is a very powerful element in sales organizational success.¹⁷

Although obviously the plethora of new technologies available to salespeople brings great opportunity, there is also a bit of a “dark side.” Recently, the term “technostress” has been coined to refer to the potential for stress and tension in organization members created by incessant and forced adoption and use of technology. That is, salespeople may feel compulsive about being connected and sharing constant updates, feel forced to respond to work-related information in real-time, be effectively tied to serving clients 24/7, and engage in almost habitual multitasking. In addition, they may feel compelled to work faster because information flows faster and have little time to spend on sustained thinking and creative analysis. Sales managers must be cognizant of these potential offshoots of technology and should exceed traditional training and provide education, coaching, involvement, and continuing technical support for sales force technologies so as to minimize technostress.¹⁸

One important final caveat related to sales technology deserves mention. There is considerable evidence of a strong negative correlation between salesperson age and likelihood of embracing technological innovation. Simply put, it is much more likely that younger generation salespeople who essentially grew up in the midst of the lead-up to the Informational Decade will seek out and take on new technologies on the job simply as a matter of course. In contrast, older generation salespeople may tend to be slower to proactively seek job-enhancing technologies and may even resist using those required by the firm. The problem is exacerbated when it comes to sales managers, who are more likely to be older generation rather than younger and who are expected to not only lead by example in using new technology, but also to be able to train incoming salespeople on the applications.

This generational gap in technology is a sensitive situation for senior management in sales organizations. Experienced (translation: older) salespeople are the most likely group to call on the largest customers and to enjoy the deepest customer relationships. They may respond to pushes toward technology usage by saying that they’re successful doing things the way they always have, and may even threaten to walk away and take important customers with them. And in the case of non-tech-savvy sales managers, they can experience a good deal of stress when it becomes clear that their newest recruits come onto the team much more technology proficient than they’ll likely ever be themselves! There are no easy approaches to addressing this issue. In Part Three of the book you will become familiar with many issues of salesperson motivation, training, and rewards—at that time we will bring up the issue of career life cycles and some ideas for keeping and nurturing senior salespeople.²⁰

Customer and Market Insights: Get to Know your Customers and Market Better

As boundary spanners within the organization, salespeople are in a unique position to gather information about the markets they serve. This could include intimate knowledge about current and potential customers, changing customer preferences, emerging industry trends, and valuable information about competitors (competitive intelligence). In addition, customers are constantly communicating about a company and its competitors on various websites and social media platforms and in many cases directly contacting customer service when questions arise. Although some of the information collected from these customer encounters may be presented in a structured format (i.e., machine readable such as when a customer rates a salesperson’s service as a “5-Highly Satisfactory” on a web survey), the vast majority is presented in an unstructured format (i.e., not naturally machine readable, but potentially easy for a person to comprehend such as when a customer puts in the “Comments” section of a web survey that “Deborah was our salesperson and she did a fantastic job of helping us understand all of our options. We’d gladly contact her for future purchasing decisions.”). Taken in total, such information has the potential to provide salespeople and sales managers with a better overall picture of the customer marketplace. One of the primary goals of an organization that practices CRM and sales analytics is to gain a 360-degree view of the customer—deep, fact-based insights about customers for sales and marketing decision making. Exhibit 5.5 illustrates a number of key input components that comprise such a 360-degree view. A key benefit of achieving this perspective is that it makes it easier to understand the needs and value-adding potential of a customer for the firm.

Exhibit 5.5 Inputs to 360-degree View of the Customer

It is important that the capabilities of CRM and sales analytics be applied at all stages of the customer journey from identification as a prospect via a lead, to initial contact, through the process of engagement, and into a long-term relationship. At each stage, gaining customer insights is critical to salesperson success.

Insights for Customer Segmentation. Segmentation is a concept that most traditional marketers know very well. But did you know that salespeople practice customer segmentation? The core concept in segmentation is the idea that “you can’t be everything to everyone.” The vast amounts of data collected within CRM systems helps salespeople identify customers with similar needs, interests, and characteristics that may not have been apparent otherwise. These segments can then be used to define selling strategies and tactics by-segment that lead to better overall performance. There is strong evidence that effective customer segmentation has a strong, direct impact on salesperson and sales unit performance, and effective customer segmentation is difficult without CRM-enabled sales analytics.²²

Insight into the Value of Customers. Understanding the current value of a customer in terms of the business they have provided or will most likely provide over the short or long run provides sales representatives and managers with greater insight into how their time is best spent. Existing customers’ current and expected value can be examined in terms of present and historical results, as well as those results that are expected to be contributed in the future. For potential customers, advanced sales analytics can provide an estimation of the value of a customer to be acquired by considering factors such as the similarities between a potential customer and a segment of customers the organization has already acquired. This process creates a predictive measure of the value of the customer to be acquired.²³ Knowing the value of a potential customer as well as the current and expected value of those customers that the organization currently serves makes forecasting, planning, and other strategic and tactical sales activities more productive.

In some cases, with the right data and analyses, an organization might come to the realization that a customer who was previously considered to be highly valuable is barely profitable due to the high level of resources the sales organization is devoting to that customer. High revenue customers who require a disproportionate amount of resources including the amount of time expended by employees to service them, and the knowledge capital required of specific employees to service them (for instance, highly knowledgeable employees who are proportionally compensated) may not be considered as high value as previously thought. Smaller customers, however, may end up being recognized by an organization as being more valuable related to the acquisition and retention requirements that they carry.

Insight into Opportunities within the Market. Data collected within CRM systems by the sales force, customer service representatives, and digital marketers offers significant opportunities to better understand the market as a whole. Having a better view of the customers that an organization serves or wishes to serve provides greater opportunities to understand when conditions within the market are changing. This information, which may be gathered through sales meetings between a customer and an organization’s salesperson, or calls between a customer and an organization’s customer service representatives (to name a few), has the potential to provide insight into the market that might not be as easy to ascertain through other sources.

Having the sales force feed this kind of intelligence gathering into the organization’s CRM system can help provide indicators of changing customer preferences and trends within the market. Conditions may change that require an organization to engage in efforts to change the way they deliver their products or services or the components that comprise them. In some cases the issue could simply be that original assumptions made about different organizations within a given market were incorrect. In either case, the data gathered by the sales force within a CRM system could help provide evidence to challenge those original assumptions made by the organization and help lead to strategic change.

How does all this gathered intelligence end up displayed for use by the firm? Often, this occurs via an organization’s marketing dashboard. Similar to a dashboard on your car, a marketing dashboard is a convenient location where various customer-related data and metrics are collated and displayed as useful key information by users. Often the dashboard is displayed as a home page on users’ computers. Marketing dashboards have the potential to help an organization to better sense changes in the market and to better understand its performance and positioning.²⁴ They help to provide consistent marketing information across the organization as well as a high-level view of an organization’s performance within the market.

Get to Know Your Sales Force Better

Being able to track the activities that salespeople engage in with customers provides an organization with a clearer understanding of the return on investment (ROI) and of selling are in a better position to understand how the sales force is performing and also how to further enhance performance. To help make this objective easier, CRM systems commonly carry the capability to integrate data from email communications and phone calls and correlate the data to the appropriate customer record in the system in order to provide deeper insight into the customer relationship. These capabilities enhance analytic and reporting capabilities for the organization and provide greater insights into how to better support the performance of the sales force. Some of the specific benefits include:

Promote Accountability for the Sales Force. Gaining greater visibility into the actions of the sales force means greater accountability for their actions. Standard procedures and best practices related to selling activities can be tracked within CRM systems and more easily monitored. In order to reward salespeople for timely and diligent inputting of data on their selling activities, organizations can provide incentives in the form of bonuses or other types of compensation.

An example of where the accountability facilitated by a CRM system comes into play relates to tracking the speed at which a member of the sales force follows up on a lead generated through the organization’s website. The longer the delay between the creation of a lead and the subsequent follow up by a salesperson, the less likely that lead will take an appointment with the salesperson who contacted them and ultimately become a customer. A salesperson who understands that this type of data is being tracked in the system and that the expectation is that each lead will be followed up promptly is more likely to make an effort to do so, especially if appropriate incentives are provided as rewards for this performance.

Provide Greater Decision Clarity and Motivation for the Sales Force. CRM-enabled capabilities to gain a more holistic view of current and potential customers also provides the sales force with the means to better plan, prioritize, and adjust to shifting conditions. Salesperson decision making is further facilitated by the kind of analytics that enable them to see how close they are to their sales quotas and how they are performing against other metrics that impact evaluation and compensation. In addition, advanced analytical methods can reveal the likelihood of a lead converting to a customer as well as the potential value of that customer. The perspective gained from such information helps a salesperson understand where they stand in relation to their objectives, and what opportunities remain to help them achieve those objectives. This knowledge makes it easier to determine what steps should be taken next at a given moment, which in turn helps provide greater motivation to continue forward towards achieving those objectives.

Enable Sales Managers to Lead and Manage. CRM-based analytics help provide a view into salesperson execution of specific activities that are a part of the selling process. This knowledge enables sales managers to more closely examine the specific steps that salespeople are taking in relation to a current or potential customer and the related result. Thus, sales managers are better able to keep track of the performance of the sales team and the relative status of current and potential customers, providing greater guidance for leading and managing the sales force.

Impediments to Maintaining CRM System Data and Sales Analytics Efficacy

A well-designed CRM system provides analytic and reporting capabilities that help managers to make more effective decisions and salespeople to acquire and retain customers. The system must be designed to meet each user group’s needs and at the same time meet the overall business requirements of the firm. The primary components of an effectively designed CRM system include business workflows, analytics, reporting, and dashboards. The foundational elements required to achieve these components include having the right types of data identified and developing the right types of functionality within the system to automate processes and perform required analyses and treatment of the data. Exhibit 5.6 illustrates these elements of CRM-enabled sales analytics. Three of the primary impediments to the successful implementation and continued use of a CRM system to drive the performance of the sales force are discussed below.

Impediment 1: Salespeople Don’t “Buy In.” The potential benefits of CRM systems and integrated big data analytics that you’ve read about in this chapter aren’t always communicated well by organizations to those who are intended to use the system and receive its benefits. Some salespeople within any given organization will seek out new ways of using technologies adopted by an organization to improve their performance without any prompting or assistance, but for other salespeople this won’t be the case. For them, the “old ways of doing things” will override the risks and effort required to make a change. Hence, sales organizations need to ensure that a mix of top leader commitment and encouragement, broad internal marketing, and consistent and high quality user training is in place prior to the implementation of a CRM system, and also that continued salesperson support is available after the implementation. Investing in ongoing support is clearly worth the investment, given the substantial benefit that the effective implementation of a CRM system can have on an organization. Users who understand the value of the system and understand how to use it effectively will gain greater benefit from it and in turn provide more valuable data for use in analytics and reporting.

Exhibit 5.6 Elements of Crm-enabled Sales Analytics

Impediment 2: Salespeople Don’t “Feed the Machine.” One of the most critical issues related to the efficacy of a CRM system is the quality and quantity of the data provided. If the data being provided are inaccurate or incomplete, and if not all of the required data are being entered into the system, then regardless how advanced the system’s analytic and reporting capabilities are, the end results will misrepresent reality. A common software engineering term GIGO (garbage in, garbage out) sums up the issue nicely. Hubspot, a leading inbound marketing software company, noted in a recent research report based on a survey of over a thousand sales professionals that manual entry of data into the CRM system was listed by over 20 percent of those surveyed as their primary challenge in using their organization’s CRM system.²⁶

Impediment 3: The Value is Lost in the Weeds. Given the sheer amount of data available to organizations through CRM systems, one of the key challenges is transforming the data into actual insights using analytics interpretive capabilities. This requires providing the right information in the form of key metrics showcased in report briefs and on dashboards. There is a real art to homing in on the information that matters most and then determining robust and appealing ways of presenting that information to the sales force. This might mean providing it in pictorial and graphical representations with crisp text that helps enable its easy use and high value to a salesperson. Identifying simpler and more actionable metrics and representations of data is much more likely to succeed versus more complex ones that might turn off or perplex those who are intended to use them. Salespeople are smart but they’re also very busy and they need their customer insights “to go!”