Wednesday, 7 March 2012

The Sales Funnel (or Sales Pipeline) Part 2

A sales funnel is for sales. CRM is for managing the data about customer relations.

A commonly cited definition of CRM is that of CRM (UK) Ltd (2002), as follows:
Customer Relationship Management is the establishment, development, maintenance and optimisation of long-term mutually valuable relationships between consumers and organisations.

Let's unpack this definition.

The key to the definition is long-term mutually valuable relationship. This is based upon a definition of marketing that considers marketing as a mutually satisfying system of exchanges (for example Baker 2002).

So CRM is the building and maintenance of long-term customer relationships. The relationship delivers value to customer, and profits to companies. The relationship is supported (but not driven) by cutting edge IT. 

The business strategy is based upon the recruitment, retention and extension of products, services, solutions or experiences to customers. This is the core of CRM.

CRM is not an indicator of sales effectiveness or sales process unless the system you use directly and accurately reflects the organisations ACTUAL sales process. CRM is not sales pipeline! 

Now, get your sales process right, build an authentic sales funnel/pipeline and then coach it. Simple. 

Once that is done investigate and implement an accurate CRM strategy with a company who has a track record in developing and implementing CRM as their core business.


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