Allow me to make a quick assumption about your small business: I’m going to assume the CEO doesn’t know, off the top of his or her head, the birthday of the third-to-last customer who bought the twelfth most popular international item during the last holiday shopping season. I further assume that exec can’t remember where she lives, how much money she spends with you every quarter, or whether her kids have an Xbox, PlayStation, or Wii.
That’s ok, no one keeps that kind of information in his head. That would be a waste of grey matter and valuable bandwidth cycles you simply can’t do without. But that doesn’t make the information any less important. And it doesn’t reduce the money you can make by properly leveraging that data.
That’s why you need a Customer Relationship Management (or, CRM) solution.
Big data for small business.
People do a lot of talking about big data as if the concept of storing and analyzing user information isn’t something we’ve all been doing for years. The truth is, retailers have long known that something as simple as sending a customer a discount for her birthday goes an amazingly long way to building loyalty, referrals, valuable feedback, and increased revenue.
The issue here is not whether retailers should collect data, it's how they should collect it. And, once it’s obtained, the next issue is how to store it, mine it, and let it work for the business without getting in the way.
Lucky for you we’re living in a “there’s an app for that” kind of world. And there really is an app for that—in fact, there are hundreds. With the tremendous overlap of features offered by all those providers, the argument for using one over another is less important that the decision to use one at all. Once you’ve made that decision, though, you’ll be well on your way to the promised land of working smarter, not harder.
The good part.
I’ll leave the criteria by which one should judge a good CRM for another day, and get down to how it’s going to help. The first thing that shiny new software is going to do is force you to collect all the data you have laying around and centralize it.
Even if you opt to leave 90% of the CRM’s features untouched, you'll still be ahead of the game. Retailers can learn exactly how many customers they have, where they live, how they communicate and how they prefer to shop (e.g. online, over the phone, in the store, etc).
Once you get over that initial data entry hurdle, your next step is understanding how important it is to create a file on every customer in real time. It’s painful at first, but repetition builds healthy habits, and this one will serve you well for years to come.
Collect as much data as possible, but determine where to draw the line, (i.e., be sure to define what constitutes “creepy.”) If you takes credit card information online or by phone, you'll have instant access to billing and shipping addresses as well as basic contact info. You'll also have the beginnings of a preferred payment method history along with purchasing data, and habits like product, time and price.
Make it a habit.
Stress with your employees the importance of recording everything at first, even if it seems trivial. At the same time, strive to normalize the data, weeding out information that never gets used. I always prefer quality over quantity, leaning towards a truly great picture of how a customer behaves over a faded map of their lifelong activities, too hard to decipher and too big to manage.