CRM and CX — two sides of the same coin.
It’s all about the Customer.
We live in one of the most remarkable epochs in human history. Digitization and technological progress demand innovation, success strategies and growth potential from companies. Every brand experience is in the hands of a technologically empowered customer. The exclusivity of offers or services is steadily decreasing, and alternatives are just a click away. Barriers to switching from platform to platform, product to product, service provider to service provider are increasingly reduced. The once predictable and linear customer journey to purchase or service usage has been replaced by a new unpredicatble funnel driven by digital technologies. Because of the dynamic customer journey, customers re-evaluate their purchase options each time. They swipe, tap, click, like, share.
Customer Experience — a buzzword on everyone’s lips
Relevance, empathy, seamless connection of customer touchpoints with an absolute focus on customer needs, individual approach and presence on relevant channels are the new criteria for success in the age of digitally enabled custome. The magic word in expert circles, at conferences, in white papers and surveys is customer experience. Google delivers over 4.1 billion search results in a fraction of a second for the term. Interest in this discipline has grown over the years, as business success is no longer determined by the 4Ps, but by how well we can serve customers. So it’s not surprising that there are multiple opinions and definitions of Customer Experience. I work with my definition, which I developed with my team and use as a guiding north star. We understand Customer Experience as the sum of all moments a customer or non-customer spends with a company, across its lifecycle.
Customer Experience and Customer Relationship management — the two sides of one coin
While Customer Relationship Management (CRM) pursues an inside-out view, i.e. focuses on generating added value for the business, e.g. through relevant customer segmentation, Customer Experience (CX) forms an interface to CRM through the outside-in perspective of added value for the customer, i.e. customer value.
CRM refers to a set of technologies, strategies, processes and practices that organizations use to manage their interactions with customers and potential customers. The main goal of CRM is to improve customer relationships, increase customer loyalty, and drive sales growth. CRM software helps organizations to track customer interactions, automate sales processes, and manage customer data. It focuses on the organization’s relationship with the customer and aims to improve it.
CRM mainly focuses on the process and activities of analysis, planning, implementation, measurement and optimization aimed at initiating, stabilizing, intensifying and resuming business relations relationship with customers.
On the other hand, CX refers to the overall experience that a customer has with an organization, from initial contact to post-purchase support. CX includes all touchpoints that a customer has with an organization, such as customer service, marketing, sales, and product/service delivery. The main goal of CX is to create a positive experience for the customer, which leads to customer satisfaction, loyalty, and advocacy. CX focuses on the customer’s experience with the organization and aims to improve it.
In my view, the two disciplines belong inseparably together, since a proper balance between business and customer value must be continuously maintained and questioned. The need for a dual perspective is therefore crucial for focusing on customer needs. If a product team has released a new feature for the mobile app that allows push notifications to be sent to customers, the extremely simplified question from the CRM perspective is: How can we use the new feature to increase our users’ loyalty to the app. This includes dimensions such as customer segments, products, services, frequency, time of day, and so on. At the same time, CX managers ask: What problem or concern do customers have that they can get a friendly reminder about using our app, and how can we help them solve that concern or problem. In this way, CX management brings together the customer view and the organizational view.
