• May 6, 2024
  • By Leonard Klie, Editor, CRM magazine and SmartCustomerService.com

CRM Embraces Financial Transactions Like Never Before

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With the 2024 election cycle now in full swing, the economy is a major factor on voter’s minds as they consider their candidates. Inflation, interest rates, and higher prices for everything from eggs to gasoline are the so-called kitchen-table issues that will have a big impact at the polls this year.

Companies are not immune from the financial crunch, either. Sure, they have the luxury of being able to pass on their higher costs to the consumer by raising the prices for their goods and services as market conditions change. But they can only go so far. After all, customers place a premium on price predictability, which has to inform how often businesses adjust their prices, according to Jim Vaughn, global head of pricing advisory services at Zilliant, whose newest book is featured in our Required Reading section this month. And while they will always prefer smaller increases over larger ones, consumers really don’t like the “death-by-a-thousand-cuts price increase approach,” he tells me, urging companies that “understanding what customers value beyond product fit is key to a well-aligned relationship.”

Ah, there’s the CRM angle, that ever-so-important customer relationship piece. I bet you were wondering where this was going, since pricing has traditionally been a back-office function handled by the corporate bean counters using configure-price-quote (CPQ) software and enterprise resource planning (ERP) solutions.

Vaughn further relates that “the ability to match price to the benefit the buyer will receive allows businesses to tap new customer markets, and…makes those customers very sticky.”

Users of these unified systems can connect tactical pricing data derived from analytics to strategic/operational business intent/objectives, he goes on to say.

Pricing isn’t the only financial aspect of corporate life that is getting more ingrained into CRM. As we point out in our third feature, “CRM Now Shows Companies the Money,” companies are now tying their payment processing directly into the e-commerce and CRM platforms they use. The benefits are significant; chief among them is a shortening of the time between when the consumer first discovers the initial product/service and when the sale is finalized.

For the consumer, it creates a seamless process, from start to finish, without the friction of having to switch between platforms and applications. For the company, it provides yet one more source of data that can shape future marketing and sales outreach. Companies might not want to aggressively pursue opportunities with a client who has a hard time paying his bills. Also, being able to see how the client likes to pay right within the CRM system allows for just one more oh-so-valuable opportunity for personalization of the user experience and improving operational efficiencies. The bottom line is that companies can get paid faster.

And it also leads to profitability. Just look at the Heylo case study that we present in our Real ROI section this month. When the company, which manages membership communities for its clients, started taking payments integrated back into its CRM system, its business model changed to the point where it is now handling more than $1.5 million for its members, up from just a few thousand dollars a year ago.

I continue to be impressed by all the ways that CRM is expanding and all the other business systems that are now being linked to it. It makes sense for the payment and e-commerce integration to happen now; much of the data is the same, whether it’s being used to send a promotional offer, follow up after a sales call, or issue an overdue payment reminder.

And, if nothing else, we know that customers want their transactions to be as seamless and free of friction as possible. If all of this means that companies can eliminate one or two handoffs between systems and departments, then everyone wins—the company, the consumer, the financial institutions, and anyone in between. But let’s not change the meaning of CRM to Customer Relationships and Money just yet.

Leonard Klie is the editor of CRM magazine. He can be reached at lklie@infotoday.com.

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