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Is CRM necessary when there are few customers?

I am interested in learning how early-stage companies apply CRM to the marketing and sales of "disruptive technologies." I have a lot of experience working within companies here on the west coast that have developed paradigm-shifting systems for drug discovery and development. These companies are R&D driven and thus tend not to spend on technology for relationship development, depending instead on their highly technical sales forces and R&D/customer-support people to nurture the brave souls who first adopt the new category product.

Do you think that CRM confers strategic advantage when the customers are few and visionary, yet interact with the company with depth and frequency? Customers in essence become product-development partners.
Great question! When you ask "Do you think that CRM confers strategic advantage when the customers are few and visionary, yet interact with the company with depth and frequency?", it sounds like CRM is already being practiced in your industry! In fact, when Don Peppers and Dr. Martha Rogers wrote "The 1to1 Future" 10 years ago, one of their predictions was that CRM strategies would drive unprecedented customer collaboration in large enterprises, in essence turning customers into partners. As you mention in your question, this is really already the case. So I think the question becomes "does CRM TECHNOLOGY confer strategic advantage in this situation?"

As further clarification of my position here, consider that I don't think CRM is a "new" idea. It's been practiced forever by successful small merchants who have had the ability to remember in their heads the important needs and information about their relatively few "most valuable customers", and as a result, treat different customers differently. The modern CRM movement is about using technology to enable CRM strategies to be practiced in large enterprises, where lots of customers touch the company through many different channels. It sounds like your industry, through a situation where there are very few customers and few, deep interactions, practices CRM strategies quite naturally.

So if you agree that the question becomes about the applicability of CRM technology (instead of CRM strategies) to your situation, my answer is -- it depends! The questions that must be asked are:

1. Do these companies plan eventually to scale the distribution of their successful disruptive technologies? If so, the resulting growth of the customer base and complexity of the interactions will require CRM technology investment.

2. In these companies, is there true customer data integration between the salesforce and the desktop of the R&D worker? Product innovators can improve both their ability to innovate and their new product success rates if they have access to real-time, structured information about client needs, how clients use products, the unique business culture and problems of their clients -- in general, information on what their clients life is like at work. If this integration of data is not complete or is suboptimal in your clients' firms, CRM technology investment can fix the problem.

3. Does the business have the ability to handle the customer data "complexities" inherent in a business-to-business marketing situation? Each business-to-business account has individuals who are buyers, influencers, and users of products. Again, integrating information (and making it available to R&D workers and others who contact the customer) on the most important needs of all or most of these buying influences can help both the R&D personnel and the salesforce be more successful. Typically, without CRM technology this type of information is collected and stored on the sales rep's desk top (if it is collected and stored at all). And what happens to this information if the sales rep leaves the firm?

If none of the issues listed above cause difficulties for your clients, then this situation is one of the rare instances where CRM technology investment is not necessary to successfully practice CRM strategies. However, as soon as the amount of important, actionable customer information becomes too voluminous to be remembered in the minds of the salesforce and R&D personnel, CRM technology becomes necessary.
This was last published in June 2003

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