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Customer Relationship Management (CRM)
The goal of CRM is to develop personalised communication and
marketing. As a result, companies will be able to increase activation of
distributors, productivity and retention. Proper use of CRM will help
companies improve their bottom line and get ahead of the competition.
4 elements have to be considered in using CRM in direct selling:
1. Personalised Communication
2. Personalised Marketing
3. Measurement
4. Working with Distributors
1. Personalised Communication
When companies communicate to distributors, it is often one message
to everyone, for example at a meeting, through publication or through e-
newsletters. However, there are actually many different segments of
distributors, each with their own requirements and interest. As
distributors will only read a limited amount of information, it becomes
critical for that information to be the most relevant and important to the
specific audience.
2. Personalised Marketing
Similar to communication, different distributors and customers have
different wants and respond differently to different marketing messages
and promotions. By identifying the different segments and different
needs, the company will be able to carry out more effective marketing
campaigns, while reducing wastages from marketing to those whose
buying decision would not affected by the marketing programmes.
3. Measurement
A key feature of CRM is the measurement of results. It employs the tactic
of using control groups, the group where no programme is being
implemented, and measuring it against target group, the group where
the programme is being implemented. By so doing, the returns from
CRM can be accurately measured to determine the amount of resources
to be applied and the direction to pursue.
4. Working with Distributors
Unlike other industries like banks, retailers and airlines, CRM should be
applied in a different manner for direct selling companies. This is
because such companies can rely on their distributors, especially the
leaders to understand the customers and perform personalised
communication and marketing. However, when a distributor’s size of
organisation increases to a point where personalised communication
and marketing is no longer possible, CRM tools will become very
important for them to be effective. The company should not only use
CRM themselves, but extend the tools to distributor leaders as well. The
distributor leaders will be able to apply the high touch element of the
business while being supported by the high tech portion.
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