CRM and the Digital Transformation

With ever increasing competition, it is becoming harder for businesses to compete based on product(s) or service(s) alone. With specific regard to the Club industry, competition has now spread well beyond traditional leisure activities, such as going to cinemas, sporting activities, restaurants and pubs. The introduction of app-based services that take experiences into the customers’ homes has changed the way many people spend their free time.

With that said, many Clubs and businesses alike have recognized the need to embrace a digital transformation. But what exactly does it entail? Put simply, digital transformation is a customer centric approach of using new technologies to optimize existing processes and encourage ideation of new processes to fill various gaps in customer experience delivery, changing market conditions and even redefining a business’ culture (Salesforce, 2019).

Customer knowledge is a vital source of competitive advantage in todays dynamic business environment. According to Khodakarami and Chan (2014), there are 3 types of customer knowledge possessed by an organisation:

1. knowledge for customers (the type of knowledge an organisation provides to its customers to satisfy their needs)
2. knowledge about customers
3. knowledge from customers (this is knowledge that an organisation’s customers possess which can be captured by the organisation during interactions with the customers

In other words, customer data inflow (capture of customer data), processing (identifying key trends, patterns and building customer models) and data outflow (relevant communications with customers).

Most Clubs collect a wealth of data as a part of their day-to-day activities. Customer information, demographics, transaction data and more. These data sources are useful in their own right, but true power comes when all these data points are connected to form a holistic view of the Club’s members. Customer Relationship Management (CRM) technologies have made creating this in-depth view of the Member a lot easier.

The benefits of a good CRM implementation with regards to the technology can result in:

• Improved collection of knowledge about customers and collection of knowledge from customers (e.g. through customer feedback)
• Facilitation of improved communication with customers through various channels such as email, SMS and social media. Allows greater engagement of customers with the organisation by helping customers learn more about the organisation’s services
• Improved communication within the organisation allowing different people to share customer knowledge across different departments and the organisation as a whole.
• Improvement in offerings of product and services to better align with customer needs
• Access to the right customer information to enable better decision making.

Additional benefits of a CRM system include (Sharma, 2016):

• Centralising of information allowing for integration of disparate sources of data across different departments and a wide variety of applications. This integration results in the reduction of duplicate data and time spent to eliminate these redundancies manually.
• Streamlining and automation of processes through the use of process templates enabling the constant delivery of consistent results
• Constant access to services regardless of time and location allowing for continuous access to the right information.

It is important to remember that CRM is a broad set of principles and tools an organisation used to attract as well as retain customers through increased customer satisfaction and loyalty (Gibbert, 2002).

A CRM system can only be effective if designed, implemented and used properly and consistently and is only a device, albeit a powerful one amongst other factors in delivering a differentiating and outstanding customer experience.