CRM & Lifetime Customer Value

The Evolution of CRM

In the early 90’s, the auto industry suddenly became aware that in order to survive, they needed to change their focus from inward to out. Specifically the industry has moved from the question of “How can I make more money by getting new customers?” to the more profound question of “How can I make the life of my customer easier in order to retain them?” But before you can communicate and work with a client; you must first “get to know them”. The questions, “who is my customer” and “what does he want?” became the primary reason for the birth of CRM.

The CRM of today, just as any species that survives eons, has gone through some serious evolutionary processes. Are all the new “fingers and toes” necessary for the auto dealer of the 21st century? This blog will attempt to shed some light on that.

Just as the auto industry has gone from single franchise unit dealerships to multi franchise conglomerates, the CRM which serves them has gone from simple local network-based tools that only worked with sales customers to complex web-based tools  that considers the entire life cycle of the customer with the dealership.

In this blog, I will discuss what the CRM of today looks like, and in later blogs, I will dissect the functionalities that are and will be the “true” core functionalities, and those that are peripheral and might not be there in the near future.

The most common characteristics of a truely robust CRM of today, is that it must be web based, an enterprise level tool, and offer a comprehensive feature set. What does all of this mean? As the dealer body has evolved into multi-unit dealerships, the CRM has to be able to handle multi-unit companies with many dealerships. The CRM of today must be able to provide a”company level” database with appropriate rights and privileges. It must be web based as the end user will be able to take advantage of a much more powerful tool without having to truly” foot the bill” for using it and lastly, “comprehensive” means a tool that can tell the end user every aspect of the interaction of a customer with every member of the dealership team.

From these roots a tree can rise with many branches. Some of the branches, the tree cannot do without, but many are not needed and just sap the nourishment from the root. In further blogs we will dissect this tree further and discuss the most pertinent parts of a robust CRM.

Stay Tuned!