Unless you do business on Gilligan's Island, it's difficult to overstate the importance of reliable, up-to-date contact information.
In fact, in study after study about the elusive art of customer-relationship management, two facts can't be disputed. First, there is without question a link between your company's profits and accurate customer information — a point bolstered by a 2005 Siebel Systems, Inc. survey which found that almost half of small and medium sized businesses (46 percent) cite growing revenues and maximizing margins as their top business objective. In alignment with this goal, more than half of European SMBs are investing in some kind of customer management tool to help them retain and attract customers to fuel this growth.
And second, keeping that critical customer information up-to-date is a lot harder than it looks. A Data Warehousing Institute study found that contact data changes at the rate of 2% to 3% a month. In other words, a database that is accurate today will be somewhere between 25% and 36% out-of-date within a year.
"We get about 45% of our sales directly from our database," says Jacques Werth, the president of High Probability Selling, a Dresher, Pa., sales consulting firm.
Do the math. Even if your business derives half of that from its database, can you really afford to kiss all those clients goodbye?
Didn't think so. However, you may be in the minority, according to the experts.
"Most small business would view things like equipment, inventory and patents as strategic assets worthy of investment," says John Gravel, chief executive of c360 Solutions, an independent software vendor that supports Microsoft CRM, an advanced solution for managing customer data. "At the same time, most small-business owners, when asked, would agree that customer data is a strategic asset in their business. However, ironically, most small businesses invest very little in their customer data."
So how do you manage those contacts like a pro? Specifically, how do you keep those contacts you've got stored in Outlook 2003 primed, polished and ready for action? Here are six strategies:
1. | Scrub your contacts — really hard. If the information in your contact files isn't accurate to begin with, then it will lead to mass confusion — and lost business. "I might know a contact as John Doe," says Barry Solomon, the executive vice president for Interface Software, a CRM services company in Oak Brook, Ill. "My colleague might know him as Jack Doe, and another may know him as J.S. Doe. Unless these inconsistencies are managed, there's a real danger of miscommunications, such as duplicate mailings, which can damage the relationship." (As someone who is frequently on the receiving end of such letters, I can vouch for that.) Tip: The most effective way of making sure everyone in your company is on the same page is sharing company contacts through Outlook 2003. Go to the Navigation Pane in Contacts and click on Share My Contacts. (You have to be using an Exchange Server e-mail account.) Consider conducting a periodic top-to-bottom review for quality control, since Outlook will only catch new contact files with the same name or e-mail name as one that already exists in your contacts. |
2. | Keep 'em separated. Contacts love chaos. They're drawn to it, somehow. Professionals know that good data alone isn't enough. "Don't forget to categorize your contacts," says James Wong, president of Avidian Technologies, and an Outlook expert. "There is a powerful feature in Outlook that allows you to group your contacts. For example, you might want to group your contacts as prospects, customers or key customers. You can then view by each category and use that category to remind you to call each customer or do mail merges to that specific group of contacts." But just as important, grouping contacts in that way offers yet another way of organizing them, which prevents errant entries that no one in your company knows what to do with. Tip: Creating a new category is easy in Outlook 2003. On the Edit menu, click Categories. Go to the Master Category List, and in the New category box, type a name for the category. Then click Add and OK twice. |
3. | Store more than names and numbers. And encourage your employees to do the same. "The data in your contact file can be much more than names and numbers," says Brian Olson, a director for the Video Professor (www.videoprofessor.com), which offers training courses on Outlook 2003. "Keeping data about a company's birthday, for example, can provide you all sorts of opportunities, especially using the Outlook calendar." For example, knowing that a company's birthday is a few weeks out can give you a leg up in marketing because you can contact the company to congratulate it on surviving another year. Tip: You can create a custom field to store information that's specific to your industry in Outlook 2003. On the View menu, go to Arrange By, click on Current View, and on Customize Current View. Click Fields. Then click New Field and enter the information you want. |
4. | Develop a clear follow-up strategy that relies on several channels. "You need a clear follow-up process," says Colin Goldberg, who created BizConnector, an Internet-based service that helps automate your customer connection. "And you need to maintain the relationship through a number of channels, including phone, meetings and newsletters." Now this may seem pretty common sense, but you would be surprised at how many businesses rely too heavily on one medium — say, the Internet — while completely ignoring other perfectly valid channels to maintain and nurture a business relationship. Tip: Needless to say, Outlook 2003 will help facilitate contact through phone and mail — although that's often easy to forget. Want to make a phone call? In Contacts, click the contact you want to call. Go to the Actions menu, and click on Call Contact. Ditto for letters. See this demo for how to create a toolbar for quick sales letters. |
5. | Make optimum use of Business Contact Manager. You have most of the above functionality and more if you utilize Outlook 2003 with Business Contact Manager, which is in included in both Microsoft Office's Professional Edition 2003 and Small Business Edition 2003. Tip: Outlook 2003 with Business Contact Manager allows you to create opportunity records in which information about the contact is stored, including information that is entered on the opportunity form, linked records, and history items. If you already have Business Contact Manager, go to the Business Tools menu, click on Reports, point to Opportunities, and then click the type of report that you want to create. (For more on Outlook 2003 with Business Contact Manager, see this article.) |
6. | Don't be afraid to go outside the proverbial box. No two businesses are exactly alike. So why should you manage your contacts in exactly the same way? "Remember, one size does not fit all," says Andrea R. Nierenberg, author of "Nonstop Networking: How to Improve Your Life, Luck and Career." "Allow your team to use the system in ways that work for them, for the ultimate goal of keeping track of clients, prospects, referral and sources to run your business to the maximum efficiency," she says. That can mean finding third-party solutions that automate the contact-management process or that enhance the functionality of Outlook. Tip: There are dozens of third-party applications that can enhance your contact-management software (for more on specific applications, see this page). In addition, numerous Internet-based applications, such as BizConnector (www.theBizConnector.com) can help you as well. |
By keeping your contact information clean, categorized and rich with relevant data, you can vastly improve the effectiveness of your company's sales efforts. But don't rely on just one medium, or for that matter, tool, to get the job done.
Think of your contacts as you would, well, another employee.
"A contact database needs to be treated as a living breathing organism," says Jeff Bowling, president of Telxar, a Sparks, Nev., information-technology company. "You need to feed it, secure it, and use it effectively."
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