CRM-Database-Management

How Small Business Can Manage Their CRM Database

Posted by RudyS

Customer related CRM database provides an insight on the customer behaviors not only to enterprise users of the system but also is a vital piece of information for users of CRM for small business. Rather to say, the database is the foundation on which the CRM software strategies work. As for all businesses, the customer-related information base is one of the most important characteristics that impart the customer-based tactics and strategies needed for optimal use of this system.

Hence, the database is one central prerequisite that supports all types of best CRM solution that are available, such as CRMs used for Strategic, Analytical, Operational or Collaborative purposes.

What is the meaning of Customer-Related Database?

Be it a Server based or Web CRM, for all kinds of infrastructures, the customer-related database is the collection of customer-related information, which focuses on current and future opportunities along with historic sales data of an organization.

The maintenance and updating of this database are done by a number of functional departments in an organization, such as sales, channel management, product management, customer support, accounts, and others.

Information those that are stored within the CRM database are customer information containing fields like:

  • Name
  • Address
  • Contact details
  • Contact preferences
  • Age
  • Marital status
  • Birthday
  • Anniversary
  • Professional and social status
  • Purchase history
  • Customer support information and others

For example, a sales manager who is using sales CRM can ideally record past transactions, opportunities, product preferences, customer support issues, accounts data and others vital information using a Customer Management System platform. Similarly, channel managers can record online retail information, details of business-owned retail outlets and product managers may document product preference, and product category explored, products within a specific price band sold and others.

Types of CRM Database

Irrespective of whether you are using a Server based or a Cloud CRM, based on respective purposes CRM database is classified into two types:

  • Operational Database
  • Analytical Database

This means operational data of a CRM resides in OLTP (Online Transaction Processing) database, while analytical data of the system resides in OLAP (Online Analytical Processing) database.

How Can You Develop and Maintain Customer-Related Database?

The database in a CRM is a storehouse of a collection of files (or tables), which contains a series of records (which are rows of the table) that in turn incorporates a number of fields (which are columns of the table). In each of these files information such as of customer, products, sales, and others are stored within the CRM system.

Here is a visual illustration of the steps that are followed for creating and maintaining a customer-related database:

All best CRM vendors suggest that this database always needs to remain up-to-date for maintaining the accuracy of the data.

Types of Customer Data

Be it a Sales CRM or a Customer Support CRM meant for an enterprise solution or a CRM for small business, there are principally 2 types of CRM data:

  • Primary
  • Secondary

This ‘primary’ data in a CRM is the data, which is collected initially for the first time, while the ‘secondary’ data is the information that has been collected previously.

The users of the CRM generally collect the primary data by conducting surveys, inviting customers to subscribe to newsletters, holding a skill competition or while registering their customer’s purchases and others.

All modern CRM software works on Relational Database architecture that is composed of tables that incorporate rows and columns. In this, the tables are connected to other tables with the help of a unique identification number, which is named as the ‘primary key’ and is stored in the ID field.

Database Management for CRM

Several database management systems are available in the market today. Some of the most popular DBMS are:

– Oracle

– Microsoft’s SQL Server

– DB2 from IBM and others.

These systems help to administer and update the CRM’s database.

Hardware Needed For CRM Database

The parameters of the hardware platform on which the CRM database will reside is chosen based on the following criteria:

  • The existing technology used in the business
  • The size of the database
  • The location of the users of the CRM

Data Attributes

The CRM data stored in the CRM’s database must comply with the following attributes:

  • It must be shareable (as several people may need to access it from different geographical locations)
  • It must pertain to a given purpose and so must be relevant
  • It should be accurate (For this data should be reviewed in a timely manner while acquiring and entering data into the system)

Data-Warehousing (DW)

All CRM database consists of Data-Warehouses, which are a huge collection of customer-related data, which are received from several sources. The Data-Warehouse repository can be as big as a few Terabytes.

There are a plethora of global businesses operating from several continents and countries that generate a gigantic volume of data. However, this data needs to be converted into useful information for subsequent operations and analysis.

A Data-Warehouse does this work by:

  • Transforming the data into a required format before loading it into the database
  • Organize the data chronologically and according to the subjects of the business
  • Standardizing the data into a single format which are coming from various sources
  • Conduct periodic updates of the data (This is not performed in real time)
  • Provide updated data for the purpose of data mining, analytics, and reporting

Data Access and Interrogation

CRM is a system that allows users to interact with the database.

This data access and interrogation are performed in the following 3 ways:

Data mining

In the context related to CRM database, data mining is the application of predictive analytics that supports sales, marketing, and services. It finds an association among different datasets and classifies the customers according to their business value to answer the following questions:

  • Which customer your business should target?
  • What is the cost of your customer acquisition?
  • Which customers are buying and not buying your products?
  • Why some of your customers are becoming defaulters regularly?
  • Who are your low, medium, and high margin customers?
  • How can you segment your business market?

For organizations that use CRM for small business and even for large enterprises data mining is an excellent tool that can provide relevant data to the marketing and sales team of a company for marketers’ analysis, which is required for generating sales volume, and subsequently increase ROI.

Database Queries

The queries are tools that help you to access and modify your CRM’s database. SQL (Structural Query Language) is used as a standard language for relational database management system. These SQL queries come in the form of statements such as:

  • SELECT
  • ADD
  • DELETE
  • UPDATE
  • DROP, etc.

Reports

All Customer Relationship Management applications generate reports on a regular periodic manner for analyzing the quality and traits of performance, sales, and many other related activities. The management of an organization, for performance assessment, mostly accesses these CRM generated reports.

OLAP (Online Transaction Processing) technology used by CRM is capable of depicting data at the lowest levels that of a sales rep or of a complete region, which aids in assessing the performance of the champions and question the underperformers in a company.

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What is the position of the CRM system in respect to its Database?

While analytical CRM does work most strongly with the customer’s database, the strategic CRM do work furthermost from the system’s database.

Here is a visual illustration to elaborate the statement:

If you have found this article useful in understanding the CRM database structure, which works for your CRM for small business as well as for large enterprises, we would be happy to know of your comments below.

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