17 April 2017

What’s the Difference Between CEM and CRM, and How Can They Work Together For My Business?

Customer experience management (CEM) and customer relationship management (CRM) are not one in the same. While both concepts are crucial elements of keeping your customers happy, and have technological solutions for gaining insights on your customers through the power of data, they are different as it pertains to managing your customer and prospect base.

CRM and CEM have different functionalities and objectives when it comes to the parts they play in managing the customer experience. CEM is more of a methodology or holistic approach that monitors and attracts customers through a great experience. CRM is generally more of a platform or software solution that allows organizations to track customer and prospect interactions, to drive sales and insight, and to resolve issues.

Finding the right mix of CRM and CEM is an important piece of the puzzle when it comes to keeping your customers happy, but it’s also crucial to understand the difference between the two concepts. Here’s what you need to know about CRM and CEM and how you can leverage your business growth by providing an exemplary customer experience.

CRM and CEM: What They Mean For Your Business

Group-on-devices2CRM’s primary goal is to retain existing customers by maintaining then improving your company’s relationship with them. CRM is a technology in and of itself (software and platforms) but also refers to the best practices and strategies for building customer relationships and keeping churn rates (customer loss) down.

CRM platforms, like Salesforce, Microsoft Dynamics, and NetSuite, use the power of data to analyze and track customer behavior: how they became a customer, how often they buy from you, how much they spend, the way they interact with your website and other parts of your online presence such as service interactions, and other aspects of the customer journey and lifecycle.

CEM on the other hand focuses on gathering and utilizing experiential data from customers. Gartner defines CEM as: “the practice of designing and reacting to customer interactions to meet or exceed customer expectations and, thus, increase customer satisfaction, loyalty and advocacy.”

The objective of CEM is to gather, track, and organize all steps of the customer journey and lifestyle through the customer’s perspective. Through reviews, surveys, direct feedback, and other ways of communicating directly with customers regarding their experience, this data is used to improve processes and the customer experience. This bolsters customer loyalty and can even help the organization run more efficiently.

In short, both CRM and CEM optimize customer relationships but CRM is what facilitates relationship-building for the organization while CEM focuses on monitoring and improving the experience for the customer. Both CRM and CEM account for all steps of the customer journey and their interactions. However, CRM is more transactional by tracking metrics like how much a customer spends on average per order and what categories of items they purchase while CEM is experiential: regardless of amount spent, did the customer have a good experience shopping in your store or placing an order on your website? Do you know how they like to communicate? What their concerns are?

How Good CEM Practices Can Help You Address Shortfalls in Your Business Systems

Laptop-and-coffeeWithout customers, you don’t have a business. Their experience is just as important – if not more important – as how much they are spending and how responsive they are to your marketing campaigns. If customers aren’t returning to your business because of a bad experience, that can also be indicative of needing to update, change or replace aspects of your infrastructure, like your contact center systems and processes.

Responding to customer feedback is critical to providing an excellent experience and determining where you have shortfalls that need to be addressed. Many companies find themselves between a rock and a hard place just when it comes to receiving feedback by itself: Forbes found that 66% of customers prefer to actively reach out to provide feedback, as opposed to being prompted to answer an incredibly long survey that doesn’t compensate them for their time (of which Forbes also found they don’t want to spend more than three minutes on a survey.)

Keeping track of the customer experience becomes so much more vital as all manner of feedback needs to be accounted for. This is when it’s time to adopt a CEM approach and address deficiencies in your systems and internal business operations before it begins to really impact your business, or you fall significantly behind to your competitors.

Are customers abandoning shopping carts because the current cart system isn’t user-friendly? Do they find themselves getting stuck in endless loops trying to speak to customer service so they’ve parted ways with their money?

A proper CEM system can keep track of this activity for you while a CRM helps track and automate the relationships.

The Path Forward to Reach Your Customer Experience Goals

know-your-customer-stickynoteCEM and CRM are not one in the same. CRM focuses on facilitating your relationship with customers while CEM works through the customer’s viewpoint to assess the quality of their experience.

A CRM platform is an important investment since it keeps track of crucial data for your inbound marketing and sales efforts and analyzing customer behavior. Investing in a solid CEM process is also an incredibly strong investment so that you can have a more thorough overview of the customer journey and how you can improve it.

By harnessing the power of your customer data, you can get a clearer picture that improves the their overall experience and drives sales growth. Knowing where your deficiencies lie, provides insight for prioritizing changes to your business systems, and your customers will often be very vocal about this if they are having issues.

Make sure you have the systems and processes down to support CEM. Get a third-party assessment to review your technology, your processes, and your objectives. You can then create a roadmap to implement and integrate the right tools to reach your business goals and keep your customers happy.


Take the Next Step to Knowing Your Customer

An objective assessment of your current processes and technical environment can get you started to truly knowing your customer. Find out more about how you can get the 360 degree view of your customer. 

Authored bY

Mark Pendolino

Mark Pendolino is the Director of Marketing at PTP, overseeing the creation of customer experience content focused on helping organizations discover best practices for evolving the customer journey. Prior to PTP, Mark managed teams for companies such as Microsoft, Smartsheet, Fujitsu, and Parsons Brinckerhoff. Mark holds a master’s in Communication in Digital Media from the University of Washington, and a bachelor’s in Technical Communications from Metropolitan State University of Denver. In his downtime, Mark likes to thrash a bit on the drumkit and pretend he’s a rock star.


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