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Customer Experience

Customer Relationship Management

(CRM) vs Customer Experience
Management (CEM)
Jan 12, 2022

Customers are the essential ingredient for any business. As we know, their
experiences and perceptions can make or break a product, service or brand, so
it makes sense to focus on the relationship we have with them, and the
experience we’re delivering. However, customer relationship management
(CRM) and customer experience management (CEM) are commonly confused Find out
— although both are crucial to customer satisfaction and retention, their
why 99% of
functionalities and objectives are not the same. 
users rate

CRM vs CEM: What’s the Difference? us 4+ stars

S E E O UR
It’s all in the name. Building upon ‘relationships’ and building upon ‘experience’ SCO RE S >

are two separate concepts, which require two separate approaches. 

So let’s break it down. 

You can think of customer relationship management as a ‘lead machine’ or

‘lead database’. CRM helps you manage customers, whether they’ve only just More on
been introduced to your brand or if they’ve been a lifelong customer. CRM This Topic
software profiles customers so you can understand how they became a
customer, how frequently they buy from you, what their average order size is Our

and how they interact with your brand. The goal of a good customer Community’s
Most
Important
 Important
relationship management system is to nurture customers from prospects to
Are Your
Customer
raving fans. 
Policies
Experience
Negatively
Goals for 2023
On the other hand, customer experience management is a strategy that tracks,
Affecting Your
analyzes, controls, and (ideally) improves interactions with your customers at
Customer
every touch point. CEM analyzes the overall customer experience by collecting
Experience?
nitty gritty behavioral and experiential data as well as direct feedback. The
data represents the perceptions that customers have across all interactions
How Service
with an organization. 
Brands

While CRM and CEM work together to increase repeat business and referrals, Measure
Customer
there are some key differences:
Experience
CRM VS CEM  Success

A CRM tracks the company’s view of a customer, while a CEM tracks a

customer’s view of the company.

A CRM focuses on the sales funnel while CEM focuses on touchpoints.

Customer touchpoints are your brand’s points of customer contact, from
start to finish. Examples include your point of sale, bill payments, and
customer support agents.
Ready to
level up
Whilst CRM data is centered more on customer transactions, CEM data
is centered more on more granular behavior and overall customer your
satisfaction. customer
In a nutshell, a CRM manages the customer and a CEM enables them!  experience?

BOOK A DE MO

Understanding Customer Relationship >

Management
So now that you have a basic understanding of the differences between CRM
and CEM, let’s dive deeper. 

CRM crash course incoming. 

By definition, customer relationship management is a system or software that

is used for managing all your company’s relationships and interactions with
customers and potential customers. A CRM system helps companies
understand their customers, nurture leads, automate processes and increase
profitability.

The objectives of CRM are: 

Maximise marketing efforts.

The more you know about your customers, the better. A CRM system
helps marketing teams identify and target leads from a central organised
location and offers campaign management, tracking response and
detailed analytics all under one roof.

Close more sales.

With greater access to customer information and a centralized place for

tracking leads, a CRM system automates administrative workflows
traditionally carried out by sales representatives, allowing teams to close
deals faster with more efficiency.

Improved customer support.

By centralising customer data and sharing knowledge, organisations are

able to act upon customer requests with a high level of personalization
which results in a greater connection between the customer and
organisation. 

What about the key functions? 

Mining and analysing data

If you’re known to geek out a little on graphs, data and spreadsheets,

you’ll very much get a kick out of the data capabilities that CRM tools
offer. Every ounce of information you’ve ever collected about a customer
is stored on a CRM software, so you can track and analyse to your
heart’s content.

Reporting & analytics

 Reporting and analytics is required across all major business functions.
CRM analytics, also known as customer analytics, refers to the process
of interpreting the data within your CRM software to uncover all those
golden insights that will impact business decisions, marketing
campaigns, coaching methodologies and more.

Lead management

A customer that’s just heard of your business has different needs to a

customer that’s been with you for years. A CRM helps you generate,
manage, qualify and nurture leads, so you can manage the relationship
effectively and in a timely manner.

Document management

Collect, upload, store, and share documents in a centralized location.

You’d think this would be a given in 2022 but ‘you don’t have access to
this document’ is an all too familiar message. Easy access to important
documentation ensures teams are in the know and promotes a smooth,
consistent experience for your customers.

What are CRM systems?

Salesforce, the world’s #1 leading CRM software defines their product as
“technology for managing all company’s relationships and interactions with
customers and potential customers.”

The goal of a CRM is simple: improve business relationships to grow your

business.

A CRM system helps businesses keep customer contact details up to date,

track every customer interaction, and manage customer accounts.

“CRM is the largest and fastest-growing enterprise

application software category, and worldwide spending
on CRM is expected to reach USD $114.4 billion by the
year 2027.” - Sales Force
Companies are now realizing the importance of adopting a CRM early to
succeed in delivering five star customer experiences. CRM companies
dominating the market include: 

1. Salesforce 
2. Microsoft Dynamics
3. NetSuite

How does a CRM benefit a business?

While the true benefits of implementing a CRM will vary by industry, the
general benefits include: 

Increase sales

Research from Salesforce indicates that CRM software can increase

sales by as much as 29% while improving sales forecasting accuracy by
up to 32% and improving sales productivity by 39%.

Improve efficiency

CRM boosts productivity because the software is designed to overcome

common operational obstacles. Ah, the beauty of automation.

Streamline sales processes

Access to data insights is fast becoming a key differentiator for top

sales teams. Research conducted by Aberdeen Group shows 24% more
sales reps will achieve their annual sales quota thanks to CRM access.

Maintain clear customer profiles

Salesforce states 81% of sales reps believe it is important to have a

connected view of data across the entire customer journey. This means
connected processes such as seamless handoffs between departments
and organization-wide knowledge of a customer’s sales and service
history are crucial.
Understanding Customer Experience
Management
CRM knowledge, check. Let’s move on to CEM. 

Customer experience management (CEM) is the processes a company uses to

track, oversee and organize every interaction between a customer and the
organization throughout the customer lifecycle and journey. 

Customers no longer base their loyalty on price or product. Instead, they stay
loyal with companies due to the experience they receive. In fact, 86% of buyers
are willing to pay more for a great customer experience.

The objectives of CEM are to: 

Optimize the customer’s experience with the company as an entity

CEM uses experiential data to deliver on the things that matter most to
customers. When customer’s expectations are met, or better yet
exceeded by a company, the experience is optimized.

Foster customer conversion and retention

Customer experience → Loyalty → Growth. CEM helps you build a loyal

customer base who spend more with your business, and refer their
friends and family.

Improve brand image

When you improve customer experience for a single customer, their

perception of your brand increases. When you improve customer
experience for your entire customer base, you become known as the
best in the business.

What about the key functions? 

Oversee customer interactions at every touchpoint

 CEM tracks, analyzes, controls, and improves interactions with your
customers at every touch point. Examples of touchpoints where a
customer interacts with your brand are your point of sale, bill payments,
and customer support agents.

Gather experiential data to understand customer perception

CEM analyzes the overall customer experience by collecting nitty gritty

behavioral data and direct feedback. The data represents the
perceptions that customers have across all interactions with an
organization. 

Create a customer-centric brand culture

CEM works to create a customer centric brand culture. When you’re

constantly fine-tuning your experiences to meet the needs of your
customers, you subsequently create a culture that is customer
obsessed. 

What is CEM software?

Customer experience management software is an invaluable tool used to
measure customer loyalty, understand how to best respond to their needs and
ultimately take the necessary actions to improve customer experience, and
therefore customer retention. 

CEM software: 

Helps improve customer experience through combining behavioral

analytics with automated engagement and satisfaction surveys.

Integrates with CRM software for a detailed understanding of your

customers and how to reach them.

Stores data in a way that is secure and easily navigated by your team.

Essentially, it automates, streamlines and keeps everything in one place. 

How does a CEM benefit a business? 

Here are just some of the benefits of CEM:

1. Strengthen Brand Preference: Customers have more options than ever,

and they know it. When you focus on customer experience management,
and exceed customer expectations, you become the preference over
competitors.

2. Boost Revenue: An awesome customer experience means your

customers will spend more. In fact, 86% of buyers are willing to pay more
for a great customer experience.

3. Reduce Costs: Focussing on CEM is a more efficient way to grow. The

cost of acquiring a customer is 5 times more expensive than retaining
one.

4. Personalize Engagement: When you understand exactly what your

customers want, you can tailor your experience to meet their needs.

5. Improve Customer Loyalty: Customers no longer base their loyalty on

price or product. Instead, they stay loyal with companies due to the
experience they receive.

Image Source - Survey Sparrow

How CRM & CEM Work Together?

Now we understand the objectives and purpose of CRM & CEM individually,
let’s explore how to create harmonious connections between them both to get
the most out of your customer data, and win on customer experience. 

To recap, the shared objectives of CRM and CEM are to: 

Deliver a better understanding of behavior through detailed data

Improve and build upon customer relationships

Foster customer retention in order to drive sales and growth 

In essence, both aim to make the interaction between the customer and the
vendor as smooth and enjoyable as possible. A CRM system focuses on
managing the process from the employee’s perspective and a CEM manages
the customer’s side. The combination are both necessary for delivering
awesome experiences. 

Integrating the brand view of customers (CRM) with customer view of brand
(CEM) creates a more holistic understanding of a company’s strengths and
performance.

In Summary
The multifaceted nature of customer experience requires a multifaceted
approach to management. There are many moving cogs, but with the right
tools in place managing your customers and their experience can be a
streamlined, methodical process. 

Remember, building upon ‘relationships’ and building upon ‘experience’ are two
separate concepts, which require their own unique approaches. Both
approaches rely on smart strategy as much as it does on smart software
solutions. Both are necessary if you're going to effectively manage customer
experience and ensure nothing slips through the cracks. 

Building upon and improving customer experience starts with investing in the
right solutions. Join thousands of companies who use AskNicely to win on
customer experience. Book a Demo today.
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