What is CRM 2.0?

Web 2.0 has been impacting more than just consumers and individuals. It has been having a profound effect on the business community as well. In fact, in a recent survey conducted by The Customer Collective, a popular forum for sales and marketing executives, more than 83 percent of members claimed that Web 2.0 was significantly altering the way they do business.

What is CRM 2.0?
CRM 2.0 is an emerging concept that – although generating quite a bit of buzz – has yet to be clearly defined. However, most experts will agree that CRM 2.0 puts the Internet into play to enhance the one-dimensional interactions that are typical of standard CRM solutions. It combines the structure and organization of traditional customer relationship management technologies with the open and interactive elements of Web 2.0. The methodologies of both are blended together to create a mutually-beneficial environment of communication and information-sharing that allows the company and its clients to work together to drive the success of the business.

Key Benefits for Your Company
CRM 2.0 takes customer relationship management one giant step further. By leveraging core Web 2.0 components for the purpose of improving interactions with existing and potential clients, CRM 2.0 can offer many significant advantages. Some of the key benefits include:

• Complete, unhindered insight into the customer. By facilitating faster and more direct communication, CRM 2.0 gives companies a greater understanding of the behaviors, requirements, and interests of the people they seek to sell to.
• Smarter, more informed product and service development strategies. In the past, companies have relied on one-dimensional, potentially biased research (or in some cases “guesswork”) to create new and improved offerings. But, through more open interaction with potential buyers, businesses can gather accurate and direct feedback that can drive more intelligent decisions when it comes to new products, or enhancements to existing ones.
• More effective marketing programs. Marketing staff can gather and analyze public perceptions of certain messages and promotions in advance. This will save time and money by allowing them to “nix” bad or unpopular ideas before they are implemented.
• Enhanced customer relationships.CRM 2.0 helps to foster stronger, longer-lasting, and more profitable customer relationships in several ways. First, it allows companies and their clients to take a more collaborative approach to problem solving, working side by side to address the issues that often lead to dissatisfaction and churn.Secondly, CRM 2.0 fully engages the customer throughout their lifecycle, allowing them to participate in various business activities. And, perhaps most importantly, it enables the kind of fast, open communication that builds bi-directional trust and loyalty.

Does My Company Need CRM 2.0?
In spite of their explosive growth and significant impact, less than 50 percent of the companies polled by The Customer Collective are actually using Web 2.0 tools like blogs, wikis, or social media to improve their business operations. But while CRM 2.0 is still making its way into mainstream business environments, companies need to begin to immediately start thinking about how they will apply it as its theories mature and its techniques become more widely adopted.

Why? Because experts believe that CRM 2.0 is going to revolutionize the way organizations interact with their clients – both current and future ones. Companies that effectively utilize CRM 2.0 methodologies will gain a significant competitive advantage over those who don’t – allowing them to offer customer experiences that are far superior and build relationships that are stronger and more profitable.

Key Features of CRM 2.0
CRM 2.0 is a relatively new business discipline, and as a result, available tools and technologies to support such initiatives are few and far between. Solution providers such as Oracle and Salesforce.com have already introduced products to the market. However, until more applications become available, it remains to be seen what kind of features and capabilities will be standard among most offerings.

What to Look for When Choosing a CRM 2.0 Solution
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Although some CRM vendors are beginning to embrace CRM 2.0 concepts, they are still incorporating the needed functionality into their offerings. Those that will truly enable the implementation of successful CRM 2.0 strategies will provide:

• A centralized customer database that can dynamically collect information from any internal application or system, as well as external sources such as Web 2.0 vehicles.
• The ability to aggregate and mine that data for important key words, patterns, and trends.
• Real-time information access – including remote data retrieval and analysis – for anyone who interacts with clients.