5 effective CRM models to boost customer experience

How you approach customer relationship management (CRM) influences diverse processes, from product development to marketing. An effective strategy ensures that you get the most value from each customer and that they feel satisfied with their experience.

CRM models can help you build a strategy that maximizes performance in both aspects.

In this guide, we’ll explain five of the most popular CRM models and how to use them to boost customer experience and generate more revenue.

What is a CRM model?

A CRM model is a framework that defines your approach to customer relationship management. It outlines processes that make building and nurturing customer relationships easier.

Implemented successfully, a CRM model acts as a blueprint that focuses and streamlines your CRM efforts. It ensures your approach delivers excellent customer experiences and contributes to long-term business growth.

It guides improvements to activities like customer acquisition, management and retention, so you can win and keep customers more reliably.

A CRM model is similar to a CRM strategy, except that the term CRM strategy generally refers to a bespoke approach. At the same time, there are several established CRM models to choose from.

They provide guidelines for the entire customer relationship management process, which often includes how to set up and use CRM software to the best of its ability. However, they mainly entail broader aspects of CRM, like personalization and measurement.

5 most effective CRM models

Businesses use several notable CRM models to improve their customer relationship management.

Each approaches the problem of analyzing and refining your CRM strategy slightly differently. Some prioritize relationship building, for example, while others focus on making processes more efficient.

Here are five of the most common CRM models with a reputation for effectively boosting CRM results.

1. Identify, Differentiate, Interact and Customize (IDIC)

The IDIC CRM model is designed to help businesses gain a deep understanding of their customers’ needs, making it easier to develop long-term customer relationships.

Peppers & Rogers Group, a management consulting firm specializing in customer-based business strategy, is credited with creating it.

The model provides a four-part blueprint for implementing a better customer relationship management process:

1. Identify. Collect information about your customers. Include data covering their demographics, preferences, behaviors and pain points. The aim is to develop a complete picture of your customers and their wants.
   

2. Differentiate. Segment your customers based on shared traits. For a B2C business, the trait could be age. For a B2B one, it might be company size. You can then prioritize customer segments based on their potential value.
   

3. Interact. Interact with customers throughout the marketing and sales funnel. Customize your approach based on your differentiation strategy to help you build customer trust. Over time, you’ll learn which strategies are most effective with each segment.
   

4. Customize. Refine your approach to develop more granular strategies as you learn from customer interactions. Targeting increasingly smaller segments or individual customers means you can accurately address their needs.

The IDIC model is effective because it recognizes that all customers are different. Following the framework makes identifying and addressing differing needs and preferences easier, which helps build stronger, more reliable customer relationships.

2. Quality Competitive Index (QCI)

The QCI model emphasizes the management element of customer relationship management. It focuses on streamlining the process of acquiring, onboarding and serving customers.

It was developed by QCi, a specialist customer management consultancy, and referenced by QCi’s Neil Woodcock in a 2002 research paper. The paper focuses on practical ways to generate ROI by improving customer management.

The QCI model provides a framework for businesses struggling to make tangible CRM improvements. It involves eight main components:

1. Analysis and planning. Create the foundation of a QCI CRM model. Set objectives and use a mix of existing data and personal experience to form a customer management strategy.
   

2. Proposition. Identify what your specific proposition offers your target customers and how that might affect your approach. For example, if you’re the most expensive option in the market, you might be expected to have outstanding service.

3. Information and technology. Analyze technology’s role in your customer management process and how to improve it. For example, your CRM software might offer a live chatbot feature, which can decrease your query response times.
   

4. People and organization. Develop internal processes for managing customers. Stakeholders like salespeople and customer service reps should understand how their role fits your CRM strategy.
   

5. Process management. Move customers through a process as you nurture, acquire, onboard and manage them. This stage of the QCI model involves analyzing that process to identify areas to streamline and boost customer experience.
   

6. Customer management activity. The QCI model breaks customer management into three sub-processes: acquisition, penetration and retention. In this component, you should develop these processes to suit the objective you set in the first step.
   

7. Effect measurement. Track the impact on key performance indicators (KPIs) as you implement your new CRM model. Changes to conversion rate, revenue and customer retention rate will help you understand how successful your approach is.
   

8. Customer experience. Seek customer feedback to understand their perspectives on your management approach. Any learnings can feed back into the system, helping you to continuously improve your CRM strategy.

The QCI model is notable for its comprehensiveness. It covers diverse aspects of customer management, helping you align all stakeholders in a single holistic strategy.

It also recognizes the importance of continuous learning and improvement, which is critical to building a CRM strategy that delivers long-term success.

3. CRM Value Chain

The CRM value chain model provides a framework that helps businesses identify and prioritize customer needs to build stronger relationships.

It’s the brainchild of Francis Buttle, who described the approach to the customer relationship management process in a 2001 Marketing Business article.

Buttle’s model proposes two elements to successful CRM: five “stages” and four “supporting conditions”.

The primary stages he describes in the framework are:

1. Customer portfolio analysis. Analyze your customer base to identify what customer types offer the most value. From another perspective, this means deciding which customer profile your business can serve best.

2. Customer intimacy. Collect data that helps you understand ideal customers in detail. The CRM value chain model emphasizes data that allows you to understand their behaviors, which allows for easier targeting.
   

3. Network development. Align your entire organization with your new model, which could involve retraining some staff and choosing a new CRM software.
   

4. Value proposition development. Identify and develop your business’s specific value proposition. It should describe what unique value you can offer your customers and serve as the guiding principle behind your CRM strategy.
   

5. Relationship management. Update processes and policies to suit customer needs and empower customer-facing teams to provide better experiences.

The supporting conditions outlined in the CRM value chain model are critical pieces of infrastructure that facilitate a streamlined CRM process. They are:

• Culture and leadership

• Procurement processes

• Human resource management processes

• IT/data management processes

• Organization design

Implementing this model involves redesigning your CRM process to address the importance of each stage and ensuring all supporting conditions are optimized to suit your CRM objective.

4. Payne and Frow’s Five Processes

The Five Processes CRM model defines five crucial elements of an effective customer relationship management strategy. It emphasizes a cross-functional approach that treats CRM as an organization-wide effort.

Marketing professors Adrian Payne and Pennie Frow outlined the model in their 2005 journal, A Strategic Framework for Customer Relationship Management.

The five processes included in the model are:

1. Strategy development. Define a CRM strategy that aligns your business objectives with your customers’ needs. It should touch on diverse operational aspects like pricing, marketing and customer service.
   

2. Value creation. Use your strategy as a North Star to determine how to deliver value to your customers. It may involve developing new products or using personalized sales approaches to suit different segments’ needs.
   

3. Multichannel integration. Align all your channels in the context of your new CRM strategy to ensure customers get a consistent experience throughout the funnel across diverse platforms.

4. Information management. Develop a strategy for collecting and analyzing customer data. This data offers insights that can assist you in decision-making and personalization. CRM software typically facilitates this process.

5. Performance assessment. Refine how you measure and assess CRM performance. It might mean setting new KPIs, but it can involve more sophisticated initiatives like tracking customer satisfaction through regular surveys.

Payne and Frow also developed a four-step procedure to guide companies in implementing a new CRM model. They identified the following areas to focus on:

1. CRM readiness. Evaluate your business’s preparedness for implementing a new CRM model. Analyze your current systems, processes and culture to pinpoint areas that may cause difficulties as you move forward.
   

2. Change management. Effective CRM model implementation requires proactive change management, including updating workflows and upgrading your technological capabilities to match the demands of your new CRM model.
   

3. Project management. Establish a team dedicated to overseeing the CRM model project, defining the goals, planning a timeline and allocating resources to ensure it goes smoothly.
   

4. Employee management. Once you’ve implemented your new model, focus on bringing all stakeholders up to speed with training. This is particularly important for customer-facing roles, like sales or customer support teams.

Together, Payne and Frow’s Five Processes CRM model and implementation procedure provide a complete guide to reinventing your CRM strategy.

5. Gartner’s CRM Model

The CRM model developed by renowned market research firm Gartner highlights eight critical components of effective CRM implementation. Applying the model to your business can help you find specific areas to optimize your existing strategies and infrastructure.

The eight components covered by Gartner’s CRM model are:

1. CRM vision. Establish clear long-term customer relationship management goals that align with your business objectives. For example, your goal might be increasing loyalty to retain customers longer.

2. CRM strategy. Form the outline of a strategy based on your vision. It should cover value proposition development, a summary of how you’ll engage with customers and an analysis of how your actions will feed into your central goal.

3. Customer experience. Gather customer feedback to help you understand their thoughts on your current approach to CRM. These insights will guide improvements tailored to your customers’ specific preferences.

4. CRM processes. Refine core CRM processes like lead outreach, sales pipeline management and customer complaint resolution. Focus on streamlining these processes to boost efficiency and maximize customer satisfaction.

5. CRM information. Outline what customer information you want to collect and how to store it for easy access. The best CRM strategies rely on good customer data that facilitates effective segmentation and personalization.
   

6. CRM technology. Consider how technology can help you achieve your CRM objectives. CRM software like Pipedrive, for example, offers automation features, a customer information management solution and more.

7. CRM metrics. Track the right metrics to ensure you can measure the effectiveness of your CRM approach. Choose key performance indicators (KPIs) that relate to your overall objective.
   

8. Organizational collaboration. Align departments to create a consistent approach to customer service across sales, marketing and customer support.

Using the Gartner model to update or build a new CRM strategy will ensure that the end product combines the most critical elements of CRM.

You’ll have a clearly defined long-term vision articulated in a strategic overview, processes and technologies tailored to customer needs and metrics that allow you to measure success and improve further.

Why you need a CRM model

Your approach to customer relationship management is too influential on business success to neglect. A CRM model helps you refine your CRM strategy to suit your customers and business objectives.

Depending on your aims, this can have diverse, tangible benefits. Using one of the models above to review and improve your CRM strategy can result in:

• Streamlined processes. A CRM model forces you to analyze the processes that make up the entire customer journey, offering an opportunity to streamline them for more efficient customer acquisition and management.
  

• Improved CRM strategy adherence. Defining your approach with a CRM model ensures everyone involved with customer acquisition, management and support works from the same “rulebook”, increasing adherence to your ideal CRM strategy.
  

• Increased customer lifetime value (CLV). CRM models improve how well you meet your customers’ needs. Implementing one creates more satisfied customers who are more loyal, extending the customer lifecycle.

You could get the same results from thinking about your approach to CRM without applying a formal framework. However, using an established model ensures you don’t miss any important elements that could drive success.

Setting up your CRM model in Pipedrive

Whatever CRM model you choose, CRM software like Pipedrive can help you implement it across your organization. It offers features that simplify key elements of customer relationship management, such as information storage, marketing personalization and measurement.

For example, if you decide the IDIC model is right for your business, Pipedrive can support you at each step.

1. Identify. LeadBooster offers a variety of data capture tools that make it easy to collect information about your customers. Using customizable web forms and an always-on chatbot can provide all the insights you need.

2. Differentiate. You can create a CRM data model in Pipedrive’s customer data management software and use the market segmentation feature to create distinct segments based on specific criteria, such as demographics.
   

3. Interact. Seamlessly integrated marketing automation and sales automation features make it easy to deploy different campaigns to target each of your segments, including an email builder that lets you create beautiful templates in minutes.

4. Customize. The CRM will track all your customer interactions, allowing you to capture more valuable data at each touchpoint. Analyze this data to reveal critical insights that help you continuously improve your campaigns and convert more customers.

CRM software is at the core of modern customer relationship management. It’s invaluable when implementing a new CRM model, and the automation features in particular can drive efficiency.

For example, Pipedrive’s sales automation feature allows you to create custom automated actions. You can use this to ensure rapid first contact after qualifying a sales lead or to provide automatic updates for leads in the pipeline.

Choosing the right software to support your CRM model can boost its impact. You can capture and analyze data more easily, streamline processes and generate more powerful customer interactions.

Final thoughts

CRM is about exceeding customer expectations as customers move through the buying journey. The CRM models above are designed to help you do that, providing simple frameworks for identifying and optimizing weak points in your process.

Building around a CRM model can improve aspects of your customer strategy. It’ll ensure your marketing and sales teams have clear guidelines and solid infrastructure, making creating better customer experiences easier and ultimately driving long-term revenue growth.