Here’s the difference between customer relationship management (CRM) and customer experience management (CEM) — and how they’re connected.
Focused on customer experience (CX)? Then both customer relationship management (CRM) and customer experience management (CEM) need to be top of mind.
CRM and CEM go hand in hand when creating positive experiences for customers. In order to understand CX and deliver experiences that delight customers across every touchpoint in the customer journey, your organization needs to know how CRM and CEM are unique but also deeply connected.
Customer Relationship Management (CRM) is Based on the Company’s Input
Relationships between your brand and its customers are based on the experiences provided and how customers perceive the experiences through interactions.
CRM platforms are primarily based on data your company compiles about customers, using the information to build relationships and grow revenue. Although the data in a CRM platform provide a wealth of customer data that can be used in a variety of ways, CRM data is compiled and used by your company rather than the customers.
Here are some of the most commons types of information found in a customer relationship management platform:
- Name
- Contact information (phone number, email address, mail address)
- Purchase history
- Contact history (calls, text messages, emails, chats)
Customers may fill out a form to provide this information, but ultimately it’s on the CRM platform to categorize the data.
Each type of input provides valuable information about customers that your company can use to assess your overall relationship with them, identify specific factors influencing purchase decisions, and consider actions to improve interactions with customers.
However, CRM platforms only consider half of the equation your business has control over and don’t include actions taken by your customers. Only considering CRMs leaves omits factors that contribute to the bigger picture of the overall relationship between your business and your customers, and combining your CRMs with CEMs can give you a much more complete understanding of both sides of this relationship.
Customer Experience Management is Based on the Customer’s Input
CEM platforms tackle the management aspect of crafting and delivering experiences, aiming to build stronger customer loyalty and retention.
Consider your customers’ opinions of your brand and its products or services when it comes to understanding relationships, what customers like about their experiences, and what they’d like to see improved. With a customer experience management platform, you have CX metrics and insights in front of you to act on.
While this information is valuable to your business, it is primarily based on information that the customer provides and actions they take — whether through direct or indirect customer feedback signals.
What’s the Difference Between CRM & CEM?
CRM and CEM are both used to analyze the relationship between your brand and its customers to make business decisions based on the data-rich information and insights uncovered.
Customer relationship management (CRM)
Customer relationship management focuses on actions your business takes to benefit your customers.
Customer experience management (CEM)
Customer experience management focuses on identifying and interpreting the ways in which your customers interact with your business.
5 Ways CRM & CEM Work Together
CEM and CRM are both important types of platforms when it comes to serving customers effectively, and they provide the best results when both are considered as part of the customer experience strategy.
Here’s how customer relationship management and customer experience management work together.
1. Voice of the customer
Gathering customer feedback about what they think of your products or services, customer service, and other areas is one of the most important steps any business can take to discover what customers like and dislike.
Your business’ assumptions about what customers think about your brand only go so far, and actively asking your customers for their thoughts is effective in ensuring you meet their needs and expectations.
Combined, a CRM platform and a CEM platform paint the picture of who experienced what and why they’re feeling a certain way about a brand.
2. Customer satisfaction
Integrating data between CRM and CEM is crucial for assessing customer satisfaction (CSAT).
You want to know if customers or happy or not, right? But you also need to know why they’re feeling happy or unhappy. It could be a widespread issue causing friction for all or many customers, or the issue might be limited on an individual basis. Analyzing CX with a CEM platform provides a comprehensive picture of CSAT levels both broadly and individually.
Establishing benchmarks and observing how changes affect customer satisfaction can track improvements and detect early issues. Consistent metric checks provide useful insights for continuous informed decision-making, helping you align business strategies with customer expectations.
3. Two-way communication with customers
CRM and CEM are vital as they promote two-way communication between you and your customers. This aids in refining customer interactions, comprehending their expectations, delivering quality service, and making informed decisions. It also enables early problem detection and post-purchase follow-ups, enhancing overall customer experience.
4. Customer pain point insights
Understanding your customers’ likes is rewarding, but it’s equally crucial to identify their dislikes and challenges when interacting with your business. This knowledge allows you to refine your products, services, and delivery methods to better address customer pain points and enhance their overall experience. This could involve addressing the specific problems that initially drew them to your products or services, or resolving issues that arise during their usage.
While contemplating customer discontent might be uncomfortable, these insights reveal opportunities for your company to outperform competitors in problem resolution. Demonstrating your commitment to easing customer challenges at each stage of their journey is pivotal. With CEM metrics, you can gain in-depth knowledge about both isolated and recurring issues. This data enables your business to identify and remodel the most impactful areas, thereby improving your customers’ overall experience.
5. At-risk customer identification
Not all customers who buy from your brand are repeat purchasers, nor are they necessarily satisfied with your services. They might choose your business out of convenience, affordability, or lack of effort to seek alternatives, but they could switch to competitors who better cater to their needs.
Therefore, identifying customers who are begrudgingly loyal to your brand due to a lack of better options can help improve your services and their impressions of your company. Customers who feel obliged to stay are not the same as those who genuinely prefer your products and services.
While such customers contribute to consistent revenue, it’s important to strive to meet their needs better, showing that you value their experiences and opinions beyond the profits they generate. CEM metrics are crucial in identifying these unsatisfied yet loyal customers and improving their experiences.
Unlock the Full Potential of CRM & CEM in One Platform
CRM data should be used to enhance CEM, and positive customer experiences (as sought in customer experience management) boosts the effectiveness of CRM activities. Therefore, an effective business strategy should integrate both CRM and CEM for maximum customer satisfaction and loyalty.
Medallia offers a platform for customer experience management that drives loyalty at every point along the customer journey. It allows you to capture and analyze signals, predict behavior, and create experiences that keep customers wanting more.
Schedule a demo with a Medallia expert — we’ll discuss what our customer experience management platform can do with your CRM platform to unlock actionable insights and deliver personalized experiences to customers.
