From Ebay to the smallest home-operated start-up, e-businesses of all sizes struggle to accurately answer a common question: who are my customers? If you cant answer that question, chances are youre also in the dark about the following questions. What customer demand trends can I expect in the future? How can I improve customer retention? What can I do to build long-term relationships of trust with customers? Knowing the answer to these questions can mean the difference between long-term growth and profitability and crashing and burning.

Enter eCRM

With the proliferation of e-business into just about every consumer market, customers are faced with more options than ever. As a result, they have naturally become increasingly demanding both of the products they purchase and customer service they receive. The idea is that, if company A doesnt meet my expectations, I can always go to companies B thru Z. By merely doing a Google search on your product or service you can quickly discover the number of competitors waiting for the chance to eat your lunch.

The importance of eCRM is highlighted when you think of the fact that e-business customer touch points are limited and usually virtual. Theres seldom any face-to-face contact because the company usually doesnt have a physical location, just a web domain.

Because of the relatively recent appearance of eCRM on the business scene, many people arent quite sure how to define it. In fact, the definition of eCRM varies almost as widely as the techniques companies use to manage it. For some people, eCRM may be as simple as pulling data off their order tracking system; they may believe keeping track of who bought what tells them the whole story. Other e-businesses with more experience may take a more complex view; metadata, datamining and drilldowns, and CTI can all be seen as vital eCRM tools used to paint a picture of the customer.

Unfortunately, because of the recent inundation of eCRM systems to the market, some e-business fall into a cant-see-the-forest-for-the-trees syndrome; management may get lost in the data and lose sight of their goals. The purpose of eCRM isnt to collect data in new and interesting ways, its to answer the questions above. Still, crossing the gap between software and results remains a feat few eCRM systems are able to accomplish.

The problem with many eCRM systems is that they either, 1) collect irrelevant or insufficient data, or 2) dont correctly interpret data. While the second point is largely what management gets paid for, we must remember that small and medium business is the largest market segment for eCRM. These businesses are usually run from home by individuals with little or no formal business education.

The good news for startup e-businesses is that many of the newer eCRM providers will handle the nitty-gritty aspects of your customer relationship management system for you, effectively freeing up more of your time for other important tasks.