Manufacturers and distributors understand the importance of an enterprise resource planning system (ERP) in running an optimized business. But what many don't know is that these data-rich systems also provide information that can easily be turned into insights that improve marketing and sales processes. In this post we'll outline seven ERP capabilities that enable better marketing and sales processes.
1. Identify Customer Communication Preferences
An ERP system is a great way to identify the preferred method of communication for those you’re supplying. Does the customer always use technology to place orders or do they prefer a more traditional form of communication? Do they prefer hands-on or hands-off communication? Take a look at your ERP system to determine the touch points you have with specific customers to help you identify their primary method of communication, and determine whether or not it's efficient for each.
2. Get a High-level Overview of the Customer
There’s plenty of data to track in the attempt to better understand specific customers, but an ERP system allows you to get a high-level overview of data on purchasing patterns, typical items purchased, methods for ordering items, etc. As data accumulates over time, you can use this ERP data to estimate when an order is likely to be placed, the type and amount of materials the customer needs, and set up automated communication based on these patterns (e.g., reminder emails to the customer on when an item is due to be ordered).
3. Segment Customers
This is one of the most obvious advantages of an ERP system, as you can place customers into different lists or “segments” based on characteristics like products purchased, payment history (e.g., whether or not they pay on time), reasons customers prefer specific products, etc. This context also makes it easier to proritize certain customers over others based on activity and value of items purchased, allowing you to get a sense of the most profitable customers.
4. Personalize Content
Personalization is an extension of segmentation in an ERP system, as it not only uses the context provided by each customer to tailor products and services, but leaves the customer feeling valued. One example of personalization would be an automated follow-up email for an order placement. The email could include a greeting with the individual’s name, thanking them for the order and providing a timeline for shipment and arrival. This is fairly custom today for retailers, but the process should be just as seamless between manufacturers, distributors and their customers.
5. Create More Informed Reports
An integrated ERP and CRM software makes it possible to create more data-driven reports that provide insight on current order management, shipping, and inventory, to name just a few. You can use this information to track fluctuations in these three areas and identify possible explanations, and inform yourself of the most important metrics to track moving forward to help you meet customer demands.
6. Assess Profitability
To make sure you’re getting the most out of your ERP system, you’ll want to use it to assess profitability for certain items. Which products are making you the most money? Which customers are buying them? Why do they prefer this specific product over an alternative? These answers should all be apparent through your ERP system, and will help you develop a deeper understanding of customers and your own company’s profit margin.
7. Enable Projections
You want to match supply and demand, and there’s no better way than through accurate forecasting. This starts with getting an expected demand from a customer and using your ERP to scale this over time. Do you expect an increase or decrease in sales of a specific product due to seasonality or other factors? Your ERP can alert you if supply is too high or too low, so you can make accurate projections moving forward.
Take One Step Back to Take Two Steps Forward
Using an ERP system for customer insights involves an analytical approach, but one that will pay off in the long run. The key is using the system to better understand your distribution company and customer behavior, and using these insights to continually improve internal processes.