Managing relationships is key to driving up sales figures, and modern computer systems can store vast amounts of data, enabling better relationship management. Both PRM and CRM systems manage the sales flow and can seem quite similar. But as any CRM consultant will be quick to point out, the systems are different in nature, and each is better suited to different types of business environment.
Customer Relationship Management
A CRM system manages direct sales. The customers are the end-users of your product or service, the ones that will give you feedback by repeated custom – or by giving you the cold shoulder!
The beauty of a CRM system is that it can direct the selling process to allow busy sales teams more time to focus on the human side of selling while it takes over the scheduling and administrative side of the job. CRM systems prompt sales teams to enter information about how the relationship with each customer is progressing which gives them a full picture of the best way to approach a sale over time.
Partner Relationship Management
On the other hand, PRM is designed to deal with your relationship with partners – where your end-user isn’t buying directly from you but is buying from a franchisee, a dealer or a distributor. They allow you to align your business processes, workflows and goals with those of your partners so that together you can create more sales. Unlike a CRM your PRM system needs to work both ways as your partners will need to be able to feedback how their interactions with the end-user are going so that you can adapt sales promotions or modify the product, for example, in response.
PRM systems encourage healthy communication between you (the manufacturer) and your partners, allowing you to build trust and allow you both to work towards the common goal of increasing sales of your product.
So which do I need?
Selling your product (or service) is what your business is about, and so CRM is ideal for managing your direct customers. It allows you to build up a picture of who your customers are, and to directly influence them. Businesses that only make direct sales to their end-users may find that a CRM is the only data management system they require for their sales team.
However, most companies use a mixture of direct sales and relationships with resellers. Equally, you may be the reseller and be feeding into the PRM of the companies whose products you are selling. So most companies will also find that a PRM system becomes useful as they grow, and their network of partners becomes more complicated. PRM allows you and your partners to work towards increasing sales, through collaboration and shared business aims.
You still haven’t answered the question!
A company in the early stages that sells mostly to their customers directly will have vastly different data management and sales flow management needs to a company that is well-established and has built a complex ecosystem of franchises, resellers, channel partners, dealers and distributors. Such companies may have almost zero direct-to-end-user sales.
Which system you should be focussing on, therefore, depends entirely on which type of selling model you are pursuing. If you aren’t sure whether CRM or PRM is going to be a worthwhile investment, then your first investment should be taking the time to talk to a CRM consultant who can assess your sales function and advise on the best systems to implement.