Back in the good old days of paper and ink, a client database was nothing more than the big Rolodex on a businessman's desk. It held every name, phone number, address, and note about each contact that its owner would need to conduct business effectively.
Fast forward to 2010 and the age of the "2.0" everything. Most small business owners don't own a Rolodex, or even believe in their power. Quickbooks holds client info. That's just as good right? Microsoft Outlook keeps track of my contacts, what more do I need? Both very valid statements, now let me take the time to prove you wrong.
What's So Wrong with Quickbooks?
Short answer: nothing. Quickbooks is a great way to keep track of orders, invoicing, income and expenditures. It is accounting software for the everyman, and everywoman, in business for themselves. But its just that, accounting software. While it may keep track of basic contact information and orders, it is not set up to relate non-accounting information in a useful way. When you construct a client database, specifically for the purpose of housing client information, you have control over the way your information is displayed. Control is good. Example: You run a sign shop. You want to promote plastic yard signs as your monthly special with a direct mailing campaign and personal phone call to all clients who have purchased signs in the last year. Using Quickbooks, you can look up the orders of each business by their name only. With a client database, you can sort by date and type of purchase, then just print a list of names and contact info. The information is available to you electronically in both scenarios, but which uses less time?
Misplaced Expectations & Outlook
Outlook is awesome, but it can't do everything. Yes it makes managing contact information easy and because its a Microsoft product, things like mail merge are a breeze. But its functionality stops there. Outlook manages mail. Conversations. Not products. Not orders. Not your client relationships. A client database can hold more detailed information than an Outlook contact page--information that may come in handy. Example: You own an upscale full service beauty salon. You offer specials for holidays and clients' birthdays. One of the employees suggests a mother daughter manicure pedicure deal for the month of May, because of graduations. With a client database, you could gather and store information tailored to your marketing needs because it is constructed by you for your own use. In this situation, you could search your client list for Women >with daughters 17-18 and prepare a nice mailer explaining your offer. Alternatively, with Outlook as your contact manager, the best you could do is mail merge all the addresses on to address labels and direct mail everyone on your list.
The 5 Truths about Client Databases
The title of this post talks about a "support network." Your clients are your support network. They support your business. You should support them and a database will help you do that. Its all about After Care, a practice that isn't just for hospitals anymore.
- Not every database is a useful database. Databases that are poorly maintained, missing information, out of date and/or have too much or too little information, are all just a big waste of time.
- Planning and maintenance are a must. Before you start on your database adventure, sit down with a blank piece of paper and think. You need to decide (1) what the database will be used for and (2) who will use it. Plan out your fields of data and how you will collect them (i.e. will the clerk ask the customer, or will the customer be given a form, ect.). Create your database and set a schedule for updates, in addition to making changes as they occur. The scheduled review will allow you to identify problems or trends within your database, that you might not notice when popping in to make an address change.
- Databases can enhance relationships. Small businesses have the advantage of "face-to-face loyalty"--you see your customers regularly, you know their buying habits and may even be on a first name basis with them. You've built a relationship. Because of that relationship, any communication you have with them will not be seen as spam or unwanted solicitation (as long as you don't get crazy with it). So look them up once in a while and call them, or write them--handwritten letters are best--and say something like "Hey Sue, it's Margret over at the Tea Cup cafe. I wanted to send you some early birthday wishes and let you know about the great menu the restaurant will be having the weekend of your special day..."
- Databases can help you provide better service. A properly constructed database will give you the tools you need to understand your clients, their wants and needs. It can also help you identify habits so you can anticipate requests.
- One database may not be enough. Databases with too much information are useless because you can never find what you need. If you run a very detail oriented business or have thousands of clients, you may need several databases that cross-reference each other for enhanced functionality.
