Running a successful online business is the desire of every single person in the world. I mean, when you look at different instances across various industries – Amazon, Facebook, Monday, Apple – it’s no surprise. However, building, but more importantly, maintaining such a business is easier said than done.

Having an insane business idea, a time-proven business model, and even enough funding to cover marketing expenses isn’t going to be enough to get the job done. Surely, it may be a good boost, but at the end of the day, every business is extremely reliant on its customer base. Without loyal, returning customers that carry your brand on their shoulders, it’s hard to achieve long-term success. This is exactly why building and maintaining profoundly healthy customer relationships is essential to the success of each and every business in the world, across every single industry.

As Einstein once said – everything genius is simple. If your customers aren’t feeling appreciated, or you can’t tend to their needs on a personalized level for an extensive period of time, they will simply turn to a competitor, even if that, objectively, isn’t a good choice. In most of these cases, the saddest of truths is to realize that your competitor didn’t really win those customers over – rather, you lost them. This is where the CRM model comes in.

Understanding the CRM Model

Every modern business, including you the reader, is most probably using a CRM model. It may not be the best model, and it may not be a fitting model, but if you have at least a simple outline of how to approach and interact with your customers, you’re using a CRM model. Let’s dive into some details.

CRM stands for customer relationship management. It’s a set of skills, tools, and techniques designed to create and maintain healthy business relationships with customers, extend their lifetime value, and keep them interested in your brand for as long as possible.

A CRM model is a framework that helps your business manage these relationships, all the way from acquisition to retention. It’s important to understand that a CRM tool and a CRM model are two very different things that co-exist in your business strategy. A CRM tool is software designed to help you aggregate, monitor, and manipulate customer-related data. Essentially, your CRM tool helps support the CRM model.

The CRM model outlines all the steps that you’ll be taking to bring the prospects on board, build trust, and continue generating value for them as time goes by. Implementing such a model correctly carries three benefits to your business, which all directly transpose into revenue:

  • Building healthy customer relationships with prospects from the earliest stage and increasing their lifetime value.
  • Personalizing the customer experience and offerings based on data.
  • Serving your clients in a manner that can help “migrate” leads and existing customers from competitors.

The Top 3 CRM Models

A number of different CRM models have been created over the past 20 years, but all of them pursue the same goal – learn to understand the needs of your customers on a personalized level and use this information to provide an outstanding experience throughout the whole customer lifecycle.

I will share the top three CRM models that look to accomplish the above-mentioned goal via slightly different strategies.

  1. IDIC CRM model
  2. Buttle’s CRM Value Chain model
  3. Payne & Frow’s Five-Step Process model

Below is a brief explanation of each model.

1. IDIC CRM Model

Primarily a B2B framework, the IDIC CRM model has been developed by Peppers and Rogers back in 2004. IDIC is a well-balanced framework that treats all customers equally. It is designed to discover the needs and values of your prospects at the earliest stage and use this information as the foundation for all future customer interactions. IDIC has four actions steps:

  1. Identification – Understand what each customer struggles with and what their values are. Divide them into segments.
  2. Differentiation – Sort customers by value to your business (current and future) and their unique needs.
  3. Unique Interactions – Show them that you really understand their needs, and how exactly your product/service can solve them.
  4. Customization – Create unique, personalized offers based on all the information that you have.

2. Buttle’s CRM Value Chain Model

BVC is highly focused on customer lifetime value and retention, and the Pareto principle (80% of your profits are generated by 20% of your customers). It’s primarily a B2C CRM model, but some B2B businesses may find it attractive as well. With BVC, your goal is to go out of your way to keep that 20% happier than Santa Claus ever came remotely close to doing on Christmas.

80% of your profits are generated by 20% of your customers

The Value Chain is a five-step process:

  1. Customer Portfolio Analysis – CPA allows you to identify the most valuable customers (the 20%). Depending on your industry, the factors will vary – average buying rate, item category, time spent on your website, etc.
  2. Customer Intimacy – Understanding the needs and values of that 20%.
  3. Network Development – Bringing together sales, marketing, and customer support to tend to the needs of the top 20% in the best way possible.
  4. Value Proposition Development – Using a combination of your Network, customer needs, and your product/service, draft the most comprehensive value proposition. This includes unique discounts, consultations, and doing everything to show exclusivity.
  5. Managing the Relationship – When everything is set up, make sure to maintain all the interactions and offers at a steady pace.

BVC doesn’t state that you should ignore the other 80% of your customers. It only implies the importance of taking extra steps for the top 20%. This ensures that your highest profit generators will continue to do so, which will eventually increase your revenue based on customer retention longevity.

3. Payne & Frow’s Five-step Process Model

87% of customers think businesses need to put more effort into providing a seamless customer experience to clients.

Somewhat similar to BVC and suitable for both B2B and B2C businesses, Payne and Frow’s CRM model is focused on quality and consistency across the whole service spectrum. According to research, 87% of customers think businesses need to put more effort into providing a seamless customer experience to clients. This is why it’s important to ensure that customers will stay satisfied after successfully passing the onboarding stage.

The model consists of five steps:

  1. Strategy Development – Strategy development is split into two phases: business and customer relationships. Business strategy determines your vision and positioning among competitors. Customer relationships outline the characteristics of customer interactions.
  2. Value Creation – This process takes into account the value you bring to your customers and the value that customers bring to your business. The goal is to create a value proposition that will be suitable for both sides.
  3. Multichannel Integration – The most important step. This process brings together all your departments responsible for customer interactions and aims to deliver a seamless, consistent customer experience across all stages of the customer’s lifecycle.
  4. Performance Assessment – Analyze your efforts. Are customers happy? Is revenue going up? Is everyone across all departments on the same page?
  5. Information Management – This process is designed to support the other processes with the help of analytical tools, and front-office and back-office applications.

CRM Tools Support the CRM Model

Meeting customer expectations is good. However, if you really want to pump profits, you need to exceed those expectations, and that’s what CRM software like PipeDrive and Freshsales is designed to do.

To provide real value, you need information. Lots of information. Also, you need to make sure that the information is accessible to all departments, segmented into customer concerns and demographics, and reflects their needs. Finally, your team requires the ability to take notes easily, set reminders and notifications, and instantly get updated on past customer interactions before making a new one.

CRM software is the perfect tool that allows you to accomplish all of the above, and further enhance your efforts with reports, analytics, automation, and many other game-changing features.


The key takeaway is to care for your customers. Seems like an easy task, but facts show that most businesses struggle with it. You need to consistently show that your brand knows what customers need, how their needs evolve, and what type of solutions are best for their individual cases. Go out of your way to show that you care, and you will be rewarded. Big time.