Use CRM as your Product Innovation System


  • Innovating new products or services is not born from wacky ideas or curious explorations. It is achieved by solving customer problems with innovate solutions. Customer Relationship Management software can be the primary tool to acquire, tabulate and rank customer problems.
  • Successful innovation stems from buyer insights and customer intelligence. In fact, without this customer understanding your ideas, proposed solutions and prototypes are little more than wishful thinking. The CRM application is the system of record for buyer insights and customer intelligence. This is why it can double as your product innovation system.
  • Everyone knows creating novel solutions comes with risk. Fewer seem to mitigate that risk with systemic learning. CRM technology can capture valuable learning to improve institutional knowledge and apply lessons throughout ideation and prototyping cycles.
Johnny Grow Revenue Growth Consulting

Transforming Customer Data into Improved Products and Services

Research performed for the CRM Benchmark Report sought to discover if and how Customer Relationship Management software is used to improve company products and services or achieve other similar pursuits. And to know whether those pursuits were worthwhile, we also wanted to measure the benefits.

The data surfaced the three important findings.


An Ideal Innovation System

Creating innovative products or services is not prescriptive but follows known patterns that can be repeated. It benefits from a framework that applies technology to replicate processes and best practices.

Using CRM software as an innovation management system is an option to leverage existing technology and create synergies. Alternatively, this application can be used for pieces of the innovative process.

Our initial survey question was designed to understand how frequently CRM technology is used to improve the company's products or services.

CRM for Innovation

Respondents using this application to improve products and services were fewer than we expected. We were surprised that among all respondents, only 21 percent advised they use this application for this purpose.

However, when filtering that cohort by performance archetype, we were less surprised to see that an overwhelming majority were Best-in-Class leaders. In fact, the Best-in-Class leaders were 3X more likely to use CRM as an innovation system to improve their products and services than their lower performing peers. This disproportional result should not be lost on readers seeking ways to create breakthrough solutions or improve their their products or services.


The Source for Customer Data

Inexperienced innovators often believe they need to think up the next big idea. That's not the case.

The shortest path to success is to solve the most vexing customer problems. And customers will tell you their biggest problems if you know how to ask. We're in the age of the social customer. Customers will tell you what they want. They will share their top problems. But you must ask them.

CRM systems have the tools to engage customers and surface their biggest problems. They can also work with third party tools to feed the ideation engine with data. But which tools work best? The answer is shown below.

Customer Data for Product Innovation

Each of the above data acquisition methods surface the most pressing customer challenges or problems. When managed in the Customer Relationship Management system, customer problems and related data can be modeled by buyer persona, customer segment or target audience for more precise analysis or forecasting market potential.

Once the biggest problems are identified, the process becomes more co-creation with customers than experimentation for them. Your customers and their advocates will provide you real-time guidance to adjust and steer your innovative process toward products and services that will be enthusiastically embraced.

Companies can use CRM apps to capture customer insights and collaborate with customers during product design, manufacturing, distribution, sales, service and returns to create more valuable products and services.


The Top Benefits

Sometimes the process is designed to disrupt markets and achieve first to market advantage. More often, it's about benefits that drive shorter-term opportunities that still achieve business growth objectives.

We asked the participants to rate the top benefits. The results are shown below.

CRM Innovation Benefits

See the research findings that show the top benefits of using CRM as a product innovation system.

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The data revealed that the top benefits of using CRM for innovation were short to mid-term paybacks. And all directly contributed to the strategic goals of acquiring more customers, growing customer share and increasing customer retention.

An interesting thing about the data was that when we filtered it by performance archetype the ratings and rankings didn't change much. The CRM innovation system benefits were relatively consistent.


Innovation is a risk-reward business growth equation. When successful, innovative products or services create differentiation, higher margins, revenue growth and customer loyalty. It's not easy, but it's also not optional for companies seeking differentiation, higher margins, revenue growth and customer loyalty.

Most business leaders understand that risk and reward are opposing forces but are reticent to acknowledge that growth and comfort do not coexist.

Fortunately, the research shows how CRM software can help and directly aid product innovation. The data highlights methods to acquire the data that drives successful innovative processes while mitigating risk. It also points to clear benefits that deliver significant and sustained revenue growth.