The Simple Guide to CRM Taxonomy

Taxonomy often comes last in CRM implementations. Sometimes, it’s skipped altogether. This creates problems that only grow increasingly costlier to resolve over time.

For example, segmentation becomes problematic because customer profile fields have inconsistent or missing data. This causes issues down the line as segment rules stop working and audiences become too small or too big to be sized right.

Like a line of dominoes, marketing campaigns start to underperform as they exclude the right customers and include the wrong ones. Marketing automations break, confusing customers and frustrating support teams.

And then, only then, taxonomy shows up on the leadership team’s radar. From something simple that could have been addressed early on, it balloons into a multimillion-dollar project with a big consulting firm.

The consultants come up with a 100-page slide deck and a 1,000-row spreadsheet. However, their recommendations are so detached from the in-the-field reality that they end up making the problem worse.

Eventually, CRM experts like us get called in and are asked to help clean up the mess once and for all. And that’s what we do. Still, there is a better way—and that better way is to think about taxonomy as early as organizationally possible.

What is a CRM taxonomy?

In its simplest, most functional form, a CRM taxonomy is a set of rules for the data that goes into profile fields and the names of segments, tags, and marketing automations that allows your organization to operate its CRM at scale and with success.

Another way to think about your CRM taxonomy is as an agreement between the individuals who supply the CRM with data and those who use that data in the CRM. The agreement is about both the contents of the data as well as the naming patterns for the rules that process the data every day.

One customer’s CRM implementation had grown so complicated with time that even the simplest of activities such as creating a segment required multiple back-and-forths between several different teams.

Worse still, measuring the results of their CRM campaigns had become almost impossible due to the lack of protocols and documentation about customer profile fields and customer segment names. When we looked into the CRM, we found seventeen different ways to name the previous year's Christmas campaign.

We started by partnering with a number of individuals and teams within the organization to create a taxonomy for campaign names. We then worked backward to apply the new names to existing campaigns and created a browser-based tool for the CRM’s operators to use for campaign names in the future.

Example of a CRM taxonomy

If you read this far, you understand the role and importance of taxonomy in a CRM implementation.

But what does a CRM taxonomy actually look like?

Let’s suppose you have a CRM system with customer profiles that have the following fields:

The First Name and Last Name fields are optional, and the Email Address and Phone Number fields are required.

The formatting of phone numbers is a pain point I see over and over again across CRM projects. On the surface, it looks like a trivial problem and minor detail. But if your SMS campaigns and automations rely on phone numbers following an explicit format, things can quickly grow out of hand.

Consider these questions:

• Should phone numbers start with a plus symbol ("+") or not?
• Should the area codes in phone numbers be set off by brackets?
• Should phone numbers contain spaces or hyphens?

In this example, a good starting point for a CRM taxonomy would be to set requirements for the phone number field that answer these questions.

Typically, the challenge with phone number fields is to make the rules work with multiple data sources feeding records into the CRM, and those records being of customers from multiple regions and countries (where different phone formatting principles apply).

The rest comes down to implementation, which involves agreeing on the taxonomy with upstream teams that feed data to the CRM, and implementing validation rules and reports to ensure the integrity and allow the monitoring of that data’s quality.

Now expand the scope of the taxonomy to every field that needs taxonomizing—addresses, consents, engagements, interests, purchases, etc.—and you have yourself a CRM taxonomy project.

A good CRM taxonomy also covers the naming convention of internal configurations and labels such as marketing campaign names, marketing automation names, and tags names.

The taxonomy should not just set rules, but also clarify operational details, such as when to use tags and when to update fields in customers’ profiles. The result is a CRM that’s easy to operate, even at the scale of multiple geographies and many campaigns year over year, with customer profiles that are simple to segment and activate across channels and touch points.

How to approach your CRM’s taxonomy

As always, begin by creating awareness of the need for a taxonomy for your CRM among the sponsors and stakeholders.

Once there’s alignment about the value of having a taxonomy and a desire to move forward with its implementation, conduct a review of your CRM as it stands today, identifying gaps and opportunities for improvement.

Next, agree on what the taxonomy should cover and where it will exist. Some organizations will have mature processes and taxonomy management systems. In others, a first version of the taxonomy can be as simple as an access-controlled spreadsheet or a table instance in Airtable.

With organizational alignment and clarity about the scope in place, create the taxonomy. Establish a governance process to manage change and train the CRM operators who will be using the taxonomy in their daily work.

Taxonomy is the type of work that impacts third-party dependencies as well. Any new rules or changes to existing rules may require changes to upstream integrations that feed data to the CRM or downstream ones that consume it—evaluate the impact and plan accordingly.

And if you need support, don’t hesitate to reach out. We’re here to help you get CRM taxonomy right.