The dawn of the technological age has pushed forward an array of marketing techniques in the digital realm. Numerous technologies, such as PPC platforms, CMS systems, email marketing tools, and marketing automation, have made life easier for both markets and their audiences.
These marketing technologies allow consumers to easily search for and reach out to companies that can help with their concerns. On the other hand, marketers can use these technologies to reach wider audiences with optimized content with maximum efficiency.
One of the most significant tools most companies now deploy in their marketing efforts is Customer Relationship Management (CRM). But what is CRM, and how does it help organizations market themselves?
What is Customer Relationship Management (CRM)?
Customer relationship management, or CRM, is a series of strategies, practices, and technologies businesses use to maintain good customer relationships. In the most basic sense, CRM focuses on acquiring, managing, and nurturing customer relationships. This is done by collecting and analyzing related data, such as customer interactions throughout the customer life cycle.
In essence, the CRM process considers four major components to ensure efficient customer service and experience. The components of CRM include satisfaction, loyalty, profitability, and retention.
This component measures how a customer perceives the quality of your company, services, or products. You may think of this as how they feel about your offers and whether it solves their problem. Unsatisfied customers may look elsewhere to purchase their product if yours isn’t up to scratch.
The loyalty component concerns how often a customer purchases from your company versus others. Loyal customers are essential for businesses. They provide a consistent income stream and even help grow your customer base. You can check how many customers are loyal to your company by reviewing your repeat sales and referrals.
Profitability measures how much profit or loss a company generates. The generated profit is another essential component as it enables a business to continue its operations and provide its services or products. Companies constantly operating at a loss usually have problems sustaining their operations.
This component of CRM is closely intertwined with loyalty, measuring how many customers are loyal to a company. Retained customers don’t just provide steady income. After purchasing, they also cost fewer resources as you won’t have to spend as much on R&D and promotional campaigns.
What is a CRM Software or System?
In the most basic sense, CRM software is a system that can aid your processes in managing your customer relationships. This system streamlines sales, marketing efforts, management, accounting, and customer services by providing a central database. This way, your team can quickly analyze and keep track of interactions, data, and notes of your customers and prospects.
More importantly, you can gather deeper and more meaningful insights on how to best appeal to your customers. Some of the common features that CRM software offers include the following:
- customer database,
- workflow automation,
- third-party integrations, and
- sales forecasting.
You can also choose from three types of CRM: collaborative, operational, and analytical.
1. Collaborative CRM Software
Collaborative CRM software eliminates the obstacles of understanding your customers’ needs. With this system, customers won’t need to repeat themselves as they get passed on to the concerned department. Furthermore, your customer service team can easily pull up interaction records with that particular customer and quickly resolve their concerns.
2. Operational CRM Software
Operational CRM software can give your team the right tools to visualize and handle multiple customers in every stage of the customer journey. For example, this CRM type’s features can track customer behavior as it interacts with your website and as they go through your sales pipeline. On top of this, it automates repetitive tasks to give your sales, marketing, and service teams more time for other critical tasks.
The analytical CRM software’s strength lies in efficiently helping your team analyze customer data. It doesn’t just help with gathering the necessary information. It also helps your team develop valuable insights on attracting customers and keeping them satisfied. With these details, you can take the necessary steps to close sales and address common customer problems, resulting in a higher customer retention rate.
Benefits of CRM
Implementing CRM in your organization can benefit every team, including:
- Marketing – Your marketing team can keep track of every customer interaction in multiple touchpoints. They can use the collected data to increase customer engagement with optimized websites and personalized content.
- Sales – The sales team can use CRM to identify and address process bottlenecks. This way, they can assist customers in the sales journey and speed up the sales cycle.
- Customer Service – CRM can distribute client cases to available customer service representatives for a speedy response. Moreover, CRM improves customer experience by eliminating the need to repeat themselves when they talk to a new contact person.
- Operations – The appropriate CRM software can assist your operations team in identifying bottlenecks and inefficiencies across multiple departments. They can create better workflow templates to make each department’s processes more productive.
Integrating a proper CRM system can significantly improve your company’s overall efficiency in managing your customer relationships better, which leads to:
1. Knowing your customers better
A CRM system can aggregate customer data to provide a holistic view, which is especially helpful if you deal with hundreds or thousands of customers. With this, you can gain notable insights, such as your audience’s or customer’s demographic data. This information can help you develop the best content or marketing campaigns to attract customers and encourage engagement.
For example, you can use this information in your personalized email marketing campaigns to push for customer engagement.
2. Improved customer experience
Extended response waiting times can drive your customers to look at other options. You can prevent this using your CRM system, which provides customized response templates. For example, with a chatbot, you can immediately provide answers to your customers when they have a query about your product. Your reps can also personalize communication by checking interaction histories in your CRM’s database for a more comprehensive response.
3. Increased sales and retention
The right CRM system provides the right tools to satisfy your customers. In turn, your customers can become loyal to your company.
Again, loyal customers are essential to any business. On top of a consistent income stream, they can recommend you to their social circles. Word of mouth is a powerful tool that can encourage others to choose your company. Over time, these referrals can also become loyal customers, recommending you to their social circles. As a result, you can expect an increase in your sales.
Current Challenges Facing CRM
1. Poor adoption
Adopting CRM can help you in many ways. However, implementing CRM may do more harm than good if you don’t have an organized plan on how to do it.
Your team may be used to old processes and tools, giving CRM a steep learning curve. Learning the ins and outs of CRM takes time and effort, which may be challenging for your team. If your members don’t know how to navigate the CRM system, they may not use it properly. This circumstance can lead to delays in work and wasted resources.
2. Siloed departments
Your sales, marketing, and customer service departments must be aligned to provide a seamless customer experience. However, doing so may be difficult if your CRM system lacks the tools to permit collaboration between teams.
Customers may become frustrated due to the time it takes to resolve their concerns and the tedious customer service.
For example, one department may not have access to the previous one’s interaction history with the client. Due to this, your team may have to ask about the concern again. This circumstance can take time away from your team and cause bottlenecks in addressing other customer queries.
3. Poor data quality
Relevant users may forget to update the information in the CRM system. Moreover, organizing customer information may be difficult, especially with siloed databases paving the way for errors and double entries. As a result, the concerned departments may deal with outdated data and inaccurate insights that can compromise your efforts.
Marketing campaigns require timely, relevant, and clean data. Your marketing team’s goal is to reach the target audience and encourage them to engage with your marketing efforts. But, doing so may be challenging if the campaign’s content is irrelevant to the current buyer trends.
Getting Started with CRM
Step 1: Know your business goals and requirements.
You must know what you want to gain from your CRM to choose the right one for your business. Setting objectives—such as growing your sales or increasing conversions—and pain points you want to address is a good starting point.
Try reviewing your business performance and identifying the gaps that CRM can fill. Knowing what problems to solve and what goals to achieve will let you know the appropriate CRM for your organization.
Step 2: Ask for insights from your team and other departments.
Discussing your team’s and the other departments’ inputs can help in more ways than one. Including them in the decision-making process can help seamlessly implement CRM into the company’s workflow. You can help them understand how CRM can help in their operations.
Furthermore, their feedback may help you decide which tools they’ll need to perform their tasks or how to efficiently train employees on utilizing CRM.
Step 3: Take note of what CRM features you need.
While you can take a mental note of everyone’s needs, keeping a list of features you’re looking for in your CRM is still essential. Doing so will help you set a realistic budget and assist you in your search for a provider.
Ensure that your data security is a priority, especially since you hold sensitive customer information. Also, consider prioritizing customer support. The main focus of your CRM should be to help you maintain good customer relationships.
Step 4: Decide on the best CRM type for your business.
Again, CRM has three types: operational, analytical, and collaborative. You may have difficulty choosing between the three if you don’t know what you need.
As such, your business goals, requirements, and insights you get from the discussions with your team and other departments can help. These details can guide you and help avoid investing in a CRM system that your team may not use or bear favorable results.
Step 5: Look for the best providers that match your needs.
Don’t just go with the first provider you talk to. Instead, consult with others to get the best deal.
Aside from this, you may try researching each provider you meet with to better understand which option best suits your CRM needs. You can ask for referrals or check their reviews on trade sites.
Step 6: Create a plan for effective CRM implementation.
Once you have the right CRM and partnered up with the best provider for your business, it’s time to develop an organized plan for implementation. Some things you’ll need to address in this plan are updated processes to include CRM, training, and the like.
Level Up Your CRM with Spiralytics
Whether you’re a small company or a large enterprise, customers are a large part of why you have a business in the first place. They are the market your products and services cater to. More than that, they help expand your business, so maintaining good customer relationships is a must. And integrating CRM into your workflows is the best way to do so.
Implementing CRM helps deepen your understanding of your customers, allowing you to serve them better. Your team can improve the customer experience with the proper data and tools. As a result, you can increase satisfaction and loyalty, bringing high retention rates and a profitable business.
Partnering with a reliable CRM provider like Spiralytics can help improve your customer relationships and drive results. Contact our experts today to know more about our CRM and marketing automation services.
CRM Frequently Asked Questions
While both systems are integral to businesses, they cater to different functions and address specific needs. CRM focuses more on customer-facing functions. Sales, marketing, operations, and customer service are the departments that deploy CRM.
Meanwhile, enterprise resource planning (ERP) tackles the financial and logistics side of the business, assisting in the day-to-day operations. ERP systems typically include CRM functions. However, CRM systems don’t have ERP functions since they only handle customer interactions.
There is no one-size-fits-all price. Prices may vary from $50/month to over $10,000/month depending on the CRM solution you opt for. Other factors that can affect the cost are the following:
1. Type of CRM software
2. Features included
3. Number of users
4. Skills training on navigating the software
Like the price, developing and installing CRM software will depend on numerous factors. They may take a long time if you have a multitude of files to import, users to include, devices to install it in, and the complexity of configurations.
However, building a list of your requirements and features you want to see in your CRM software can reduce the development and installation time.
Many companies are becoming interested in CRM as they recognize the significance of customers for businesses. They are the main stakeholders that companies must satisfy, which is why they aim to understand their customers better. It also helps to know that the average ROI of CRM is $8.71 for every $1 spent.