There was a time when people would remember the contact details of friends and family. Today, you cannot move without the contacts app on your phone. Why waste time and effort to cram the numbers when an app can do that better? In fact, it’s not possible to remember all the details of emails and mailing addresses. This stands true for large companies, as well.
In the modern business world, most policies are customer-centric. Pleasing customers and having a good relationship is the main goal. A majority of the businesses thrive on great customer support and customer service. However, the larger the consumer base, the harder it is to manage the relationship with customers. This is where CRM – Customer Relationship Management software comes in.
What Is CRM?
You might have heard and read this acronym many times. Customer Relationship Management is the core of business operations. CRM is a tool that helps companies track their business relationships, manage the marketing and sales operations, and provide customer service.
At the core, CRM tools maintain customer databases and business contacts. However, thanks to the new tech, CRM provides support in marketing and sales processes. CRM software helps software experts to use the CRM tools for a variety of business activities.
Meaning of CRM
CRM is all about managing your business’ relationships and connections with existing and new customers. Moreover, CRM is a means to improve relationships, thereby helping companies to stay connected with their customers. With CRM, companies align their processes and enjoy a higher ROI.
The percent of companies that achieved their sales quotas using a mobile CRM and without using it. Source: ReadyCloud Suite.
For a better understanding of the term, let’s break it down.
C – Customer
No business can thrive without a loyal consumer base, customers are the building blocks for any business. In addition, the way a business manages its contacts plays a major role in its success. Customer-centric companies generate more revenue than other players in the market do.
R – Relationship
Perhaps, the term 'relationship’ is the most important in CRM and for any business to grow. Are you wondering why? If yes, then here is the answer. Your relationships with your customers define the future of your business. It is a link between your customer needs and your business offerings.
Unsurprisingly, improving the quality of relationships and customer retention is one of the main reasons why companies adopt a CRM system. CRM tools are focused on relationships and help to find and manage your contacts.
M – Management
If you want your relationship to work, you have to put in an effort. Show with your actions that you care and don’t take your partner for granted. Business relationships are no different. You should know everything about your customers, their needs, and your concerns.
CRM helps you in managing your relationships with hundreds of thousands of your customers. It gives you an insight into the customers’ expectations and their buying trends. It is not wrong to say that CRM is a mini social network that connects you with the people, including customers and business clients.
Purpose of a CRM System
First, CRM software helps companies bring together data from various departments and have a holistic view of each customer instantly. Without a doubt, CRM is the leading database management system in the software market today.
If you want your business to grow, you need strategies, sales targets, some objectives, and adequate profit margins. However, tracking your progress can be a bit tricky. Moreover, you need a way to turn the data from various channels into meaningful info.
A CRM system does that for you. CRM starts by gathering details about the customer through many sources. The channels include the customers’ website, telephone, email, and social media accounts.
CRM may also pull in information, such as the company’s current business activities and customers’ personal choices – their likes and dislikes. This helps companies build a strong relationship with customers over time. According to a prediction by Gartner, CRM is going to be the “single largest revenue area” in the enterprise software industry by 2021.
Types of CRM
Some businesses may look for a quick way to contact the clients, others may need to approach each client personally. Some businesses might only be looking for a better way to document interactions with a client. The basic idea for CRMs to exist is one, i.e., understanding the contacts/customers better and using the information for growth.
Marketing automation is forecasted to be the fastest to grow by 2022. Source: ScienceSoft
Let’s have a look at the three main types of CRM software that your business may need.
First, operational CRM software streamlines the main business processes, including sales, marketing, and service automation. At the same time, the primary goal of operational CRM is generating qualified leads and then converting leads into customers. That’s why operational CRM gathers relevant details and provides services. Also, operational CRM helps in providing services for a smooth customer experience.
In addition to that, operational CRM extends support to the communication department responsible for interacting with the customers. Also, the operational database includes all information about the customers, including communication records, needs, and preferences.
All the information about a customer is stored in the contact list. Any customer care agent within the organization with the access may retrieve the data. Operational CRM is widely popular due to its unified customer view across all communication channels.
To begin with, sales automation helps a company in many ways. Firstly, it helps set standards/targets within the organization for acquiring new customers and retaining existing ones. In addition, operational CRM organizes the data in a manner that makes it easier for companies to meet the customers’ needs.
As the name suggests, marketing automation improves a company’s marketing performance by making many of the processes automatic. The main aim is to find the best marketing methods to approach customers.
Campaign management is the main module. It helps businesses pick the best medium/channels to reach out the potential customers. Some of the popular communication channels include emails, telephonic conversations, face-to-face meetings, and advertising on social media.
Service automation helps companies retain customers through high-quality services. It helps build strong connections with the customer and earn their trust. Service automation focuses on
- Issue management to address customers’ problems,
- Customer call management for handling incoming and outgoing calls, and
- Service label management for monitoring the quality of the customer services based on the performance metrics.
Analytical CRM is designed to help the top management in sales and marketing. It supports personnel to find out the best ways to cater to the customers. Essentially, the main purpose of analytical CRM is data analysis.
The app monitors customer data that comes from different touchpoints for better know-how of the company’s status. Analytical CRM helps the top tier to make better decisions. The app helps marketing executives know how good or bad their campaigns are.
Also, it supports the sales executives in increasing the sales and customer care personnel to improve their service quality. So, analytical CRM helps to:
- Gather details about the customer, coming from various channels, and systematically analyze the data.
- Devise a unique way of sales and marketing
- Build strong connections with customers and earn their trust
- Gauge the performance metrics and use CRM to its fullest
In most companies, each business unit likes to work without sharing customer details with other sections. This approach often results in a loss for businesses. Collaborative CRM is an answer to this problem.
A business should have its departments on the same page. A collaborative CRM, also referred to as strategic CRM, helps the company hit this goal. Here, the CRM tool allows the company to share customers’ data across departments.
For instance, the feedback customer support gets can help the marketing team to come up with better ways of promoting the products and services. They can approach hot leads with exactly the products they need.
Hence, this CRM gathers all groups within a company with a common goal. The aim is to use the data for improving the CX. Not only does it help retain customers, but also bring in new ones.
Benefits of Customer Relationship Management
While the sales teams benefit the most from CRM, the software helps every unit of the business in some way. Besides increasing sales, CRM has emerged as a tool for improving customer experience. Let's have a look at a few of the many advantages CRM offers to your business.
A survey of 500+ companies about their expectations for the benefits of CRM systems. Source: SuperOffice.
CRM Gives a Customer’s Holistic View
With CRM software, you get a holistic view of the customer’s relationship with your brand. It gives you an overview of the customer’s past association, their shopping trends, the status of their orders, and their issues and concerns.
For instance, a customer may register a complaint at one channel, like Facebook, and then move to private chat for resolving the matter. CRM enables you to handle the issue across multiple channels without losing the track.
It will provide the sales, servicing, and marketing units a single view of the customer. Thus, the teams can make a well-informed decision and improve the quality of the service.
CRM Connects You to Business Apps
Strong customer relationships are crucial to a business’s success, satisfied customers are an asset for your organization. CRM helps you to build long-lasting relationships with customers. It connects you to business apps and business tools.
The landscape is dynamic, and you can integrate CRM with the best business tools in the market. For instance, with a CRM platform, you can integrate document signing, surveys, and accounting and billing. The integration allows the information to flow both ways, giving you a 360-degree view of your customer’s activity.
CRM Helps Generate Qualified Leads
CRM platform helps you identify qualified leads, i.e., the right customers for your product or service. Using the data from CRM, you can target the right customers and increase sales. You get a better insight, thus, you can focus on nurturing them and converting them into potential buyers.
The information that you store on the CRM software helps sales and marketing teams make better decisions. They can shift their efforts to the right people at the right time.
CRM Helps Retain Customers
Today, customers look for instant service and appreciate personalized support. With a CRM system, you can serve the needs of your customers in real-time. CRM gathers all the info in one place, which allows the agents to reach out to the customers on time.
The quick response helps know the signs of customer churn out at the early stage. The prompt action helps companies retain their loyal customers. Harvard Business Review reports that a 5% decrease in customer attrition, increases your profit anywhere between 25 and 85%.
Another study by Capterra found that 47% of CRM users find CRM an effective tool for customer retention.
CRM helps Acquire New Customers
A loyal consumer base helps your business to expand and thrive. When you know the customers better and cater to all their needs, you win them over. A happy customer increases your cross-selling and up-selling chances.
Today, more than 71% of buyers make their shopping decisions on social media referrals. Also, a whopping 88% of customers rely on online reviews for shopping.
In the past, CRM was used as a marketing and sales tool. Today, it is one of the best tools to improve your relationships with customers. CRM helps automate the sales operation and allows managers to track their team performance. Above all, it helps improve communication across the various departments within a company.