Customer relationship management (CRM) is not a new business term but the one that’s been around since the early 1970s. It has found its way into retail, hospitality, dealerships and many other industries where sales matter.
First replacing the traditional Rolodex with electronic databases and spreadsheets, CRM has evolved into a powerful software category on its own. Now at a 16% yearly growth, it was touted to become the fastest growing software market in 2018.
The following article will look at what makes CRM software so helpful for businesses in their pursuit of better sales, higher customer loyalty, and more employee productivity. We’ll also touch upon the diversity of CRM solutions on the market and their adoption drivers.
The Many Shapes of CRM
Despite the word ‘customer’ in it, CRM covers every stage of the sales funnel – from a prospect’s first brand encounter to a loyal customer’s repeat purchase. It’s important to understand this, as CRM systems are designed to serve both before, during and after a sale. This is a place where marketing, sales, and customer service converges, creating a holistic customer-centric ecosystem.
CRM software vendors recognize it, offering many-sided platforms that target each of these business functions. For example, the #1 CRM vendor on the market, Salesforce offers a whole line-up of solutions targeted at different organizational roles. There are sub-platforms for sales, marketing, service and commerce. As pointed out by independent Salesforce consultant Itransition, these can be used for end-to-end business process automation that goes beyond sheer customer database management.
These broad automation opportunities are reinforced in Microsoft’s offering as well. Recently rebranded as Dynamics 365, their CRM platform encompasses cloud-based apps for marketing, sales, and customer service, as well as for field service, HR management, finance and operations.
This CRM evolution coincides with businesses’ growing understanding of how important it is to deliver impeccable service faster and more efficiently. With this in mind, let’s look at how CRM can help to achieve this and many more goals.
6 Key Capabilities of CRM
Regardless of the CRM type – on-premises or web-based, custom or adopted from a ready-made product, its core functions remain the same. The following are six of its key capabilities that put CRM software in such a high demand.
1. Contact Management
A CRM system is a complete database of your leads, opportunities, and customers. The system will keep track of every interaction with them, be it a newsletter sent automatically, or a call from your sales rep. This allows keeping all the communication history in one place instead of scattered spreadsheets. Some CRM systems can even suggest the best time and means of communication for contacting a certain person.
2. Lead Management
A CRM allows viewing all the information about each of your leads in a single system. This includes not only their contact details and demographics but also the history of their interaction with your organization, including the lead’s source and their intent.
With a CRM system, it becomes easier to act on leads by sending them a message or giving a call right in the same dashboard. This function is also extremely helpful for long-term and consistent lead nurturing, when your goal is to gradually build up the lead’s trust to the point of conversion.
3. Marketing Campaigns
CRM systems serve as unique customer information sources that are fundamental in creating effective marketing campaigns. At the basic level, CRM can help to design a targeted email by supplying a lead’s relevant details and tracking their news on LinkedIn, for example. In more advanced cases, CRMs are used for automated creation of personalized messages, which can then be displayed as dynamic website content.
4. Deal Management
A CRM system allows managing all your deals in one application. There, you can see the entire history of deals per sales rep and keep track of the deals in progress. Typically, this can be visualized as a sales pipeline to provide you with a bigger picture. When alerted to longer-than-usual sales cycles, sales managers can thus intervene and take positive actions to amend this.
5. Reports and Analytics
Apart from the features described above, CRM is a powerful analytical tool. Sometimes, business intelligence comes as a core module – a good example here is Microsoft Power BI, part of the Dynamics 365 suite. In other cases, analytical capabilities can be integrated and fine-tuned to provide actionable insights on sales performance, missed and achieved targets, communication gaps and opportunities, and many more business-critical metrics.
6. Routine Task Automation
One of the frequently overlooked functions of CRM is sales automation. While the more intelligent tasks are always reserved for human reps, some routine can still be automated to boost productivity. Such routine tasks include changing a deal status or sending a reminder email. Based on pre-configured business rules, they can save a lot of billable hours.
The Key Drivers of CRM Adoption
CRM wouldn’t be so popular if it wasn’t for the benefits brought about by CRM capabilities.
In their recent research, Workbooks surveyed small and mid-sized companies in the UK to reveal their state of CRM adoption, as well as the reasons behind it.
Let’s review the key four adoption drivers that show CRM software at its best.
1. Customer Experience Management at Your Fingertips
Scattered across dozens of channels, customer experience is elusive. Brands are struggling to make a long-lasting, positive and consistent impression on their customers, and this is where CRM is called for help:
- You can personalize your interactions with a particular customer based on the insights you get from a CRM system.
- You can contact the person exactly when and how it is the most convenient for them.
- With these insights into customers’ needs and behavior, you can adjust your customer service and even the product to satisfy those needs in a better way.
2. Higher Employee Productivity
As a CRM system automates routine tasks, your employees can focus on what is truly important. Therefore, they get to do more in less time (for instance, talk to more potential customers) – and bring you more profit as a result.
3. Increased Revenue
With CRM, you can start caring better for both your potential and existing customers. Nurturing your leads and growing your existing customers’ loyalty, you can stimulate their positive purchasing decisions and thus increase your turnover. Upselling and cross-selling are also bound to become more efficient as you start offering the most suitable products to the right people.
4. Improved Communication
When sales, marketing, field and customer service teams come to cooperate within a single customer-centric system, communication is set to improve. When all of your employees engaged in customer interaction are on the same page and have a single point of truth, there is a lot less room for misunderstandings and mistakes.
It’s barely possible to squeeze all the CRM essentials into one guide, yet the overview above should have you prepared for deciding if you need a CRM solution on your own.
To wrap it up, some takeaways:
- A CRM system helps you manage the way you interact with both your potential and existing customers.
- It allows managing contacts, leads, marketing campaigns and deals, provides reports and analytics, and automates routine tasks.
- Implementing it makes your customer experience more satisfying, your employees – more productive, your revenue – bigger, and the internal communication – better.