CRM is one of the biggest strategies businesses use to improve their profitability and revenue, cut costs, and keep their customers coming back. That’s because it has one very simple philosophy – the customer always comes first.
When a business can see all its transactions through its customer’s eyes, it helps them provide a much better experience, resulting in more customer loyalty.
CRM software helps a business bring all the information it holds on its customers together in one place, allowing everyone with access to see everything they need to.
This means salespeople can make quick decisions, helping improve customer responsiveness and communication and ensuring marketing and sales campaigns are coordinated.
Implemented in the right way, CRM software allows companies great insight into how they can improve business with individual customers and helps them measure their value too.
Why CRM is So Important to Businesses
CRM has grown significantly more important to businesses because it helps them keep their customers and attract new ones. It’s fair to say that the industry is showing no signs of slowing.
According to a Gartner report, CRM software generates higher revenues than the previously popular database management systems. That makes it the biggest software market in the world.
We live in a competitive world, especially in terms of business, and the market is saturated with services and products. That has led to customer loyalty seemingly going out of the window and customers becoming incredibly picky.
As soon as a new product hits the market, it becomes a commodity within a few short months, making it easier for customers to switch between companies.
It’s also fair to say that not all customers are the same.
Some spend little but cause a huge drain on customer service resources, while others frequently buy new services and products. CRM helps businesses prioritize sales efforts in terms of which customers are likely to spend more and cause less commotion.
It also helps businesses understand their customers’ needs, allowing them to produce a more targeted product/services portfolio to offer each customer individually. The more info a business has about its customers, purchasing behavior, and preferences, the more its offers will be on target.
How CRM Works
Many people consider CRM to be nothing more than technology, but it is much more. It doesn’t matter how sophisticated it is; no technology can succeed if its implementation and use are not guided by sound strategy. Technology must work hand-in-hand with business strategy to ensure business plans are customer-centric. The following CRM roles illustrate the importance of the software to any business:
CRM systems allow businesses to create strategies that put their customers first. These strategies must comprise clear goals and a complete understanding of a meaningful customer experience.
Customer experience is integral to CRM; whenever a customer and business interact, regardless of channel, they can form their own opinion of the business. As time passes, this opinion forms the value and brand image.
Where an organization is serious about CRM, they ensure good customer experiences. They can see and understand that a bad customer experience can lead to customer churn – customers jumping ship for another. When a customer has a good experience, they are more likely to stay loyal.
While CRM and customer experience share some commonalities, there are some key differences:
|CX (customer experience) is how a customer perceives and feels after they deal with a service, product, or company||CRM is the process and software used in marketing, sales, and customer service interactions.|
CRM is about how the business reacts, while CX is about the customer’s feelings and perceptions of that interaction.
Customer Data is Centralized
CRM software combines marketing, sales, and customer service data into a centralized place, typically a database. This ensures that all employees have access to the same data, and when they gather new data on a customer, it is shared with everyone as soon as it is input.
Customer information usually involves personal details – name, address, phone number, email address – and contact between the business and the customer. The CRM system will also show what was discussed, agreements, follow-ups, the status of open items, and everything else required to ensure the business complies with GDPR.
The business then uses that information to manage, track, and measure sales, marketing, and customer service activities, resulting in better customer experiences and the more likely they will stay loyal to the business.
Because customer-facing information is centralized within a CRM system, everyone can access the same information. No department within the business can accuse another of not communicating, failing to implement campaigns, and creating bad feelings with customers.
Automated Business Processes
Businesses have two main processes – customer-facing and business-facing. The latter includes planning, budgeting, and other areas that ensure the efficient running of the business, while the former includes customer service, marketing, and sales.
When a business builds its CRM strategy, its primary focus should be on the customer-facing processes, ensuring they meet their customers’ needs.
So, how does it work?
- The process starts with a sales lead, nothing more than the name of someone who might want to buy what the business sells
- The business approaches the person – this is known as outbound sales, otherwise called cold-calling
- The potential customer completes a web form, providing their contact details and essentially giving the business permission to contact them
- That information is input into the CRM system, which then pushes the customer details to the sales process. The CRM will notify the sales team that a call needs to be made to the potential customer. Every time someone interacts with them, the details of the conversation are recorded in the system.
In short, the CRM system tracks everything related to the lead and keeps it all together in one central database.
However, CRM systems are more than that. They are also a library containing emails, phone calls, and documents relating to each customer or prospect.
When the initial contact is made with a lead, the CRM provides an instant trail of everything that happens, and because it is centralized, any person in the company can see it and deal with any queries that arise.
CRM systems automate some of the business processes while also automating how the processes interact with one another. But, the processes must be efficient and well-defined for the system to work efficiently.
Automating the Customer-Facing Process
This is one of the biggest reasons why CRM is so important to a business.
Before a lead can be turned into a customer, there is a process that must be gone through:
- Identify the lead
- Qualify the lead
- Convert the lead into a sale
Leads can come from virtually anywhere – cold calls, websites, events or seminars, social selling, or even purchased, so long as the list it is on conforms to GDPR rules.
With so many channels available, it must be crystal clear which department and/or person should be logging it into the system.
That determines the route the lead takes and how it must be followed up. If the process is not defined properly, leads get lost, leading to customer and business frustration, a lost sale, and the customer forms a poor vision of the business.
Clear rules should be in place for the management of customer support requests. These rules must define which line of support the request goes to, which resources will help solve the issue, and how updates should be shared to make sure the issue is correctly dealt with.
Once the rules and processes are defined, the CRM can automate everything.
It also records a history of every customer interaction, ensuring everyone can see what has happened and what needs to be done, thus ensuring a better customer experience.
GDPR has changed how businesses market their services or products and manage their subscriber databases; in short, it has become much more complex for them.
Every customer, prospect, and partner must be dealt with following a different process, depending on their relationship with the business. If a business tried to do all this manually, it would risk sending emails to the wrong people, especially those who have unsubscribed from the emails, which could lead to hefty fines.
The key is consent – every business must have consent from a person to communicate with them.
The subscription management lifecycle is automated with CRM, from when a person signs up to when they unsubscribe. This also includes their right to be forgotten, requiring the business to delete all the information held about them.
No longer do B2B buyers need to be told what they want or need; they already know because they’ve used the internet to search for it, be it on websites, blogs, forums, and more.
They want a company to treat them as a person as if their business were the sole reason for the company’s existence. They want to know that they are valued and that the business cares about them
CRM systems are critical to making this happen, ensuring customer satisfaction, increased sales, and more customer satisfaction. If a customer feels valued, they’ll return and spend money.