Customer data is defined as the information your customers provide while interacting with your business via your website, mobile applications, surveys, social media, marketing campaigns, and other online and offline avenues.
Customer data is a cornerstone to a successful business strategy. Data-driven organizations realize the importance of this and take action to ensure that they collect the necessary customer data points that would enable them to improve customer experience and fine-tune business strategy over time.
Basic personal customer data forms your organization’s fundamental understanding of each relationship.
Many—if not most—standard data fields in a CRM could be considered basic data.
A contact’s name, email address, phone number, job title, and linked organizations are examples of basic customer data.
Demographic data, such as gender and income, or firmographic data, such as annual revenue or industry, are also basic customer data.
When aggregated and analyzed across multiple contacts and/or organization records, basic data builds the basis for audience segmentation.
Then, by using tags or reports in your CRM, you can begin to visualize how many customers share common attributes.
Sometimes referred to as “engagement” data, “interaction” data includes customers' many touchpoints with your brand.
Interaction data is particularly useful for informing decisions that pertain to the buyer journey.
Pageviews, ebook downloads, social shares, email inquiries, and demo requests are common examples.
Interaction data is often anonymized and aggregated for high-level reporting purposes (with the ability to “drill down” for further insights).
For example, marketing consultants spend considerable time studying interaction data in web analytics platforms to understand campaign effectiveness and return on advertising spend (ROAS). In addition, some marketing platforms provide user-level reporting to track where each customer came from.
Five Main Types of Customers
In the retail industry, customers can be segmented into five main types:
Loyal customers are the most important segment to appease and should be top-of-mind for any company. This type of customer generally represents no more than 20% of a company’s customer base but contributes most sales revenue. Loyal customers, as the name implies, are loyal and value a product heavily.
In addition, loyal customers are likely to recommend the company’s products to other people. Therefore, it is important to solicit their input and feedback and involve them in a company’s decision-making process. Heavy emphasis should be placed on loyal customers if a company wants to grow.
Impulse customers are the best customers to upsell to and are the second most attractive segment (after loyal customers) to focus on—impulse customers who do not have a specific shopping list in mind and purchase products spontaneously.
In addition, impulse customers are typically receptive to recommendations on products.
Impulse customers are second to loyal customers in the generation of sales revenue. Therefore, keeping these customers in the loop on new product offerings goes a long way in improving a company’s profitability.
Discount customers play an important role in turning over a company’s inventory. Therefore, discount customers are a key contributor to a company’s cash flow.
This type of customer seldom purchases products at full price and shops around for the best markdowns.
Discount customers are resilient to upselling, are usually the least loyal segment of customers, and generally move on when better markdowns are available elsewhere.
A specific need drives need-based customers. In other words, they enter the store quickly, purchase what they need, and leave.
These customers buy for a specific need or occasion and are hard to upsell. It is important to note that need-based customers can be easily drawn to other businesses.
Therefore, it is important to initiate positive personal interaction with this customer segment in order to retain them.
Converting need-based customers to loyal customers is attainable with proper positive personal interactions.
Wandering customers draw the largest amount of traffic to the company while making up the smallest percentage of sales revenue.
They have no specific need or desire in mind and are attracted by the location of the business more than anything else. In addition, these customers enjoy the social interaction of the shopping experience.
Therefore, spending too much time appeasing this segment can draw away from the more profitable segments.
Although this segment generates the least sales revenue, providing insightful information about products to these customers can stimulate interest and ultimately result in a purchase.
The Type of Information in a Customer Relationship Management System
Customer relationship management, or CRM, uses a database to accumulate information about business prospects and customers, including product needs and purchasing history.
Various businesses integrate CRM data into their marketing and advertising efforts as well as sales strategies. In addition, businesses can customize the information they collect and store, so configurations are virtually limitless.
Anything relative to a customer is valuable in a CRM system, including personal customer information and demographic data. Notes and attachments can capture the details of a service call, customer support needs or warranty information.
In this way, the CRM data replaces a paper file to track each interaction with a customer. When attachments are included in a CRM system, valuable documents become easily available for review. For example, if a customer is in proposal or contract negotiations, each revision can accompany the customer record for quick review, markup and electronic sharing.
The CRM system can store vital data for your internal sales force, such as employee and commission information. Thus, CRM also becomes a useful tool for assigning tasks, checking progress, and monitoring internal sales goals and records. This feature allows the sales management team to monitor activity and allows individual sales representatives to compare their productivity against peers in real-time.
When used to manage prospects, the customer relationship management system is invaluable for scheduling follow-up visits to potential customers under contract with another vendor. For example, a sales representative may collect and record contract expiration dates through cold calling efforts and schedule future calls or visits accordingly within the CRM. In this way, she can avoid overlooking possible sales opportunities.
Because of the elaborate records, the CRM system keeps on customers and their purchasing habits, many businesses incorporate them into their marketing plans. Reports generated to reveal buying trends focus marketing efforts by pairing customers with the most beneficial products. This information can save time for marketing and advertising departments, especially during blitz or holiday seasons.
CRM Data Management Best Practices
CRM data management best practices will make it easier for you to maintain your customer relationship management system. There are multiple ways your organization can maintain your CRM database.
Below are some CRM data management best practices worth checking out:
Avoid Incomplete Contact Records
What customer data is most important for your organization to capture? The answer to this question will determine which information you must capture in your lead form and enter into your CRM system.
It can be tempting to collect and gather as much information as possible for each lead. However, the influx of data can lead to unnecessary questions and overly complex and long lead forms that potential customers will not likely fill out at all. Limit the data fields for only the crucial contact information you want to obtain.
If you don’t get all the crucial information you need from a lead, don’t mark the contact as complete in the CRM. When incomplete data is excluded, the easier and quicker the data can be cleaned and updated. The upload of the data into the CRM will also be faster.
Have Standardized Data-Entry and Naming Conventions
To help prevent inaccurate, unnecessary information from entering into your CRM system, put standards in place for how data is entered, named, and labelled in the CRM. This makes it easy for members of your organization to access the data they need. In addition, when all the data is entered into the customer relationship management system in the same manner, leads are also handled smoothly should a sales member be absent or leave.
Run Regular Data Audits
As with any database, your CRM will get cluttered over time with contact information that is incomplete, outdated, and inclusive of unresponsive leads that aren’t interested in your products or services. While this information in your CRM may look impressive, it is useless to your sales team.
Regular data audits need to take place to cut out those unnecessary pieces of data that weigh your CRM down. Depending on how much data is in your customer relationship management system, it is recommended that a data audit be conducted at least once a quarter. Analyzing and assessing your CRM data will make it easier for you to clean and maintain it. With only the important data of “hot” leads left in the CRM, the data can be easier to keep up to date.
Enter Data in Real-Time
Have you attended a meeting to take action on the things discussed in the meeting only to postpone them because other things popped up later in the day?
Nobody can control the “emergency” or urgent tasks that unexpectedly come up.
However, the more time passes since you scribbled notes from the team meeting, the fewer details you’ll remember.
When it comes to talking about your sales strategy and leads, if you fail to annotate important notes or scribble vague words, you will likely forget them the longer you wait, even if no other tasks come up to divert your attention.
To ensure data is accurate, updated, and complete in your CRM, enter the information and data right away, preferably in real-time, as the meeting or interaction with a customer is in progress. This way, the information will be fresh.
Only Import Essential Contact List Data
Since the risk of errors and inaccuracies increase the more data is imported into your customer relationship management system, it is important you only import essential, complete, accurate data. You will also want to be organized and systematic when you import contact list data into your CRM.
A good way to ensure that you’re only importing the information you need, consider how it will help your organization achieve its sales goals. When you prioritize the import of essential data, your CRM will be more useful. In addition, your CRM will contain more accurate, reliable data that will be easier to regularly update and maintain.
Ensure Data is Formatted Correctly Before Contact List Importing
It is common for salespeople to immediately import data and information from their interactions with leads into the CRM database. While it is good to enter new leads into the contact list while the conversation details are still fresh in their mind, the automatic importation of such data can lead to problems down the road, including making it harder to maintain your CRM system.
Excel spreadsheets are the most common ways data is represented when it is imported into a CRM. While many CRM systems accept .csv files, the two may not have matching data fields.
Often, the Excel spreadsheet is read, converted and synched with the CRM system that may exclude important data. Set up your CRM correctly and train your salespeople in a uniform contact list format and import procedures to minimise the risk of losing or misplacing data.
The information in the right format before getting imported will make the data within the CRM more transparent, understandable, accessible, and useful to anyone accessing the CRM.
With a unified format, your sales team anany new members you add can begin to make use of your CRM. When the data is formatted and imported correctly, the members of your sales team will save time and energy when they need to find it.
Validate Email Addresses and Phone Numbers on Lead Forms
The most important lead information you’ll need for your CRM system is contact information. Make sure your lead form is designed to capture relevant contact information, such as phone numbers, email addresses, social media pages.
To better ensure that the data in your CRM is current and correct, use lead forms that require users to fill out their contact information. This can filter for high-quality leads and streamline CRM maintenance.
It is important to note that bots out there will spam and clog up your CRM system and skew your data. Unfortunately, there are also web users who will leave spammy email addresses and invalid phone numbers. Fortunately, many lead form generators have built-in security measures to prevent users and bots from leaving invalid emails and phone numbers. You can also mitigate some of the problems of false leads in the design of your lead forms.
Look for Duplicates
Few things are as frustrating to a salesperson as coming across duplicates on the contact list. Two of the main causes of duplicates are when someone enters in a new contact with different contact information and when the same person enters different contact information. Duplicates are confusing and lower the productivity of your sales team. They can also annoy leads as you’re sending multiple emails and phone calls to the same person multiple times a day, which lowers the probability of a conversion.
Eliminate Unresponsive Contacts
You have thousands of contacts in your CRM system. How many of them are current and responsive? It can be easy to see each lead as a potential customer and enter them into your system. However, old and unresponsive leads clog up your CRM system and unnecessarily take up the time and effort of your salespeople. Those unresponsive leads also cost your organization money that could be better allocated to leads that will convert.
Removing unresponsive contacts from your CRM will clean it up and allow your sales team to dedicate their efforts to leads that are more likely to convert. As with duplicate contacts, the thinning out of your leads in your CRM will make it easier for you to maintain. It will also make your sales efforts more effective and efficient.
Track Lead Sources
Do you know where the leads in your database are coming from? Are they coming from your paid efforts or organically through search? Knowing where your leads are coming from can guide you where you should focus your marketing and sales efforts. When you know where your leads are coming from, you can also engage them better.
10 Ways A CRM Can Make Your Business More Efficient
I would hazard a guess that most people now know that CRM technology is a critical business tool. However, I don’t think many people know the wide range of functionality a CRM has and just how much more efficient it can do your business. Furthermore, I don’t know if another business-related technology is as versatile and beneficial as CRM.
Despite this, most businesses fail to use their CRM to its full potential. Instead, businesses tend to only use a few functions, missing out on the huge benefits throughout a company.
Here are ten ways a CRM can make your business more efficient:
Understanding Your Data
Any business in this day and age is bursting with data. A CRM will allow you to manage it effectively even if you have far too much-fragmented data coming from various departments. A CRM system helps you to make sense of this. It connects you and your team to a central database making your data actionable throughout your company.
Make the Most of Your Data
Another key aspect of a CRM is that it will help you get the insights you need to make the most of your data. For example, which accounts are currently dormant? A CRM system will allow you to schedule activities to re-activate stagnant accounts. Without these insights, you and your team are missing opportunities and not utilising your data effectively.
Accessing Your Data Anytime, Anywhere
Your data is no longer bound to the office. With advances in cloud computing and mobile/tablet applications, you can take your work with you wherever you go. For mobile employees, a CRM will give instant access to a centralised view of sales and support activities which is customisable to each individual.
Productivity Is Key
Do you always know what your team are doing? Do you often feel the valuable time is being wasted? A CRM will allow managers or team leaders to analyse how much time is being spend on particular tasks and then share this with the team giving them vital directions to best meet their business goals. Thus getting the most out of each and every employee.
A Great Tool for Teamwork
One of the brilliant things about a CRM is that it brings your team and company together. Even if you are a multinational organisation with offices worldwide, a CRM brings everything together and allows all employees to instantly share information.
C Is for Customer
Yes, with Customer Relationship Management software, one of the key bonuses is that it helps you keep your customers happy. Your customer information is instantly access all in one place, making business transactions smooth and fuss-free. It also allows you to manage your accounts easily, ensuring that your customers are never left waiting.
A Happy Customer Is a Loyal Customer
You can’t force a customer to stay with you. However, you can influence their decision by giving them the best experience possible.
A CRM will manage all activities concerning customer engagement, giving employees all the information required to forge the best possible relationship with the customer.
Decision Making Made Easy
CRM highlights crucial information. Business owners and managers can benefit from detailed reports that can forecast sales and returns, measure service activities and track business performance in detail. CRM analysis tools can also follow both short- and long-term trends and problems and alert users to potential business opportunities. These tools mean that the CRM does most of the thinking, and you just have to act on the obvious.
Creating Exciting New Sales Avenues
A CRM can also allow businesses to accept orders from the internet and mobile devices. It also enables businesses to build marketing presences on and accept orders from social networking sites. It allows you to take advantage of all our modern-day trends and platforms and use them to your benefit.
Looking after Your Revenue
Many companies make the mistake of trying to manage revenue through CRM. Instead, you should use CRM to manage all the activities that focus and influence your sales and revenue to ensure you achieve your targets.
Frequently Asked Questions
A type of test execution tool where inputs are recorded during manual testing in order to generate automated test scripts that can be executed later (i.e. replayed). These tools are often used to support automated regression testing.
Market research or market survey is the tool that can be implemented to measure customer relationship, customer satisfaction and customer loyalty.
There are three main types of CRM systems: collaborative, analytical, and operational.