A customer relationship management system (CRM) is a software solution designed to help organizations manage their interactions with customers.
A CRM helps automate repetitive tasks, such as sending emails and tracking the progress of leads and deals, freeing up time for employees to focus on more important tasks. In this blog post, we'll take a look at how you can use a CRM in your marketing strategy.
CRM systems automate the traditional processes of manual documentation. For example, with a CRM, you can retrieve contact information and communication pertaining to a certain customer from a database of thousands of customers in a matter of seconds.
Initially, CRM software used to be kept on personal computers. Later, it moved to servers to benefit the entire organization, often spread across multiple geographical locations.
There are generally two types of CRM:
- On-premises CRM: This refers to the CRM software installed on your server. It is mainly popular among small- and mid-sized businesses since it is more affordable and does not involve the complexity of implementing large-scale CRM on your premises.
- On-demand CRM: This refers to the CRM software running on the cloud infrastructure of the software vendor. This CRM is usually priced on a pay-as-you-go basis. On-demand CRM makes a good choice for businesses looking for standard processes across the organization without worrying about in-house maintenance and support. However, companies with sensitive customer data (e.g. a financial services company or a healthcare company) may be wary about trusting their data to a third party.
What is a CRM, and how does it work?
CRM stands for customer relationship management. Traditionally, this refers to managing relationships with customers that uses data analysis about customer preferences and behaviour to provide deeper information about buyers and leads.
However, as this approach has become more widespread, the acronym CRM has come to refer to the method and the digital tools and software used to carry it out.
As software, a CRM is a critical small business marketing asset. It stores data about current and potential customers, analyzes past customer interactions, and facilitates communication between clients and company representatives.
Using this digital tool is important for many reasons. For one, information about customers tends to be all over the place - scattered across social media platforms, buried in the inbox of a customer service rep, stored as a mental note by a marketing professional - the list goes on and on.
When that information isn’t consolidated, it’s challenging to understand your customers clearly and develop a marketing strategy that accurately reflects their needs.
CRMs solve this problem by pulling data from various marketing assets - including a company’s website, social media platforms, and email marketing system - and putting it in a single place.
They also help companies use this data by providing features such as chat tools, marketing automation and contact management.
What Are The 5 Steps In The CRM Process?
The five steps of the CRM process are a collaborative effort between marketing, sales, and support departments. To help you understand how each team works together, we’ll walk through how each step works in practice. In addition, we’ll cover how each part of the process can be completed with a CRM tool and who is responsible for each step.
Generate brand awareness
The first step to acquiring new customers is to introduce them to your business. The marketing team typically takes on this task through a number of measures:
- Learning about your target audience. Marketers will research to identify their audience’s target demographics, interests, preferred channels of communication, what messaging they respond most to, and what they care about.
- Segmenting your target audience. Audience personas are created to segment a brand’s target audience into similar groups based on similar interests or demographics. This helps marketers identify which types of people are most likely to become customers and who their campaigns should target.
- Creating marketing campaigns that speak to those target demographics. A/B tests and marketing automation can identify what works and what doesn’t, create unique campaigns for unique customer segments such as on social media or email, and create strategies for lead acquisition.
When it comes to completing these steps, a CRM solution is a wealth of information. The tool can show past leads and customers patterns to give marketing teams a clear picture of their target audience.
Beyond understanding similarities in demographics, marketers can also analyze sales notes in their CRM technology to understand what led to conversions in the past. By understanding what resonated with leads, marketers are better equipped to create effective campaigns.
Introducing your brand to a potential customer is just the beginning of the CRM process. From there, you have to encourage them to learn more about your business and engage with it.
Depending on how your company is structured, this lead acquisition step could be a marketing or sales team responsibility — or both. Your marketing team, for example, might encourage website visitors to share their email with a newsletter signup CTA or a social media giveaway.
On the other hand, Sales could use their CRM system to set up live chat on your site. With this feature, your team can proactively reach out to potential customers who land on your website.
If your CRM technology comes equipped with a lead enrichment tool, like Reach, lead acquisition is unbelievably simple. All the tool needs is a lead’s email address to instantly reveal detailed information about the person. You can personalize your outreach with the lead to start the relationship off on the right note with customer data. Not to mention, you can save tons of time by not needing to research leads yourself.
Convert leads into customers
You’ve successfully engaged with your leads, and they’re interested. Now it’s time to turn those leads into customers.
To do so, sales reps must first be skilled at identifying how interested leads are and, specifically, whether they’re interested enough to make a purchase.
A CRM system is very helpful here. The historical data from past successful sales can be used to identify lead-qualification criteria.
These criteria can be added as “attributes” to your CRM’s lead-scoring tool to help reps identify opportunities with the highest probability of a sale.
If leads seem likely to make a purchase, reps must then nurture them further and build their trust enough to convert. One way to do this is for reps to send leads to case studies, white papers, and other resources that may sway their decision.
Reps should also use their CRM platform to set reminders and tasks to follow up with interested leads. After all, studies have shown that “63% of consumers need to hear a company’s claim 3-5 times before they actually believe it." So use your CRM’s dashboard to help you remember to follow up to ensure that no opportunities are missed.
Provide superior customer service
You’ve successfully converted your lead into a customer. Great! But the CRM process doesn’t end when a customer converts. In order to grow as a company, you need to retain customers. So how do you keep that customer coming back? Excellent service from support.
According to Zendesk’s 2021 Customer Experience Trends Report, customer service is the biggest factor that determines a consumer’s loyalty to a brand. Conversely, poor customer service can cost you customers and negatively impact your reputation.
Therefore, support teams must be able to deliver superior support whenever, wherever, and however their customers expect it.
Forty-nine per cent of customers say being able to resolve their issue quickly is the most important aspect of a good customer service experience. With CRM software, support agents can easily access the historical customer information they need to resolve a ticket quickly.
Fifty-seven per cent of customers expect to have a choice of channels when reaching out to customer support. CRM features allow support agents to provide omnichannel support and manage those conversations in a single, unified view.
With the right CRM, your agents have the customer information and resources they need to resolve a customer’s issues quickly and effortlessly. This allows for a stress-free and efficient experience for both the customer and the support agent.
When we think of a returning customer, we imagine a shopper continually coming back to the same business to buy the products they know and love. But there is another key way existing customers provide value — by upgrading to more expensive products.
How do you convince customers to switch products? Personalized recommendations via email are a great place to start. You can use your CRM to organize customers into smart lists based on similar purchase histories.
You can then create custom email templates that send relevant product releases to entire lists of customers at once. This way, you can be sure the promotional deals or releases you send are reaching the people most likely to buy them.
Benefits of a CRM System
A CRM system offers the following benefits.
- Retrievable customer data: A CRM system gives access to a searchable customer database. Businesses can use this information anytime they need it. Many CRM systems synchronize this data across different channels and devices to provide the user with updated information.
- Reporting and analytics: A CRM system offers actionable insight into customer behaviour and market trends. You can create various reports to track and analyze the performance of your campaigns.
- Customer service: A CRM system lets you handle customer complaints and queries most efficiently. It usually has a built-in ticketing system that assigns a unique number to each series of interactions. This also makes it possible to merge duplicate queries from the same customer received across different channels.
- Process automation and streamlining: A CRM system increases coordination between different departments by standardizing processes, especially those related to customer service, marketing and sales.
- Product development: A CRM system lets you understand your customers’ preferences and needs. This helps in developing a new product or in aligning an existing product to the market trend.
- Cross-selling: Since a CRM system logs your customers’ purchase history and other relevant details, it becomes easy to cross-sell other products to them. For example, you can cross-sell annual maintenance contracts to customers who have bought a packaged air conditioning system from you.
- Retaining existing customers: A CRM system helps in the timely identification of unhappy customers. Businesses can then take remedial action before it is too late to prevent the exit of existing customers. For example, you can tag all account closure requests from customers as a rush priority. Upon receiving such a request, the customer support team can contact the customer to find out the exact reason for the closure. If the customer is consistently facing a technical problem, the tech support team can be alerted to resolve the issue.
Thus, CRM systems provide and sync customer information to boost revenue and generate more profits. They help businesses create a customer-centric environment and deliver personalized services. Since all departments access the same information from a centralized system, the chances of ambiguity and miscommunication are automatically minimized.
The Impact Of Customer Relationship Management On Your Business
At the end of the day, Customer Relationship Management matters because customers matter. Research shows that improved customer experience drives growth by increasing loyalty. So, if you are in it for the long run, you cannot overlook the relationship you have with your customers. With this in mind, let’s take a closer look at what CRM can do for your business:
Organize and analyze data in a way that is understood and easily accessible
CRM enables data-driven decision making. Informed decisions are the result of understanding the information you have in the first place. CRM lets you access data points in formats that are easy to understand and interpret.
Identify and manage leads
CRM can greatly affect the efficiency of the sales process. For example, Surveypal’s survey integration with Salesforce allows you to create new leads in Salesforce and trigger customized follow up actions based on individual sales lead data. This way, your sales team can cut down on response times and better manage the relationship with the lead.
Anticipate customer needs
With CRM, you gain instant access to data such as contact information, purchase history, customer service contact history, and more. Additionally, you can incorporate Voice of the Customer data into your CRM to enhance your understanding of your customer base. This information is crucial because it enables you to anticipate the needs of your customers and, therefore, make them happy.
Improve products and services
Collecting customer feedback data and integrating it into your CRM gives you a better understanding of customer expectations in relation to the product or service you are offering. These insights can be used to identify issues and improve your offering to meet customer needs.
Frequently Asked Questions
The CRM process is a strategy for keeping every customer interaction personalized and meaningful that consists of five main steps. A customer relationship management system (CRM system) provides the data and functionalities your team needs to execute this strategy—and ultimately turn leads into customers.
Zoho CRM, Pipedrive CRM, Oracle Sales Cloud, and SugarCRM are the most popular with their users. SoftwareReviews found that these four CRM systems have the highest combined Value Index and Net Emotional Footprint scores across all CRM vendors included in the study.
CRM testing is the verification that your CRM system is fully operational and delivers against business objectives before and after the software is installed, updated, or upgraded. ... This means integrating business workflows for a variety of departments, as well as linking a plethora of enterprise applications together.