CRM stands for Customer Relationship Management. This is the process by which companies manage important information about their leads and customers. CRM, which is also commonly used in place of CRM Software, helps businesses to track their interactions with leads and customers.
Likewise, this CRM tool helps a business to know what stage each contact is (e.g., awareness stage or consideration stage), and the actions to be taken to turn them into customers.
With the right ‘nurture campaign,’ you can get a paying customer for your business. You can even land a big customer.
But to increase the number of customers you have, and to make them repeat customers, a CRM software is an essential technology your business must invest in.
10 Reasons Why your business needs a CRM:
Having provided a brief explanation about CRM, what are the specific benefits your business will gain with the use of a CRM software today?
1. Customer Relationship Management for Sales
An information about your customers gives your business an edge; since you’re able to communicate your message better -- thus increasing sales and revenue.
A study by Salesforce shows that CRM can increase sales by up to 29% and sales productivity by up to 34%.
Aberdeen Group found that effective sales organizations are 81% more likely to be using CRM or other record systems.
Let me give you an instance: One of your leads lands on your website and reads 3 pages/posts about a particular product. Then they visit your sales page for the same product. What does this tell you?
They have a considerable level of interest in your product. With a CRM software, you’ll be alerted about this particular lead. Then you’ll follow up with a ‘relevant and irresistible’ offer or even a discount to make sure such a lead buys from you.
What if you have no CRM? You could lose that sale to a competitor who uses CRM.
That’s why more businesses are spending a part of their budget on CRM. At the end of 2017, CRM overtook database management systems to become the biggest software market. Gartner predicts CRM spending will exceed $40 billion in 2018 due to a growth rate of 16%.
2. Marketing Automation
In time past (about 20 - 30 years ago), companies have records of their leads and customers on paper. They have to take every action manually. How stressful was it?
Of course, it’s only human that they’ll forget to call one lead or send product information to another lead. It was common to see many sales slip through these cracks. But not anymore.
CRM systems help you to automate your marketing efforts based on the actions of your leads and customers. Why? So that when they read articles about a product, your CRM can tag them as being ‘interested’ in that product and automatically send relevant offers that you have provided.
Or when they abandon their cart at the point of buying, your CRM could trigger a “cart abandonment sequence” that would send relevant offers via email marketing to make them complete their sales.
AgileCRM does it better. Here’s an illustrative example of a promotional campaign workflow:
With the use of CRM, you can automate most of your marketing tasks. It all depends on your creativity really. VentureBeat reports that marketing automation users had an 80% increase in leads acquisition and a 77% increase in conversions.
3. The Flexibility of The Cloud
The Internet has made many changes on how we do business. But even the Internet of 10 years ago is different from that of today.
Due to more functionality of websites, the Internet is getting faster and more secure. With most CRM tools now hosted on the cloud, there is a better security for your customers’ information.
Also, you don't need to install software manually on hundreds of computers before you can implement the system. You can store as much information as you want as the cloud gives you a flexible infrastructure.
The flexibility of the cloud also allows you to have remote workers who can have access to the CRM while they're out of office. Salesforce was the first company to offer CRM through the cloud but other companies have since followed suit.
In a study by Software Advice, they found that 87% of companies preferred cloud-based CRM in 2014 compared to only 12% in 2008.
4. Replicating Best Practices
For most businesses, employees have no access to their best practices on how to interact with customers.
However, with a CRM, every information about your best practices with respect to interacting with customers is available to all your employees. This makes it easier for employees to follow these best practices while serving your customers.
A large pharmaceutical company wanted to merge its R&D division in the United States, Japan, and Europe. They wanted to harmonize their standard operating procedures (SOPs) to eliminate inconsistencies in their operations.
With the development of a single system that harmonized their processes and best practices, they reduced their SOPs by 40%.
5. Keeps Your Team Organized
One of the major issues companies faced in the past was the presence of silos.
For example, a marketing department has some information about leads that are unavailable to the sales department, yet the sales department needs this information to turn these leads to customers.
This makes the company look disorganized. With the right CRM, every department has access to all the important information they need about a lead.
In some cases, customers communicate with a company on different channels. For example, a customer might continue a phone conversation via an email communication.
CRM tools help businesses to keep track of these cross-channel interactions. The teams are organized as customers’ interactions with various departments are seamless due to their access to information that used to be unavailable. In a study by Software Advice, 74% of CRM users claimed it gave them a better access to customer data.
With the use of CRM, Mayfield Plastics was able to reduce their customer service response time from 4 days to a few hours as they spend less time looking for customer’s information.
6. Effective Risk Management
One of the most important elements of risk management is being able to identify the risks. With a CRM system, you're able to identify risks easily which helps you to effectively manage the risk.
Apart from identifying risks, a CRM also gives you information to understand the details of the risk.
For instance, you can easily identify a dissatisfied customer by what they posted on social media about your company or how they communicated with your sales reps.
Likewise, a department head can easily identify an employee who is having awful interactions with customers that may lead to the loss of those customers. With this information, companies are able to minimize risks in their business.
7. Doing More With Less
Even though many may consider the cost of installing a CRM software expensive, it depends on how you look at it. Is it up to the wages you’ll pay an extra employee?
Yet no single employee is capable of all the automation and other features that a CRM offers you. Furthermore, a CRM makes all your employees more effective in turning your leads into customers and turning your one-time customers into repeat customers.
Your employees can interact with many customers now while delivering a higher level of customer satisfaction. In a study by Capterra, 47% of CRM users claimed it improved their customer satisfaction and the same percentage believed it improved their customer retention.
And you can achieve this at a lower cost than it would take to hire an extra employee.
8. CRM Saves Cost in the Long Run
With the use of CRM, you get more ROI in the long run. The amount you invest is drastically reduced as you don't need to install IT infrastructure or other hardware before you can use it.
More so, it reduces the need to hire more employees as the CRM reduces the workload of the current employees. According to Nucleus Research, companies get $8.71 return on $1 spent on CRM.
9. Customer Intimacy
When you have vital information about your customers, your interactions become better and more intimate. Furthermore, customers appreciate the fact that you know some things about them without having to ask questions all the time.
Also with CRM systems that integrate with social media platforms, you can have more interactions with your customers. This will improve intimacy and allow you to serve the customers better.
When you improve your service, customers become happier.
This shows that you care about your customers. Many customers find themselves going back to Amazon to buy more and more products because Amazon knows them so well.
With its efficient recommendation system which recommends products to users based on their past purchases, customers find more things they want with their upsells and cross-sells.
Amazon also builds an intimacy with customers because the company can recommend what customers want before they start searching for it. With these strategies, Amazon has been able to turn 80% of its customers to repeat customers.
10. Email Automation
One of the most intimate ways you can connect with your customers is through email. Your message can get lost on social media due to NOISE.
No matter the amount of promotion you do, you can only reach a small number of your potential customers via other channels other than the email.
When it comes to the effectiveness of your marketing campaigns, it will be hard to find a channel that beats email. That's why marketing experts recommend you have an email list for your business as soon as possible.
Marketers don't just love email, research shows that for every dollar you spend on email, you make $44 as returns.
Why is email marketing so effective? It’s because people check their emails regularly.
As long as your message is delivered, most of your email subscribers will see it -- which is already a better chance than you’ll have on other channels. Statista estimates that 98.4% of Americans open their emails at least once in a day and 38% open it at least 10 times.
Having stated all these advantages of email marketing, a CRM even makes it more effective with automation.
With a CRM platform like AgileCRM, you can build an email list to engage with your leads and customers. Interestingly, you can also connect your email marketing software to your CRM.
After that, you can send personalized messages to each of your subscriber based on their interactions with your website, marketing message, and sales reps. Why is this important? Personalized email subject lines are 26% more likely to be opened and marketers have increased their email revenue by 760% due to segmented campaigns.
With email automation on your CRM software, you can make a lot of sales and satisfy your customers while automating every aspect of your marketing activity.
CRM software helps your employees to sell more products to your customers. You can also achieve this while improving customer satisfaction. How cool is that?
All these benefits come with a reduction in the cost of your service and customer acquisition. If you’re asking a question about implementing CRM for your business today, it should be a matter of “when?” rather than “if?”
All these benefits show that it's a no-brainer to use CRM for your business. So what are you waiting for?