There was a time when people would remember the contact details of friends and family. Today, you cannot move without the contacts app on your phone. Why waste time and effort cramming the numbers when an app can do that better? It is impossible to remember all the details of emails and mailing addresses. This holds true for large companies, as well.
In the modern business world, most policies are customer-centric. Pleasing customers and building good relationships are the primary goals. Most businesses thrive on excellent customer support and service.
However, the larger the consumer base, the harder it is to manage customer relationships. This is where CRM (Customer Relationship Management) software comes in.
What Is CRM Software?
You might have heard and read this acronym many times. But what does CRM stand for?
CRM stands for Customer Relationship Management, which is the core of business operations. It is a tool that helps companies track their business relationships, manage marketing and sales operations, and provide customer service.
At their core, CRM tools maintain customer databases and business contacts. However, thanks to new tech, CRM now also supports marketing and sales processes. As a result, CRM software helps software experts use CRM tools for various business activities.
Meaning of CRM
CRM is all about managing your business relationships and connections with existing and new customers. The purpose of CRM is to improve relationships, thereby helping companies stay connected with their customers. With CRM software, companies align their processes and enjoy a higher ROI.
For a better understanding of the term, let’s break it down.
C – Customer
No business can thrive without a loyal consumer base. Customers are the building blocks of any business. Besides, the way a business manages its contacts plays a major role in its success. Customer-centric companies generate more revenue than other players in the market.
R – Relationship
Perhaps the term "relationship" is the most important part of CRM and for any business to grow. Are you wondering why? If yes, then here is the answer. Your relationships with your customers define the future of your business. They are a link between your customer needs and your business offerings.
Unsurprisingly, improving the quality of relationships and customer retention is one of the main reasons why companies adopt a CRM system. CRM tools are focused on relationships and help you find and manage your contacts.
M – Management
If you want your relationship to work, you have to put in an effort. Show with your actions that you care and don’t take your partner for granted. Business relationships are no different. You should know everything about your customers, their needs, and your concerns.
CRM helps you manage your relationships with hundreds of thousands of customers. It gives you an insight into the customers' expectations and their buying trends. It is not wrong to say that CRM is a mini social network that connects you with people, including customers and business clients.
Purpose of a CRM System and Its Role
First, the main purpose of customer relationship management is to bring together data from various departments and instantly have a holistic view of each customer. Without a doubt, CRM is the leading database management system in the software market today.
If you want your business to grow, you need strategies, sales targets, objectives, and adequate profit margins. However, tracking your progress can be a bit tricky. Moreover, you need a way to turn the data from various channels into meaningful info.
A CRM system does that for you. CRM starts by gathering details about the customer through many sources. The channels include the customers’ website, telephone, email, and social media accounts.
CRM may also pull in information, such as the company’s current business activities and customers’ personal choices—their likes and dislikes. This helps companies build strong relationships with customers over time. According to Gartner's prediction, CRM is going to be the “single largest revenue area” in the enterprise software industry by 2021.
Types of CRM
Some businesses may want a quick way to contact clients, while others may need to approach each client personally. Some might only be looking for a better way to document interactions with clients.
However, the basic idea behind CRMs is the same: to better understand contacts/customers and use the information for growth.
Let’s have a look at the three main types of CRM software that your business may need.
Operational CRM
First, operational CRM software streamlines the main business processes, including sales, marketing, and service automation.
Its main goal is to generate and convert qualified leads into loyal customers. To achieve this, operational CRM collects and organizes essential customer details, ensuring a smooth and personalized customer experience.
Additionally, operational CRM supports the communication teams that interact with customers daily. It centralizes all customer information, including communication history, needs, and preferences, in an accessible database. This unified view lets any customer care agent quickly retrieve relevant data, ensuring consistent and effective communication across all channels.
But how does operational CRM achieve this efficiency? It’s through powerful automation tools that drive each core area:
1. Sales Automation
Sales automation helps a company in many ways. Firstly, it helps set standards/targets within the organization for acquiring new customers and retaining existing ones. In addition, operational CRM organizes the data to make it easier for companies to meet customer needs.
One key tool within this automation framework is CRM and Deals for Zendesk, which simplifies the management of sales pipelines and customer interactions. With features like contact management, sales forecasting, and lead management, businesses can streamline their sales processes.
CRM and Deals for Zendesk allow sales teams to track every stage of the customer journey, from lead generation to closing deals, ensuring that no opportunity is missed.
2. Marketing Automation
As the name suggests, marketing automation improves a company’s marketing performance by automating many processes. The main aim is to find the best marketing methods to approach customers. The most promising solution is to integrate marketing automation tools if you want to optimize managers’ jobs and bring more revenue.
Campaign management is the main module. It helps businesses choose the best mediums or channels to reach potential customers. Some popular communication channels include emails, telephone conversations, face-to-face meetings, and social media advertising.
3. Service Automation
Service automation helps companies retain customers through high-quality services. It helps build strong connections with the customer and earn their trust. Service automation focuses on:
- Issue management to address customers’ problems;
- Customer call management for handling incoming and outgoing calls;
- Service label management for monitoring the quality of the customer services based on the performance metrics.
Analytical CRM
Analytical CRM is designed to help the top management in sales and marketing. It supports personnel in finding the best ways to serve customers. Essentially, the main purpose of analytical CRM is data analysis.
The app monitors customer data that comes from different touchpoints for better know-how of the company’s status. Analytical CRM helps the top tier to make better decisions. The app helps marketing executives know how good or bad their campaigns are.
Also, it supports the sales executives in increasing sales and customer care personnel to improve service quality. So, analytical CRM helps to:
- Gather details about the customer coming from various channels and systematically analyze the data;
- Devise a unique way of sales and marketing;
- Build strong connections with customers and earn their trust;
- Gauge the performance metrics and use CRM to its fullest.
Collaborative CRM
In most companies, each business unit likes to work without sharing customer details with other sections. This approach often results in a loss for businesses. Collaborative CRM is an answer to this problem.
A business should have its departments on the same page. Collaborative CRM software, also referred to as strategic CRM, helps the company hit this goal. Here, the CRM tool allows the company to share customers' data across departments.
For instance, customer support feedback can help the marketing team develop better ways of promoting products and services. They can approach hot leads with exactly the products they need.
Hence, this CRM gathers all groups within a company with a common goal: to use the data to improve the CX. Not only does it help retain customers, but it also attracts new ones.
Benefits of Customer Relationship Management
While the sales teams benefit the most from CRM, the software helps every unit of the business in some way. Besides increasing sales, CRM has emerged as a tool for improving customer experience. Let’s have a look at a few of the many advantages CRM offers to your business.
A survey of 500+ companies about their expectations for the benefits of CRM systems. Source: SuperOffice
CRM Gives a Customer’s Holistic View
With CRM software, you get a holistic view of the customer’s relationship with your brand. It gives you an overview of the customer’s past association, their shopping trends, their orders’ status, and their issues and concerns.
For instance, a customer may register a complaint on one channel, like Facebook, and then move to private chat to resolve the matter. CRM enables you to handle the issue across multiple channels without losing track.
It will provide the sales, servicing, and marketing units with a single view of the customer. Thus, the teams can make well-informed decisions and improve the quality of the service.
CRM Connects You to Business Apps
Strong customer relationships are crucial to a business's success, and satisfied customers are an asset to your organization. CRM helps you build long-lasting relationships with customers and connects you to business apps and tools.
The landscape is dynamic, and you can integrate CRM with the best business tools in the market. For instance, with a CRM platform, you can integrate document signing, surveys, and accounting and billing. The integration allows the information to flow both ways, giving you a 360-degree view of your customer’s activity.
CRM Helps Generate Qualified Leads
CRM platforms help you identify qualified leads, i.e., the right customers for your product or service. Using the data from CRM, you can target the right customers and increase sales. You get better insight; thus, you can focus on nurturing them and converting them into potential buyers.
The information that you store on the CRM software helps sales and marketing teams make better decisions. They can shift their efforts to the right people at the right time.
CRM Helps Retain Customers
Today, customers look for instant service and appreciate personalized support. With a CRM system, you can serve the needs of your customers in real time. CRM gathers all the info in one place, which allows the agents to reach out to the customers on time.
The quick response helps identify the signs of customer churn at an early stage. Prompt action also helps companies retain their loyal customers. Harvard Business Review reports that a 5% decrease in customer attrition increases profit anywhere between 25 and 85%.
Another study by Capterra found that 47% of CRM users find CRM an effective customer retention tool.
CRM Software helps Acquire New Customers
A loyal consumer base helps your business to expand and thrive. When you know the customers better and cater to all their needs, you win them over. A happy customer increases your cross-selling and up-selling chances.
Today, more than 71% of buyers make their shopping decisions on social media referrals. Also, a whopping 93% of customers rely on online reviews for shopping.
Final Thoughts
In the past, customers used CRM as a marketing and sales tool. Today, it is one of the best tools to improve your relationships with customers. CRM helps automate the sales operation and allows managers to track their team performance. Above all, it helps improve communication across the various departments within a company.
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