Gone are the days when having a good quality product and a smart advertising campaign was all that a company required to guarantee for itself a top place in the market. Today’s tech-savvy customers require a lot more than that. When it comes to any particular type of product or service, customers have multiple choices and the internet has made it possible for them to be aware of it as well.
Today a business cannot stand out among its competitors, by taking a generic approach to all customers and offering fit-for-all solutions. Instead, it has to find ways to understand individual customers, engage their attention and build relationships with them. In short, companies aiming for success have to embrace a more customer oriented approach and this is where CRM comes into the picture.
What is CRM?
CRM stands for Customer Relationship Management. It is an umbrella term for all the management strategies, tools and methods adopted by businesses to build relationships with their existing and prospective clients. CRM helps companies identify and understand the consumers. Using this data, they can optimise the quality of the products and services offered and market them strategically.
In addition, by skilfully managing customer interactions, companies can also capitalise on the feel-good factor for building their image and inspiring brand loyalty. All this would not only improve customer retention, but also attract new customers, both important factors that boost sales and increase profits.
How does it work?
The first step to implementing CRM in a company is gathering data about the clientele. The database is stored in a robust and versatile system that allows specific client details to be accessed based on the purpose. By analysing the information generated, the potential leads can be identified and classified into categories. For each of these target groups, specific marketing, sales and service strategies are crafted. The personalized content delivered through channels such as emails, newsletters, social media, chats and phone calls would ensure maximum conversion rates.
CRM software provides a platform for customer-business interaction. Feedback obtained directly from the customers and also data collected through collaborative sources is used to further streamline the business processes. Strategies that work can be re-used and what doesn’t can be discarded, improving marketing efficiency.
Considering the sheer volume of data and data management involved, it is impossible to manually execute the CRM processes. For this purpose, there are several CRM softwares available which can be purchased and implemented based on the specific nature of a company.
Even for large firms that have in-house or licensed CRM softwares, storing and processing the CRM related big data would be a challenge. Owning and maintaining large servers required for this would often involve high capital and maintenance costs. Cloud CRM is an innovative solution that was developed to tackle this problem. The data as well as the software can be placed on the cloud by paying a small premium to the service provider.
Software as a Service CRM or SaaS CRM is another development and it revolutionized CRM for small businesses. Earlier, many of them had to rely on inefficient manual methods for CRM as they could not afford to purchase the licensed versions of CRM softwares. With the advent of SaaS CRM, a sub-set of cloud CRM, CRM software providers can now offer their services through the cloud at lower rates on a subscription model. In this way, SaaS CRM made CRM affordable even for small businesses.
Ways in which CRM improves marketing efficiency
The answer to the question “What is CRM?” itself highlights how a good CRM strategy would benefit a business. Some of the ways in which CRM amplifies marketing efficiency are:
- By saving labor –
CRM software makes many processes fully automated. It helps in identifying the right customers for a specific business. It saves time and effort that would otherwise be wasted on chasing after leads that have no potential of converting. CRM also identifies the clients that are most profitable and helps the firm focus their efforts on them. It also helps identify regular end users and distributors and this opens up up-selling and cross-selling opportunities with them.
CRM software helps track the relative success or failure of a marketing strategy. It takes speculation out of the equation. Once a winning tactic is identified, it can be re-used or upgraded each time to guarantee faster and better results. In addition, CRM software also ensures that all business teams are updated on the progress of a deal. In this manner duplication of efforts can be avoided.
- By improving lead conversion rates –
Many a times, customers get put-off when they receive marketing material that is not relevant to their needs. Some of the regular customers may even consider disengaging with the business that sends them content they consider spam. CRM helps in segmentation of the potential and existing customer base so that personalised content can be crafted for each of them in accordance with their requirements.
Products can also be pitched on a one-to-one basis, especially to high potential clients, given that all the necessary information about them and their preferences are available thanks to CRM. It equips the employees with the specific set of information to be conveyed to clients that would yield maximum returns. All these would help improve conversion rates.
- By improving productivity –
The earlier manual methods of record keeping were both time consuming and labor intensive. With CRM software, businesses become smoother and require lesser staff and resources. All information is decentralized as a result of which it can be accessed by all authorized employees. It bridges communication gaps so that all teams can work together in synergy, better complementing each others’ functions. In this way business processes, especially marketing, becomes more cost-effective and yield better results.
CRM systems provide a smooth client interface and also reduce response time from the business side to queries posted by potential clients. Because of this, customers are prompted to make up their minds faster. The reduced turnaround times improve business efficiency.
- By improving customer relationship –
A CRM platform gives clients an opportunity to voice their concerns or share their suggestions. Based on the nature of the feedback, products and services can be enhanced which in turn would improve sales. CRM software also help employees respond quickly to the clients to deliver the assistance that they need. It also updates the employees regarding the protocol to be followed and the necessary details of the client to engage them better.
Timely action and response ensures customer satisfaction better than words of appreciation. The assurance that the company genuinely values them goes a long way in guaranteeing brand loyalty and customer retention. Existing customers are also resources that can help further business. For this, CRM software can be employed to introduce and keep track of programs like membership discounts, customer loyalty schemes and referral bonuses.