What is CRM?
A definition of CRM
and why it's so important for your business.
What is CRM?
CRM is an abbreviation for Customer Relationship Management. It’s a system used to build and manage customer relationships.
A CRM system helps businesses manage all the interactions it has with customers and potential customers. With a CRM platform, customer preferences are recorded, and customer activity can be tracked. So every time they are spoken to, regardless of who they talk to, customers get a fully personalised and consistent experience.
CRM software helps organisations streamline their processes and workflows so that every part of the business is on the same page. Sales and marketing teams, especially, rely on CRM to create collaboration and improve their productivity.
Check out this brief video to learn more
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What is the meaning of CRM?
When you hear people talk about CRM, they might refer to the overall strategy of customer relationship management. Its goal is to increase sales and profitability, create long-lasting relationships with customers, and increase customer retention. It focuses on putting the customer first and delivering a better, more personalised customer experience.
On the other hand, people often use ‘CRM’ for the technology, which helps a business keep the information of all its customers, leads and prospects stored and organised in one place. In addition to this, a CRM solution allows a business to track all customer interactions.
What can a CRM system do?
A CRM system maintains and manages data obtained from multiple sources and touchpoints, including email, the company website, live chat, telephone, and social media, etc.
It’s a database that stores customer-specific data like buying history, specific wants and needs, purchasing preferences and financial demographics, creating a holistic view of the customer, and promoting more engaging and consistent interactions.
Some other features include:
Reporting and dashboards: A CRM provides its users with the ability to visualise important trends and business metrics.
Sales management: With a CRM software, a business can track its sales process from the initial lead, or prospect stage, to becoming opportunities, through to the final order conversion stage.
Marketing campaign management: A CRM system allows you to manage campaigns from start to end using automated workflows wherever necessary.
Service management: A CRM system allows you to manage service delivery from before purchase, to contract delivery and renewal, and whether your service is preventative or reactive, and delivered on site or remotely.
Insights generation: A CRM tool can also analyse large amounts of data and generate actionable insights from it.
In addition to allowing a business to manage its customer relationships better, a CRM also helps in:
Increasing revenues by increasing sales opportunities: A sales CRM system provides an organisation with information and insights it can use to identify more sales opportunities.
Segment customers with ease: A CRM allows you to profile your customers based on purchase indicators like history, demographics, engagement and level of interest etc.
Cross-departmental alignment: A CRM system helps in aligning your marketing and sales teams which creates harmony within the workforce and increases productivity.
Selecting a CRM solution that fits your needs (and your wallet) can be tough. Before you invest in a particular system, it’s important to be clear about your priorities, IT competence, and budget right from the start. Our free CRM guide will help you find the right CRM product for your business.
Why is CRM important?
The customer base of a business is one of its biggest assets, if not THE biggest. However, especially when you are trying to grow your business, it becomes more challenging to keep track of your customers and potential customers.
You might ask yourself, who are our customers, what do they need, and when was the last time we interacted with them? Is our sales pipeline healthy? Are customers engaging with our content?
Your customers and prospects will most likely start to wander off. They aren’t happy with merely a high-quality service or product. They need to feel engaged, and they want a business to give them the respect and personalised experience that makes them feel like they belong.
With a CRM system, a business ensures that it establishes long-term customer relations by knowing every detail (their needs, wants, and behaviours) about them, at all times. A satisfied customer is more likely to return to your company for more purchases and to recommend your products or services to their friends and family.
Not sure if your business needs a CRM system? Check out these ten signs you might need a CRM.
A survey conducted on Act! customers revealed that 75% of users believe that their CRM software helped them grow their business1.
What are the benefits of CRM?
Collaborate through integration
Integrating data from different functions of a business helps you maximise effectiveness through collaboration. For example, potential customer contact details can be ‘pushed’ from lead capture forms on your website, into ‘hot lead’ action lists in your CRM solution – maximising collaboration between marketing and sales.
Manage pipeline effectively
By being able to visualise your sales pipelines, you can see exactly which deal needs your immediate attention and which deal has gone stale. By periodic monitoring of deals that pass through your pipeline, you can identify areas of concern and eliminate them, ensuring a clog-free pipeline at all times. Additionally, your marketing and sales team are better connected, ensuring your sales pipeline is always filled with high-quality leads.
Automate for maximum productivity
Businesses often execute various processes every day that consist of a series of redundant tasks carried out by multiple users. A CRM system can help you automate those processes to save time and drive consistency. You can automate tasks such as scheduling follow-up activities, sending email campaigns, or assigning contacts to a new sales rep. This way, you can make sure all your team members are following the same process from start to finish, and you eliminate the need for repetitive manual work.
Engage to build lasting customer relationships
In the modern technological world, a customer expects a lot more from a company than just a reasonably-priced, high-quality product or service. They want to feel understood, and they want to have an engaging, personalised experience whenever they get in touch with the company or vice versa. A CRM captures and stores every customer’s journey from the start to the very end. By knowing their preferences, you can understand their needs, and by eventually giving them what they need, you get their loyalty in return.
Improve customer experience with shared information
For example, if a customer experiences a problem with your product, multiple teams can work together to solve the issue. While your technical support team is fixing the issue, the customer service team can communicate the solution to the customer and provide further assistance. At the same time, the marketing team can adapt their messaging.
A CRM helps you improve levels of customer satisfaction, and retention – happy and long-term customers entail increased revenues. It also lets you save a lot of time by automating essential business tasks and promoting collaboration between different business functions. These time savings and productivity gains enable you to lower costs. Lastly, with a CRM system, you can create targeted marketing campaigns so that you can reach out to the right people at the right time and increase sales.
Which business functions need a CRM system?
Marketing is not just about creating the perfect campaign; it’s also a lot about reaching out to the right people. With a CRM system, you can divide your customer base into segments, allowing you to send customised messages to every segment.
Benefit from improved lead management: Lead capture forms on your website can be integrated into your customer relationship management software and passed on to your sales team to follow up.
Since all the customers’ activity is tracked in the system, marketing can gain valuable insights into their behaviour.
With CRM technology, your sales team can streamline the whole sales process and shorten the sales cycle. By being able to visualise the sales pipeline, your sales reps can identify the deals that require immediate attention and focus on the most valuable opportunities.
They can schedule calls, follow-ups, and meetings, take notes and send invoices. Additionally, your sales manager can run sales reports and forecasts to track all sales activities and review their team’s performance.
Customer Service Team
Using a CRM system helps you store customer preferences and track all activities associated with them. If a customer tells you that they don’t want to receive weekly email updates, you can simply tick a box against them in the CRM, and the emails will stop.
Your customer service team can manage and monitor any post-sale interactions in the CRM system and share important updates with the sales or marketing team. This way, they can fix potential issues and provide solutions faster.
So how does a CRM system work?
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On-premise CRM vs Cloud CRM: which is best for you?
A Cloud CRM is simply a Customer Relationship Management system that uses Cloud computing technology to host your CRM application. In other words, your customer data is stored on the CRM vendor’s servers in a data centre. A traditional CRM system hosts your customer data on a server in your office.
One of the major benefits of Cloud CRM app is that there is no hardware to install or software maintenance issues to worry about, compared to taking things in-house. And without the often significant upfront capital expenditure on IT infrastructure or data centre costs, the Cloud’s ‘pay as you go’ approach is very appealing to many businesses.
Cloud computing is often more secure than many private data centres. A good Cloud service provider will have robust processes in place to ensure your data is protected, accessible at all times, and regularly backed-up.
Learn more about Cloud computing solutions and download our free guide ‘Moving to a Cloud solution: 35 questions for you and your vendor’.
Who invented CRM?
Pat Sullivan and Mike Muhney released the first-ever CRM in 1987 by the name of ACT!. It was basically a digital Rolodex that enabled its users to organise and store customer information effectively.
In the 80s, a lot of features that contemporary CRM systems have didn’t exist yet. ACT! made the development community realise the possible benefits of a system that harnesses the power of customer information to help a business manage its relationships better.
At the time, the term “CRM” did not exist. It was only in the 90s that people started to use it, after features like sales automation, enterprise resource planning, and marketing capabilities complemented the contact management features of the software.
Here’s a quick summary of what you should know about CRM:
- Definition of CRM: CRM is an abbreviation for Customer Relationship Management. It’s a system used to build and manage customer relationships.
- CRM system: A CRM system is a technology, which helps a business keep the information of all its customers, leads and prospects stored and organised in one place.
- Importance of CRM: With a CRM system, a business ensures that it establishes long-term relationships with its customers and streamlines processes to improve customer service, and drive business growth and profitability.
- Benefits of CRM: Building lasting customer relationships, streamlining and automating processes, creating better collaboration and communication, better pipeline management, and increased revenues
- Who needs a CRM? Sales, marketing, and customer service teams, as well as small business owners.
- On-premise v.s Cloud CRM: A Cloud CRM is a CRM system that uses Cloud computing technology to host your CRM application. A traditional CRM system hosts your customer data on a server.
- History of CRM: Pat Sullivan and Mike Muhney released the first-ever CRM in 1987 by the name of ACT!.
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