A Customer Relationship Management (CRM) is a tool designed to manage a company’s interaction with its current and potential customers. It makes use of numerous technologies such as data analytics to gather data about the customers’ history and interactions with the company as a means of improving the relationship. CRM focuses predominantly on customer retention but as a means of ultimately driving sales.
One of the essential features of a CRM system is in the way it compiles data. It takes it from numerous communication channels such as the company’s website, email, telephone, live chat, and social media, among others. With a CRM system, a business can better understand their target audience, know their wants, needs, and pain points, and ultimately cater to those needs as a means of encouraging further business.
Types of CRM Systems
In total, there are five types of CRM systems. Each of them has a specific use, and they are as follows:
Strategic – Strategic CRMs are for the development of customer-centric company culture.
Operational – This type of CRM is the most versatile and therefore, the most widespread. Their purpose is to automate and integrate sales, marketing, and customer support and are comprised of three main components, based on these three departments, automating many of their day-to-day processes.
Analytical – Analytical CRM is used to analyze customer data gathered from numerous communication channels via data mining, pattern recognition, and correlation. It will then examine the information, discovering any problems concerning customer service and help managers make better and more informed decisions.
Collaborative – A third-party CRM system aimed at incorporating suppliers, distributors, vendors, and other external stakeholders to share customer information across all groups and streamline operations.
Customer Data Platforms (CDP) – As a relatively new member of the CRM family, CDPs are marketer-based management systems that collect dispersed information from numerous and, otherwise, unconnected sources to provide a real-time, all-encompassing, and 360-degree view of the customer.
The Benefits of CRM
Each of the types of CRM presented above has its part to play, and businesses can choose the ones that suit their needs best. Nevertheless, their benefits are more or less the same and are as follows:
Improved Customer Experience – As mentioned before, the primary purpose of a CRM system, regardless of type, is to enhance the customer experience ultimately. They do this by providing the company with a better understanding of the target audience allowing the business to use that information to personalize their messaging and provide their customers with more value than otherwise.
Better Collaboration – CRM systems are also great at increasing both inter and cross-departmental collaboration. Not only will salespeople be able to see their colleagues’ best practices and help each other out when the situation demands it, but managers can also see what their departments are doing in real-time and pick up on any opportunities that may arise.
Informed Decision-Making – As mentioned, a CRM system can provide both an on-the-ground and a high-level picture of rep performance. It, in turn, includes both individual and team conversion rates, deal size, and deal velocity. But this is only one part that CRM can do regarding improving the decision-making process. These systems can also provide a more in-depth look at what elements are working and which need to be developed.
Higher Productivity – Another area where CRM excel is automation. In other words, these systems can handle much of the so-called grunt work such as logging, reporting, creating deals, etc. The increase in efficiency will also translate in more time for your employees to dedicate on tasks that truly deserve their attention.
So, How to Make Your CRM Work in Your Startup?
As a startup using a CRM for the first time, it’s crucial that you get your teams to use it. In other words, the more sales, marketing, and customer service reps you get on board, the more data the CRM will generate, resulting in more accurate information.
It also implies that your teams will use the CRM system effectively. For this to happen, however, you will have to explain the benefits of the system to your staff, so that they don’t look it at it as a burden but an opportunity for efficiency and improvement. One of the best ways of achieving this is by having one of your top salespeople act as an advocate of the system and act as an example of how to successfully use the CRM to their advantage. If they succeed in this, your other staff members will inevitably follow their lead.
Once your teams are comfortable in using their CRM system, the opportunity for better collaboration arises. One reason for this is that the system allows for transparency all the way up the chain of command, meaning that everyone will be held accountable for their actions and blame will not be as easily passed to others in the organization. When everything is out in the open like this, open dialogue and better connections are bound to happen.
Team members can also use it talk and exchange ideas about their contacts, leads, or report any issues to the development team. What’s more, communication via the CRM system will ensure that none of the information will be lost, buried, or forgotten, like is the case with other communication mediums such as email, social, chat, etc.
Another thing to consider when implementing a CRM system is to integrate it with other software. It will significantly save on time by reducing the need to transfer all of the information from one tool to another. Various CRM integrations will make the job much more comfortable by automating many of the tasks that would otherwise need to be performed on external software. To put it simply, the CRM will become a central hub for your accounting, document management, email marketing, customer support, etc., without having to move back and forth between systems constantly.
There are three types of integrations that you can consider:
- Native integrations – which are tools built into the CRM software by the developer
- Third Party Integrations – which are developed by independent vendors
- Custom Integrations – which are created in-house by using APIs (application program interfaces)
In the end, a CRM system is a means by which a company can optimize its processes by automating many tasks. It will also help streamline communications and improve the customer experience. If implemented and used correctly, a CRM will help boost overall productivity and drive sales. For more information on how to successfully start your business and expand your reach online, visit our website today.