CRMs are a revolutionary tool for businesses across all industries. Instead of juggling information between spreadsheets or different platforms, a CRM serves as a single source of truth for your sales, marketing and customer service operations.
There are three major types of CRMs, each of which serves a different core purpose. We give detailed CRM software examples and explain the benefits of each so that you can make a more informed decision when choosing one for your business.
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What Is CRM?
CRM is an acronym that stands for “customer relationship management.” In other words, how your business nurtures relationships with both existing and prospective customers to increase loyalty, trust and profitability. CRM is often used as shorthand for or interchangeably with “CRM software,” which plays into your overall customer relationship management strategy in three main ways: helping you organize operations, improving sales and conversion rates and making collaboration easier across teams.
12 Ways a CRM Software Can Benefit Your Business
CRM software brings a multitude of benefits for your business, the most important ones being:
- Centralizing data across your organization. A CRM stores critical information about your sales pipeline, customer relationships and team member performance, and then makes it easily accessible. This is vitally important as it prevents information from getting lost or dispersed amongst different platforms.
- Organizing data. Not only does a CRM centralize data, it also organizes it. You can easily search for and find customer information as well as data on business performance.
- Saving time and increasing productivity. With your data both centralized and organized, your team will spend less time chasing the answers they’re looking for, thus boosting your organization’s productivity and efficiency.
- Making better customer service possible. Your customer service team can see each customer’s history of interactions with your company, what products or services they’ve purchased from you and more. Having this information at the ready helps boost customer satisfaction since your team will be able to provide a higher level of service.
- Improving customer segmentation. A huge list of contacts can be overwhelming, but a CRM will help you organize your list based on whatever criteria you’ve set. That way, your team can prioritize tasks and send out more targeted communications.
- Facilitating easier internal communications. CRMs make communicating across teams simpler. Your team members can tag each other in various tasks and updates within the system so that everyone stays updated on what’s going on internally.
- Automating reports. A CRM can generate certain sales reports for your team automatically, thus giving a faster and more accurate window into performance.
- Providing more accurate business forecasting. CRMs can help you interpret your data so you can more accurately forecast future performance.
- Managing prospective customer relations. Follow-ups are a critical part of your sales cycle. A CRM can notify you when it’s time to schedule a call or send an email to a prospective customer so that you’re more likely to reach or exceed targets.
- Increasing sales. Your sales are likely to increase thanks to all the insights and organizational benefits a CRM provides. More time and data can help your team sell smarter.
- Increasing customer retention. Your existing customers reap the benefits of a CRM as well. Through better ticket management, sentiment analysis and faster communication, your retention rates are also likely to improve after implementing a CRM.
- Allowing your operations to scale more easily. By centralizing your information and making communications much more straightforward, your team can expand without as many logistical hurdles and headaches. A CRM can grow as your business does.
Operational CRM
Operational CRMs serve as a database for storing and updating prospect and customer information. This information is then made accessible to your marketing, sales and customer success teams.
Designed to be a hub for information on all customer relationships, operational CRMs can help you determine where each of your contacts is located in the sales process, how many times they reached out to sales or support and which marketing emails they received.
Examples of popular operational CRMs include Salesforce, Insightly and Pipedrive.
Examples of How a CRM Can Organize Operations
An organizational CRM can organize your operations in the following ways:
- Managing your contacts. Your CRM will keep track of all customer and prospect email addresses, phone numbers, mailing addresses and more, so you can easily search for and find contact information in one place.
- Automating your marketing campaigns and efforts. You can use your CRM to automate certain marketing tasks, like follow-up emails.
- Scoring your leads. A CRM will let you assign a score to each lead that comes down your pipeline so that your sales team can prioritize accordingly.
- Managing your customer support tickets. A CRM can be vital to your support organization by tracking incoming support requests and storing records of what happened during each support interaction.
Sales/Analytical CRM
An analytical CRM can analyze the data entered into it to draw valuable insights about your business. You can then use these insights to make smarter business decisions.
Analytical CRMs come equipped with a special type of database called a data warehouse that allows data to be easily prepped for trend analysis and visualization. The software also includes data mining modules and OLAP (online analytical processing) technology, which helps make forecasting, charts, graphs and reports possible.
Examples of analytical CRMs include HubSpot, Zendesk and Zoho.
Examples of How a CRM Can Improve Sales/Conversions.
Analytical CRMs can help improve your conversion rate by giving you insights surrounding:
- Sales performance. See how much revenue you’ve generated over a specific period of time as well as which team members are your top sellers. Use this information to forecast future quarters and reshuffle your organization to make sure your best employees are placed appropriately.
- Sales opportunities. Spot who your customers are and where they’re coming from to identify where you should be focusing your targeting efforts.
- Marketing. Determine which of your marketing campaigns were most successful and why.
- Customer service. Examine your brand’s health by checking your sentiment analysis and see how quickly (or slowly) your CX team responds to open tickets.
- Channels. You probably use a number of different channels to talk to customers, e.g., email, live chat, phone calls and social media. Channel analysis can help you pinpoint where most of your customer interactions are taking place.
Collaborative CRM
Collaborative CRMs make it easier to share data and information internally. Not only does your team benefit from easier communication, but your customers ultimately receive a better experience too.
Popular collaborative CRMs include Microsoft Dynamics 365, Sage CRM and SugarCRM.
Examples of How a CRM Can Make Collaboration Easier
A collaborative CRM fosters teamwork within your organization by:
- Making all customer interaction information accessible. Customer-facing teams can see detailed records of all customer interactions. Armed with the full picture, teams can deliver better service to each customer.
- Helping your team delegate tasks appropriately. Your team can assign tasks to the appropriate person within the CRM.
- Managing your channels. Keep track of all of your inbound communications through your CRM so that you don’t miss a message.
Best CRM Integrations
Setting up an important tool like CRM can be a significant undertaking. Integrations help make the process of getting started much easier. The best CRM software can integrate with other tools you might already be using for your business. Look for the following integrations when choosing any type of CRM software to make your workflow even more streamlined.
- Email: get quick access to your best email templates and contact data right from your inbox.
- Calendar: sync your calendar to send meeting invitations and easily log meeting notes into your CRM.
- Social media: connect your social media platforms to track mentions and tags and schedule posts across channels.
- Form and data collection: syncs data captured via forms or surveys right into your CRM.
- Phone and video calls: link your phone or video call tools to keep meticulous records of each conversation.
- Live chat: capture leads more easily by connecting your live chat software directly to your CRM.
- Document signing: send proposals, receive signed documents from clients and keep records of who signed what and when.
- E-commerce: easily see which customers bought which products and send invoices directly.
- Events and webinars: capture data on who bought tickets to or attended your events in order to create powerful follow-up campaigns.
Frequently Asked Questions (FAQs)
How much does a CRM system cost?
CRM software varies widely in price due to the number of leads you plan to store, the features you need and how many people in your organization need unique logins. CRMs can go for as little as $12 per month to as high as $3,200 depending on your needs. Some providers also offer free plans with limited features.
Should I buy a CRM system or design a custom one?
It depends. There are pros and cons to buying an existing CRM versus designing your own. Going with an existing CRM may mean you forgo having the best possible workflow for your business, but designing a custom CRM can be costly and requires significant development work. If you cannot find an existing solution that would work for what you need, a custom version may be a suitable option.
What’s the difference between cloud-based CRMs and on-premise CRMs?
Cloud-based CRMs store information in the cloud, which means you can log in and access your data from anywhere with an internet connection. On-premise CRMs store data locally, meaning you need to be in a specific place or on a particular device in order to use the platform.
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