CRM systems are essential tools in modern sales, serving as the backbone for managing interactions with prospects and customers. They’re extremely popular and there’s not really any mystery as to why. They work. Plain and simple.
65% of companies start using a CRM system within their first five years of business, while 20% start using it within the first two years! This shows just how much CRM systems are valued by sales companies and why you need to get yours up and running ASAP.
These figures will continue to increase with the ever-growing popularity of CRMs. By centralizing customer data, providing personalized communication, and streamlining day-to-day sales processes, CRMs play a crucial role in building customer relationships and making your business successful.
Before we dive into how they benefit you, let’s address the elephant in the room.
What Exactly is a CRM System?
CRM stands for Customer Relationship Management. CRM systems are a specific type of platform designed for you to easily manage and keep track of your interactions with customers. Put simply, they’re one of the most important sales tools you’ll ever use.
Companies all over the world use CRM systems to store customer information, like contact details and purchase history, all in one centralized location. Using this information, CRMs can assist you in personalizing your sales team’s communications and turbocharging your sales efforts.
Lots of companies use CRM systems because they help build better relationships with customers, increase sales, and save time, not to mention help you with prospecting efforts. Not just that, but using CRMs can get you a whopping 300% increase in lead conversion rate! It’s simple; by having all your customer data in one place, you can get a better understanding of who your customers are, what they want, and how you can provide them with a more personalized service.
Why are CRM Systems Important?
Using a CRM is a bit like having a personalized assistant for managing customer and prospect relationships. It helps your team keep all customer information organized in one place, making it easier for you to understand what each customer needs and how best you can help them.
CRMs also automate monotonous tasks, saving you valuable time to focus on building better relationships with customers, which inevitably leads to more sales and happier clients in the long run.
Benefits of CRM Systems
Retains the Customer
Your CRM helps keep the customers you already have content and coming back for more. What more could you want?
By storing customer data, like what they’ve previously purchased and their preferred method of communication, you can personalize your interactions and make your customers feel seen, heard, and respected. By making them feel valued, rather than just another number, your customers are far more likely to stick around, possibly even spending more in the process.
All in all, using a CRM smartly leads to stronger customer relationships, increased loyalty, and repeat purchases, which are all key to the long-term success of your business. The numbers don’t lie: businesses that leverage CRM systems have seen customer retention rates increase by 27%.
Automates Everyday Tasks
CRM technology saves you time by handling repetitive jobs on your behalf. Things like sending emails and entering data can now be done automatically. Just a few clicks and you’re set to go.
With CRMs you can automatically organize important details from customer interactions with high levels of data accuracy to make your life easier. This removes the need for your team to keep manual spreadsheets and enables them to access the information easily without a physical file. Anywhere, any time, just open your CRM and the data is there.
Your sales reps can save an average of two hours and seven minutes per day by using AI/automation tools for prospect communications. If you run your sales calls from a video conferencing platform, it’s worth signing up to tl;dv to get AI notes and timestamps synced automatically to your CRM too.
Centralized Data
CRM systems act like a central hub where all your customer information lives, making it the go-to place for accurate details about customers. Instead of trawling through different files and trying to match A to B, look at your CRM for the most up-to-date and reliable data.
Businesses all over the world centralize their data: over three-quarters of companies (78%) use centralized data as part of their customer data strategy. The benefits, among others, include greater efficiency (64%) and more business growth (57%).
The main drawback to centralized data is that there is a security risk of having all your company’s data in one central location. A single exploit could leak all your customer’s data at once. This isn’t unusual, especially in the tech world. Practically every big tech company you can imagine has been hacked at some point or another with billions of customers’ data being leaked or sold on the black market.
To prevent this, make sure you choose a CRM with reliable and robust security measures.
Accurately Forecast Sales
CRMs help you predict future sales more accurately by keeping tabs on past sales data and your current customer communications. Your CRM can analyze this information and identify patterns and trends, which leads you to make informed predictions about future sales. This then helps you to plan and budget more effectively.
In fact, it’s thought that CRM software increases sales forecasting accuracy by 42%.
Integrations
CRM systems tend to work seamlessly with other apps, integrating with calendars, marketing platforms, email tracking, and more to funnel your data from external sources directly to your CRM of choice. This empowers you to work more efficiently as all your apps become interconnected. By integrating your CRM with other software, the need to navigate multiple applications is eliminated.
Most CRMs have native integrations with video conferencing tools too. Salesforce, for example, integrates with call recorders in a few simple clicks.
A great example of how you can leverage integrations is found in the way the CEO of Container One combines Method and Quickbooks. With the use of a CRM platform, plus the accounting integration, Container One doubled revenue in the past three years. The CEO, Glen Taylor, claims, “Without Method, it would have been nearly impossible.”
Check out his testimonial for yourself to see the power of integrations.
How Do CRM Systems Improve Lead Management?
CRM systems have an array of lead management tools that make it easier to organize lead information in one place. This helps you keep track of leads and ensure you’re following up in a timely and efficient manner. CRMs automate tasks like lead assignment and send your team follow-up reminders, ensuring that no leads slip through the net.
CRMs enable your team to focus on the right leads at the right time, with lead scoring and prioritizing prospects. This then enhances the chances of converting prospects into customers. The CRM lead management market was valued at 1.75 Billion USD in 2023 and is projected to reach 4.28 Billion USD by 2030. Seeing how much the market value has increased in such a short time highlights the ever-growing need for lead management tools.
With lead generation and the prioritization of prospects, a CRM platform can turbocharge your marketing campaigns. For instance, CRMs can help split your target audience up, create a tailored email chain, and then automate the sendings at a specific time to give you full control over your leads.
Check out the Salesforce video below if you want further information on how CRM systems help improve lead management!
How Do CRM Systems Enhance Sales Forecasting?
CRM systems enhance sales forecasting by analyzing past sales data and current market trends to help you predict future sales on a more accurate basis. CRMs provide valuable insights into the health of a sales pipeline and the potential revenue coming your way. This helps you anticipate any problems and enables you to set more realistic sales targets.
The software collects data from various sources, another reason why integrations are crucial. The more sources of customer data you can connect to your CRM, the more accurate its sales forecasting will be. This data, like previous purchases, likes, shares, and items added to the basket, can all be used by your CRM to generate detailed sales forecasts. These forecasts are created using advanced analytics techniques and machine learning algorithms which predict which sales are near closing and which ones need nurturing along.
With accurate forecasts come accurate allocations of resources, helping you optimize sales strategies and plan for growth.
How Do CRM Systems Maximize Customer Relations?
CRM systems maximize customer relations by facilitating efficient communication. When your sales reps or customer support team has all the customer data under one roof, they can quickly and easily check up on who the customer is, what they like, what they dislike, how much they’ve used the product, if they’ve ever complained before, what they say about you on social media, and much more. It’s all in one place.
Your colleagues can scan over this information before contacting them, ensuring they’re up to date and are able to treat the customer like an old friend. It allows you to engage in a more meaningful manner.
Ikea’s whole CRM strategy is built on developing a deeper understanding of its customer base. They’ve extensively researched different customer profiles, behaviors, and preferences, and tailored their products and marketing efforts to their target group.
Furthermore Urban Ladder, India’s leading online furniture retailer, introduced Salesforce to its operations and now has the capability and data to deliver on its customer-centric vision. The agents are empowered with details about their customers’ past interactions and preferences so they can provide a more personalized and proactive service.
Additionally, CRM systems automate routine tasks, such as follow-up emails and reminders, ensuring your team communicates consistently with customers. The chart below is a great example of how significant the impact of CRM systems is when it comes to customer relations.
So, are CRM Platforms Perfect?
Not quite. CRM platforms offer countless benefits but they do have their drawbacks. Technologically, CRM systems are complex and can be costly to implement, without mentioning the training required to get your team up to scratch. Although a CRM system is just software, if it’s not utilized correctly it can lead to problems that hinder the effectiveness of your entire system.
Let’s take a look at the specific limitations CRMs have.
The Limitations of CRM Systems
Implementation Cost
Implementing a CRM system can be costly due to expenses associated with software, hardware, implementation costs, maintenance, upgrades, and staff training.
Technologically Reliant
Balancing technology with human interaction is crucial; over-relying on a CRM system can erode the personal and empathetic touch, putting customer satisfaction and relationships at risk.
Complex
CRM implementation can pose challenges, especially for small businesses with minimal IT resources. They are usually highly customizable with dozens of in-depth features, dashboards, templates, and more. It could take years to learn everything, but you can also get overwhelmed when trying to find only the specific things you need.
How To Use a CRM Efficiently
Filling in CRMs correctly is a must if you want to feel the benefits of a fully operating CRM system. Accurate data ensures the CRM serves as a reliable repository for all customer information, enabling your sales team to make informed decisions and personalize their interactions with prospects.
Everything needs to be recorded. Whether it’s updated contact details, recording communications, or noting specific customer preferences; they all add up for a better understanding of your customer’s journey.
Inaccurate or incomplete data can lead to missed opportunities, wasted resources, and, ultimately, a less effective CRM system. Some sales reps don’t fill in the data correctly. Reasons vary, but laziness is perhaps the biggest one. At times though, individuals sabotage the data on purpose to avoid their lead being stolen by other reps. So much for teamwork!
Forbes found that a lot of sales reps actually hate CRMs. The main reason was that inputting the data into a CRM takes actual time away from selling, not to mention lots of sales reps are old school and like to keep hard copies. For you to make the most of your CRM, you’ll have to convince them to embrace the benefits.
Let’s take a look at things to consider when inputting data into your CRM.
Ethics
Ethics play a crucial part in inputting data. Correctly filling CRMs revolves around respecting customer privacy, obtaining consent, and being transparent about data usage. It’s so important your team upholds honesty and integrity when managing customer information.
Ensure your team is aware that prospects can retrieve data via the Freedom Of Information Act whenever they want. This means they are legally entitled to view any data you have on them, making it critical that your team remain respectful when adding comments to the CRM because you never know when it could happen.
It’s happened before, and if your team isn’t careful, it can leave you feeling red-faced. That’s not even mentioning the tarnish it could have on your company.
Professionalism
Similar to the previous point concerning ethics, remaining professional is crucial as the data you input reflects on you, your organization’s integrity, and the reliability of your entire CRM system. Professionalism entails regular and accurate recording of information without bias or subjective interpretations. It ensures the data inputted is consistent and coherent.
Through a real life case study, one organization discovered they only had 32 thousand records instead of the supposed 70,000. They brought proof to the sales and marketing team who straight up denied the statistics of the report, but it was too late. They were caught red-handed in the act of inflating numbers to falsify their results. Bloated CRM data, whether on purpose or due to carelessness, is a fast-track to nightmareville.
Automate the Process
The key to maximizing efficiency with CRMs is to automate repetitive tasks. Start by identifying them: data entry, follow-ups, etc. Once you have them, you can utilize CRM automation features to do the day-to-day duties for you. Sales automation can result in higher customer satisfaction and up to a 5% uplift in revenue!
Which CRM Should You Use?
Choosing the right CRM depends on what your business needs. For instance, Hubspot CRM is good for email and marketing integrations, whereas Salesforce is a great platform for bigger companies due to its customizability! Zoho on the other hand is the most affordable and easiest to use.
Each CRM has its perks; let’s take a closer look at six of the best:
- Salesforce.
Salesforce is favored by sales teams for its customizable features and a comprehensive arsenal of lead management, tracking, and pipeline forecasting tools. It’s a great tool for bigger companies, but it’s one of the more complex and expensive CRM’s on the market. - Hubspot.
Hubspot is praised for its user-friendly interface and abundance of integration tools, whilst also offering valuable customer insights and intuitive lead management. However, pricing may be challenging for smaller enterprises. - Zoho.
Zoho CRM is great for sales teams because it’s easy to use and budget-friendly! Zoho provides lots of automation tools and easily customizable features whilst integrating well with other apps. It’s reported to be not as advanced as other CRMs though. - Pipedrive.
Pipedrive is a straightforward CRM that offers pipeline management tools and has a helpful sales assistant for personalized recommendations. It integrates seamlessly with call recorders like tl;dv to funnel insights from sales calls straight to your CRM. One drawback is that it’s reported to be a bit too limited for some customers compared to the alternatives. - Zendesk Sell.
Zendesk provides an array of tools for collaborating, managing leads and tracking deals. Zendesk has uniquely built-in communication tools with messaging and live chat, but it’s a costly piece of kit. - Insightly.
Insightly is praised for its easy-to-use application and project management tools, like pipeline management and task automation. It is, however, limited when it comes to creating sales reports.
Get Your CRM Up and Running
Think of a CRM as your personal little customer relations assistant. It helps you remember who you’ve talked to, what they’re interested in, and when you need to follow up. They save you time on tedious data entry which you can put to good use building better customer relationships.
Keep your CRM organized, update it regularly, and don’t neglect it and you won’t have any issues. Have faith; it’ll make your work life a whole lot easier!
