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The word CRM is derived from the French “compte” meaning account. It’s no surprise that a lot of people in the business world are using Customer Relationship Managers to track their customer interactions and improve sales performance. These tools have been proven time and time again to be advantageous for companies, but what about your individual customers? Is it worth investing in one as well?
A CRM is a software tool that helps businesses manage their customer relationships, contacts and interactions. A CRM can be used to track the progress of a sales process, manage contacts and leads, automate business processes like lead nurturing or account management, and more. Read more in detail here: how much does crm cost.
Customer relationship management (CRM) software helps sales and customer service departments better data organization, communication, cooperation, and efficiency. The time your organization spends manually executing activities that might be automated, creating reports, nurturing leads, repeating information, and looking for customer data, all of which results in a financial expense, is the hidden cost of not having a CRM.
The following are the top six reasons for using a CRM system, which address the ultimate question: Why use a CRM system?
1. Better Data Management
CRM software functions as a large-scale information system that stores and organizes both identifying (such as a lead’s contact information) and descriptive data (such as a lead’s job title and industry). In fact, according to a CRM trend analysis, contact management is the most-requested function in a CRM, followed by the ability to monitor interactions with those contacts with 88 percent.
Your company can effortlessly search for different leads or account records by storing and arranging contact information. For example, Zoho CRM has a search bar in its CRM system that allows users to look for data.
Record search bar in Zoho CRM (Photo courtesy of Zoho)
CRM systems analyze data via built-in data analytics and reporting capabilities, in addition to organizing customer and prospect data. This provides valuable information to your company, such as typical consumer purchasing patterns, which goods sell best (or poorly), places where your sales process may be improved, and even sales income forecasts.
Data is interpreted and presented to you and your team in reports or on your CRM dashboard. The Salesforce Einstein analytics tool, for example, analyzes data based on a variety of indicators, such as opportunities won by stage or product line, and then reports it on the CRM’s sales performance dashboard. This data may be used to enhance management choices, identify process improvements, teach sales agents, and define objectives for your company.
Einstein is a Salesforce analytics product (Source: Software Testing Help)
The Cost of Not Using a CRM for Data Organization
The confusion that results from not employing a CRM to manage data is the price to pay. Finding vital information becomes more difficult and time-consuming when your data is dispersed over various, less sophisticated storage channels such as spreadsheets or even paper files. It also makes it difficult for your company to comprehend data quickly and effectively since data is decentralized and may involve lengthy manual entry, computations, and report compilation.
2. Customer communication that is more efficient
The majority of CRM software includes features for connecting with customers and managing customer care. One of the best answers to the question “Why use a CRM?” is that it can improve your customer retention rate by as much as 27 percent. With the main goal of retaining customers through high-quality service and an enhanced customer experience, one of the best answers to the question “Why use a CRM?” is that it can improve your customer retention rate by as much as 27 percent.
A CRM allows your company to manage customer support and engagement more effectively and efficiently for both outgoing and inbound client interactions. Built-in tools or third-party integrations like email, phone, live chat, and even social media channels are used to do this.
To post content and engage with customers, CRMs like Zoho CRM link with social networking networks like Twitter, Facebook, and LinkedIn. Users may also keep an eye on brand mentions on social media and respond to comments. Because social listening is currently the number one method employed by professional marketers, these monitoring tools are critical.
Zoho has a Twitter website where you may post your tweets (Source: Zoho)
Monitoring social media using Zoho (Source: Zoho)
Sending frequent email newsletters to consumers is another approach to interact with them. Email newsletter templates, design tools, and deployment capability are all built-in to certain CRMs, such as HubSpot. Your firm may send corporate updates to your customers highlighting staff changes, product or service upgrades, or company milestones, in addition to general audience interest subjects and promotions.
HubSpot has a tool for creating newsletters (Source: HubSpot)
When it comes to managing service operations, having a centralized system for processing requests that also enables consumers to communicate through numerous channels is critical. According to surveys, 66 percent of consumers prefer to address difficulties over the phone, 49 percent prefer to resolve issues through email, 28 percent prefer to resolve issues using online forms, and 28 percent prefer to fix issues via live messaging.
Many CRM solutions, fortunately, have built-in service ticket management tools that make managing client requests across all channels much simpler. Bitrix24, for example, receives incoming customer requests using a queue-based ticketing system. After that, service personnel decide which consumers to help next and via which communication channel.
Customer service at Bitrix24 contact center (Image courtesy of Bitrix24)
The Cost of Not Using a Customer Relationship Management System
The penalty of not employing a CRM system to connect customers and handle customer care is longer communication and bad customer service, which leads to consumers leaving brands. A centralized CRM system that gives access to numerous communication channels, the case management queue, and service ticket management tools helps avert these outcomes.
Without a CRM, it’s more difficult to provide information and give help to consumers, making them feel unloved and less willing to do business with you again, lowering customer retention and raising churn. The overall hidden cost of consumers feeling ignored is estimated to be $75 billion across all businesses in the United States.
3. Follow-up on Leads that is Automated
A CRM may assist your company in not just communicating with existing customers, but also in engaging future consumers and leads at every step of the purchase process. To assist you create and strengthen connections with potential customers, most CRMs provide robust lead nurturing capabilities, such as drip email campaigns and power call dialing tools. Find out more about the finest email marketing CRMs.
A drip campaign is sending automatic emails to leads depending on information about the lead, which might include online actions like clicking a link, filling out a form, or visiting a certain web page. This email technique employs audience segmentation, which improves campaign performance. In fact, audience segmentation is used by 30% of marketers to enhance email engagement rates.
If a prospect navigates your website and clicks on a given page numerous times (or even just once), your CRM may send that lead one or a series of emails depending on that activity. These emails are intended to encourage them to take the next step in the purchasing process, such as scheduling a demo or a sales presentation.
Drip campaign emails are more tailored since they are sent in response to a lead-specific trigger. Pipedrive, for example, lets users establish an action (such as a lead getting emails automatically as a subscriber) in response to a certain trigger (such as someone becoming a lead after sending the business an email).
Setup of Pipedrive drip email automation (Source: Pipedrive)
Direct calling is a conventional approach of nurturing leads. Direct calling may be used by sales representatives to check in with leads regardless of where they are in the sales funnel. Reps can remind leads of your company and determine if it’s the ideal moment for them to buy from you, schedule a demo or sales presentation, or whether additional lead nurturing is required.
Power dialer features are available in several CRMs. These tools compile a list of lead contacts sorted in the order desired by a sales representative, which can then be used to make a large number of outbound calls using click-to-call (and sometimes auto-dialing). For sales teams, look at the finest CRMs with call center functionality.
Power dialing technologies may increase the number of calls made in a given length of time by 5 times that of traditional dialing. Freshdesk Contact Center may do this by storing hundreds of contacts in a queue that can be dialed with a single tap.
Power dialer for Freshdesk contact centers (Source: Freshworks)
Leads don’t have to be prospective customers; they might also be potential partners, suppliers, or job applicants who need to be nurtured. Recruiting firms and staffing agencies, for example, can use Zoho’s native Zoho Recruit software to organize and manage job candidate leads as a CRM.
Dashboard for Zoho Recruit (Source: Zoho)
The Cost of Failure to Use a CRM to Automate Follow-up
Because of the time spent completing menial chores, not utilizing a CRM to interact with prospects results in lesser engagement and fewer conversions. Because leads aren’t moving through the sales funnel as rapidly as they should be, fewer conversions result in lost income.
If you don’t use automatic drip campaigns based on purchasing signals, for example, you’ll have to manually monitor behavioral triggers and send lead nurturing emails one by one. When prospecting for leads over the phone, your salespeople will waste a lot of time manually searching contacts and performing outbound calls. This hinders the flow of leads and prospects through the sales funnel and into concluded deals.
4. Sales Process Management That Is More Efficient
A customer relationship management system (CRM) is a fantastic tool for visualizing and controlling your sales process. After you’ve entered leads and prospects into your CRM, you’ll be able to see where they are in the sales funnel. These capabilities may help your sales team track and maintain progress, as well as choose which leads to concentrate on depending on the possibility of a transaction closing.
CRMs employ the Kanban-style graphical structure to monitor the sales funnel. Each lead is shown in a box that can be dragged and dropped between sales process stages, making it simple to see where the lead is in the sales process or to shift them to a new step. Salesforce is a great example of a Kanban visual style sales pipeline visualization.
Kanban sales pipeline on Salesforce (Image courtesy of Prolocity)
Lead scoring is a strategy for identifying the best leads and prospects using a score as part of the sales process. This score may be used to determine whether leads are ready to convert or are the most likely to do so. Your CRM may even be set up to automatically update lead ratings depending on events like emails being read, website pages being visited, or previous interactions with the lead.
Zoho is at the lead in terms of scoring (Source: Zoho)
The Hidden Cost of Sales Management Without a CRM
The ultimate penalty of failing to use a CRM to manage the sales process is income wasted. Your sales teams won’t be able to simply prioritize their next sales responsibilities if they don’t monitor where each lead is in the funnel or score them.
Furthermore, without CRM sales management solutions, your company won’t be able to automate and customize lead nurturing processes that take prospects to the next step of the sales process. This means you’re wasting time nurturing leads who aren’t likely to buy from you, and you’re missing out on money by failing to convert leads who would have bought from you if nurtured correctly.
5. Improved collaboration within the team
A CRM is an internal communication platform that allows teams to communicate with one another, track agent progress, and keep team members responsible. CRMs may also help manage team projects and tasks using third-party connectors or, in some instances, a built-in project management system, such as Bitrix24.
Bitrix24 is a project management software (Source: Bitrix24)
Within a CRM, communication between team members may be accomplished through built-in features or by connecting with popular instant messaging applications like Slack. Pipedrive takes Slack integration to the next level, not only enabling teams to talk on Slack from inside the Pipedrive system, but also providing automatic updates through its deal bot to alert users of overdue deal-related duties.
Integration of Slack and Pipedrive with a deal bot (Source: Medium.com)
One of the best practices for utilizing a CRM system is to use connectors with popular communication and productivity applications. Check out our post on CRM best practices for small organizations for additional information on how to improve your CRM experience.
Using your CRM’s lead assignment features is one approach to keep sales reps responsible. Based on triggers like lead source, prospective transaction size, geography, industry, and more, this automates lead assignment to certain team members. Lead assignment is a crucial phase in the lead tracking process. Check out our post on how to manage and monitor leads in seven easy stages for additional information.
Lead assignment not only guarantees that the top representatives are managing opportunities inside their wheelhouse for a higher chance of completing the transaction, but it also enables teams to keep each other responsible. It also pushes sales people to follow up with leads promptly, which might be the difference between gaining and losing business, given that 50% of sales go to the vendor that answers first.
The development of a lead assignment trigger in HubSpot (Source: HubSpot)
The Cost of Failure to Use a CRM for Team Collaboration
Unfinished work, lost sales opportunities, and maybe a corporate culture that does not hold people responsible are all costs of not utilizing a CRM to enhance team cooperation. Using integrated collaboration platforms like Slack in combination with your CRM system, a CRM makes it simpler for your team to work together.
6. Increased Productivity in General
Each of the aforementioned benefits for investing in a CRM originates from the reality that CRM software boosts productivity and boosts corporate profitability in each of these areas. Instead of manually analyzing data, sending emails, or visualizing the sales funnel, CRM workflow automation can handle it for you using built-in capabilities or workflow automation software connections.
Wells Fargo, which had fantastic returns after investing in a CRM system, is a success tale of how a CRM helped enhance productivity. Their developers’ productivity rose by 20%, and approximately 5,600,000 hours of additional labor were saved as a consequence of the investment.
You may use your CRM system to construct online web forms, or you can use a third-party platform (such as Mailchimp) to gather data and input it straight into your CRM. Lead information such as name, organization, phone number, email address, interests, and expected purchase date is collected through online forms and instantly uploaded to the CRM database.
This frees up time for sales professionals to concentrate on selling and prospecting rather than manually inputting information. Zoho CRM even blends lead assignment automation with record entry automation from web forms. When someone fills out an online form you generated in Zoho, a new record is produced in the CRM, and the lead is allocated to a sales agent immediately, saving your team time.
Zoho may then utilize workflow rules to add the lead to a drip campaign automatically. Based on emails read, links clicked, and forms completed, accurate lead scores may be provided. All of this may be done automatically thanks to workflow rule triggers, which gives you a higher chance of completing the deal.
Zoho’s online web form builder (Source: Zoho)
Marketing automation also boosts productivity by helping users to skip time-consuming procedures such as copying and pasting emails for bulk distribution. CRMs like HubSpot feature an easy-to-use interface for generating drip email campaigns that automate marketing activities. Drip campaigns send out purchasing signals and remind sales people to follow up with leads, resulting in more sales-ready prospects at the bottom of the sales funnel and greater conversions.
Page for HubSpot marketing automation (Source: HubSpot)
The usage of artificial intelligence (AI) to increase productivity is one of today’s most visible CRM trends. HubSpot enables organizations to incorporate a CRM-connected AI chatbot on their website that will automatically respond to queries submitted by site visitors. This functionality frees up your customer care staff to handle more difficult issues by addressing simple or frequently asked queries through chatbot.
On the HubSpot website, there is an AI chatbot (Source: HubSpot)
CRMs also leverage AI to automate sales coaching, which is normally done by a manager, by automatically providing sales people with information about their sales actions and pipeline. Pipedrive does this through their AI Sales Assistant tool, which sends real-time messaging to sales professionals, offering trends and advice to help them improve their sales success.
AI is becoming the productivity equal of one or more people because to its CRM skills. Artificial intelligence has the potential to boost operational efficiency by over 40% and overall firm profitability by an average of 38%.
Coach insights from Pipedrive AI Sales Assistant (Source: Pipedrive)
The Uncoverable Cost of Not Using a CRM to Boost Productivity
Lost time, income, and the inability to compete are all costs of not utilizing a CRM to boost productivity. Your firm will take longer to complete sales cycles if you don’t have a system in place to automate activities. Furthermore, without CRM AI capabilities, your company risks slipping behind rivals that invest in AI for improved insights and service automation.
Conclusion
Lost time, lost money, and a less productive staff are all examples of the business consequences of not employing a CRM. CRMs have a high return on investment (ROI), and their growth rate is always increasing. According to Nucleus Research, a CRM’s ROI in 2011 was $8.71 for every dollar invested. Today, the ROI for firms utilizing a CRM is over $30 for every dollar spent.
CRM software is a tool that businesses use to manage their customer relationships. They are used for the management of sales, marketing, and support. A CRM is a powerful tool that can help you save time and money. However, there’s also an “unseen” cost associated with not using one. Reference: crm pricing comparison.
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