Customer Relationship Management: A Complete Guide
In this guide, you’ll get a comprehensive overview of what CRM stands for, and how it’s used in sales, marketing, and customer support. We’ll answer all of your questions, and explain in simple language how this software tool can make your customers happier — while also boosting sales and productivity.
Feel free to skip around by clicking through the table of contents below:
- What does CRM stand for?
- What is CRM?
- What are the features of a CRM?
- What are the benefits of customer relationship management?
- What are some CRM examples?
- What is CRM in sales & marketing?
- What is CRM in customer service?
- How do you create a successful CRM strategy?
- How do you know your CRM system is effective?
- Try CRM for free
What does CRM stand for?
CRM stands for Customer Relationship Management. It’s an acronym you may see before words like “software,” “platform,” or “solution.”
But a simple CRM definition doesn’t explain the whole picture.
Customer relationship management technology allows you to develop and nurture meaningful customer relationships. This tool streamlines the way you track and utilize customer information. It serves as the source of truth for your business, capturing all interactions across sales, support, and marketing. And centralizing all that in one place. The benefits, of course, are that everyone is on the same page with a single view of the customer and visibility into their journey and the sales pipeline.
Nowadays, not even the most organized team can keep track of all the data that builds up during a customer’s experience with your organization. And if the ball is dropped at any point along the customer lifecycle, the customer can easily drop you.
That’s why a cohesive CRM system is so important for customer-obsessed businesses. By gathering, storing, and analyzing important customer metrics such as purchase history, behavior patterns, and personal preferences, your agents gain a deeper understanding of what makes your customers tick.
Personalized, relevant, on-topic communication makes for satisfied customers. And satisfied customers are good for business.
What Is CRM?
At its most basic, CRM software acts as a contact management application. You can learn more about contact management software here. It’s a platform on which to store phone numbers, emails, social media handles, addresses, purchasing history, and even preferred methods of communication. Using all of this data, customer relationship management technology then prioritizes your leads, automatically setting you up to engage with the prospects who are most likely to bite.
Even when a touchpoint doesn’t lead to a sale, the software records every interaction across a range of channels. This frees up your reps from manual data entry and gives them lots of useful content that can be used to personalize future messaging.
It also comes with a host of automation possibilities, getting rid of much of the repetitive grunt work involved in marketing, sales, and customer support, and saving your team valuable time.
CRM systems filter all of these tasks and data through a centralized dashboard. With everything available in one place, departments can easily view and share up-to-date information. Dashboards can also be customized and integrated with other business and sales apps to suit your organization’s unique needs.
Ultimately, the goal of customer relationship management systems is to attract new customers and keep the ones you have happy. It’s a system of building and maintaining trust with the people who keep your business running and growing. And as an added bonus? It lets your agents ditch tedious and time-wasting tasks. Happiness all around.
What are the features of CRM?
If you think of it as a brain covering the entire customer journey, its features are the different neural pathways that all connect and lead back to a central processing center. Some pathways help with workflow automation, others with reporting and analytics, others with call center solutions. Whatever your needs, its features allow individual departments to handle those highly specialized tasks with insight.
Let’s look at a few.
- Lead nurturing from lead management software lets sales reps cultivate and grow positive customer relationships through every stage of the sales funnel.
- Analytics help your team figure out what customers are interested in, how to contact them, and when they need a personalized nudge.
- Sales forecasting allows agents to view past sales data, identify impactful trends, and compare industry standards in order to make better predictions.
- Performance metrics from sales trackers let you know if you’re on track to reach your goals — or if your pipeline needs tweaking.
- Some platforms even offer some lead generation software functionality, helping you increase demand generation.
A key element of a customer relationship management system is that it is highly customizable. Your company can add the features that are most useful for your sales process, and forgo the ones your particular organization has no use for.
Here’s a quick glance at some of the useful features you may choose to include in your CRM system:
- Email tracking & notifications
- Click to call auto dialer
- Ticketing system
- Messaging & live chat
- Reporting & analytics
- Pipeline management
- Data import/export
- Self-service portal
- Social media integration
- Prospecting tools
Benefits of customer relationship management
CRM features add up to major benefits for you and your team. Sales, marketing, customer support, and project management can save time, stay organized, and access deeper sales insights when using it.
Here’s what integrating customer relationship management can do for your business.
Stay organized — finally
No more jumbled spreadsheets or relying on the limits of human memory. Seeing customer data organized in one place gives you a superior view of how business is going, allowing you to detect patterns and catch bottlenecking in the pipeline.
Set goals and track their progress
Set high-level goals with easily implemented analytical tools. Track agent progress, and stay informed the moment anyone falls behind or goes off course. Having the big picture at hand lets you see who’s handling what and where your efforts are most needed in keeping everyone on track to hit quarterly targets.
Personalize customer interactions
Customers know you have a product to sell, but that doesn’t mean they want to feel like just any buyer. A CRM gives you the tools to gather personal information for crafting messages that are most likely to resonate with your target customers. When customers feel seen as individuals with unique needs, they’re more likely to become — and stay — loyal for the long term.
Target your customer base
When you’re able to view all the data from your existing customer base, you begin to notice patterns. Understanding who’s buying from you allows you to seek out similar prospects, reducing the effort you’d otherwise spend on throwing out a wide, generalized net.
Keep the customers you’ve got (and keep them happier)
If a customer keeps coming back, it’s important to know why. Once you identify the aspects of your organization that keep customers returning to your door, you can build on your success to keep more customers happy, more of the time. And when a buyer knows that their experience with your product or service is just as important to you as the money they spent on it, they’ll provide something a CRM can’t: word of mouth.
Drive business growth
With no more panic about losing customers between the cracks, you’ll feel confident about scaling your business. Increasing rates of customer retention means you can plan for expansion, with less fear that your bottom line will suffer as you introduce new products or services.
Increase collaboration between teams
When everyone is on the same page using the up-to-date information from your sales dashboard, teams can easily collaborate. Marketers and salespeople use the same data to craft consistent messaging, so no one is confused about who is making what promises.
Up-selling is easier when you know who your customers are and what they want. Like a bartender who knows what the regulars like to order, marketing and sales can be strategic about when and how they jump into action, rather than throwing everything at the wall and hoping something sticks. Your sales teams are also able to spend more time actually making sales, instead of on repetitive tasks like data entry.
What are some CRM examples?
A CRM is like a good restaurant server — the diners barely notice them, and yet the water glass is always filled.
Though this may be your first time digging into the nitty-gritty of CRM definitions, the fact is you’ve likely been engaging with it for as long as you’ve been a consumer.
Smartphone users, for instance, are constantly providing an influx of useful information about their consumer habits when they use applications, plug their questions into search engines, and make purchases. All of this data is scooped up to personalize service and target marketing. Advertisers on social media apps aren’t psychic — they simply use customer relationship management to know what their customers are most likely to be interested in.
And it isn’t just tech companies using CRM to get personal with their customers. Almost every retail chain nowadays uses it to offer promotions, track customer loyalty cards and points, handle customer satisfaction issues, and engage on social media with targeted consumers.
Take off your entrepreneur hat, and look at your personal consuming habits. You’ll probably find that many of the products and services you use were put in front of you not by chance, but by strategic planning.
What is CRM in sales & marketing?
What is CRM in Sales?
Salespeople have to cover a lot of ground. A robust CRM system lets your agents follow customers along the entire sales pipeline and see when more engagement is needed. And because customer relationship management automates many of the repetitive tasks required for daily workflow, your salespeople have more time to engage with customers in a productive way.
It also provides seamless sales management tools with up-to-date conversion and activity overview reports. Having real-time knowledge of where salespeople are falling short helps managers know where more coaching might be needed — which leads to a stronger overall salesforce.
What is CRM in Marketing?
A CRM platform give marketing teams an in-depth understanding of their target audience. With personalized information, a marketing CRM provides the insight required to build campaigns that resonate. The data gathered by your CRM system — including likes, dislikes, interests, and demographic details — provides a clear portrait of your customer from which you can craft hard-hitting and effective ads.
Additionally, CRMs furnish real-time reports on how campaigns are performing. A/B testing lets marketers see which campaigns have the most customer engagement, and real-time communication with sales lets them know when qualified leads turn into buyers. With this information, marketing teams can further pinpoint their work, using data-driven techniques to attract even more customers to your door.
What is CRM in customer service?
The use of customer relationship management in creating top-notch customer service and support can’t be understated. A good CRM allows your business to meet customers where they are. That means providing support anytime, anywhere. The conversation is always connected and always ongoing via messaging, live chat, social media, email, or voice.
The right software will also help customers help themselves. An integrated help center and forum allows customers to resolve issues on their own time, at their own speed. That also helps reduce resolution time for your support agents.
Speaking of your agents, the right CRM streamlines the support workflow from front to back. All responses are managed and sent from a unified place. Agents become more efficient as they work with routing and sales intelligence technology. And, importantly, all that allows your company to provide customer support at scale. So you can stop worrying about customers and start putting all your effort into growth.
To read more about tools for scaling your business, check out our article about ERP vs CRM.
How do you create a successful CRM strategy?
Getting the most out of your CRM platform isn’t as simple as choosing a nifty-looking software and installing it. Like all technology, customer relationship management solutions need to be approached with a strategy specific to your needs.
To begin, you should have a clear goal for what you want your CRM to do for you. What does CRM mean for your business specifically? Confer with team members across departments to truly understand who is engaging with customers and in what way. Identify any habitual failings in your customer relations — these gaps are key to building a plan for how you can best implement your CRM software.
You’ll also want to create a detailed buyer profile. Ask yourself what your ideal customer journey looks like as they move through your sales funnel. You may find that there are certain features that you’ll utilize more than others.
Most importantly, make sure you’re communicating with your team about why you’re considering using a CRM system. They’ll likely ask the same questions you’ve been asking—What is it? Why use it? What about a free CRM? Give them a clear picture of what your implementation will look like, and how it will benefit them, in order to guarantee buy-in.
Let them know that the technology is there to make their lives easier. The goal of customer relationship management is to simplify, not overwhelm. When everyone is informed and on the same page, your company will be in the best position to make the most of your CRM system.
How do you know your CRM system is effective?
Once you start using CRM software to streamline your daily workflow, you’ll want to know if it’s actually working.
To begin, make sure you’re setting specific, measurable goals. Then, keep a sharp eye on sales data. Close rates, upsell rates, new-net revenue, and length of sales cycle will all tell you if you’re headed in the right direction, or if you’re falling short. If you find that your customer acquisition cost (CAC) is stagnant, you may have to invest time in additional CRM training for your team.
Keep in mind that the true power of CRM is in the way you use your data. Any CRM system can give you numbers and analytics, but you have to know how to interpret them and where to pivot to get the most out of your customer relationship management experience.
How does a CRM boost sales?
Using a CRM streamlines the entire sales pipeline so your salespeople are able to close deals faster and with less effort. By automating many of the tasks that clutter daily workflow, agents have more time to engage with customers. And with all that data at their fingertips, your agents will know exactly what their customers want and when they’re most likely to want it.
How does a CRM system increase customer satisfaction?
With so many options on the market, customers know that they can drop one vendor for another with the click of a button. Having the tools in place to anticipate their needs and address their concerns makes each customer feel valued as an individual, not just as a consumer. CRM also directs customers to the representative who is best equipped to quickly solve their issues, so no one gets stuck feeling like a football being passed from one rep to the next.
When does a business need one?
The more customers you have, the better. But a long contact list does you no good if you can’t manage it. Statistics say the average company starts considering investing in CRM when their contact list breaks one hundred — but a CRM for small business can be valuable to any company that’s finding it difficult to organize customer information and maintain profitable relationships with their current customer base.
How much does a it cost to implement?
CRM pricing depends on the complexity of the software and how many agents are going to use it. In 2021, a platform can cost anywhere from $8 to $100 a month per user.
Should I consider a free CRM?
The short answer — absolutely. Many providers offer a free CRM trial to give businesses the time to evaluate whether the platform and tools suit their needs. Test driving a CRM system gives you first-hand knowledge of what works best for your customer relationship strategy, with no commitment to purchase. However, long term this will be a critical part of your business and worth the investment. Now that you know what it is and what it does, it’s time to start looking at your options.
Try CRM for free
Zendesk Sell is a powerful and user-friendly sales CRM platform that offers a 14-day free trial, so you can test out all of its capabilities before committing to a plan.
Zendesk offers a full range of features, including email automation, auto-dialing, call analytics, a self-service portal, and so much more. And because a smooth learning curve is key to successful CRM implementation, our team of experts are available 24/7 to help you make the most of your CRM experience.
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