Let’s face it. No matter how great you are at what you do, your business is nothing without customers. Every single sale you make propels you one step further towards your goals, facilitates your growth and allows you to get one more step ahead of the competition. Given that it can cost anywhere between five and 25 times more to engage a new customer than to retain an existing customer, it’s clear that managing your relationships with the customers you have can make all the difference.
The discipline of managing your customer relationships and the technology used to facilitate and automate it is the subject of this article. We’ll take a close look at CRM, software and automation, and why CRM is so important for your business.
What is CRM?
What does CRM stand for? This commonly used acronym means customer relationship management. Effective CRM involves a combination of strategy, best practice and the adoption of technology that will help to automate and facilitate meaningful relationships with your customers to improve retention, reduce churn and make it easier to deliver the kind of operational excellence that keeps customers coming back and build value in your brand.
What are CRM platforms?
If you run your own business, you’ve likely heard other business owners talking about using CRM or implementing new CRMs. Indeed, you’ve probably got some outbound marketing emails for different CRMs in your spam folder right now.
When people talk about CRMs in this context, they’re actually talking about CRM platforms. Indeed, the term has become pretty much synonymous with SaaS (software as a service) solutions. While there’s much more to effective CRM than the digital tools you use, CRM platforms can make it easier to weave CRM best practice into your daily operations.
At their most basic level, CRM platforms consolidate every piece of information you have as a customer, and store it in a centralised (usually cloud-based) database. A platform can be used to record everything from previous purchases to marketing preferences, or even the names of a customer’s spouse and children – anything that can enrich your relationship with the customer and add value to your interactions with them.
With time and a plethora of competition, CRM platforms have gained new functionalities, including:
Automatically scheduling and sending targeted marketing emails
Tracking and automating customer interactions
Tracking and analysing new lead data
Leveraging AI to identify customer buying patterns and pre-empt future needs
Automating workflows to reduce admin time for sales teams so they can spend more time and effort on quality interactions with customers.
CRM platforms are also designed to integrate with other software your business uses (such as ERP platforms and call centre systems) to reduce friction in your processes and make CRM easier to integrate into your day-to-day business.
Why CRM matters to your business
Customer service makes all the difference. In an age where consumers know how many choices they have, they can afford to be fickle. In fact, just one negative interaction with your brand will send a third of customers running for the hills. What’s more, companies that have a “customer first” approach are up to 60% more profitable than those that do not.
Baking CRM into the crust of your operations can ensure that your interactions with customers are more frequent and meaningful without placing an undue strain on your workforce. CRM platforms are certainly an important piece of the puzzle, but having a CRM is not the same thing as doing CRM.
When your technology, processes and ethos are all unified in delivering value to your customer and strengthening your relationship with them, you have an effective approach to customer relationship management.
We can help
If you’re interested in finding out more about CRM, your spending on customer retention, or anything to do with your business finances, then get in touch with the financial experts at GoCardless. Find out how GoCardless can help you with ad hoc payments or recurring payments.