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Advantages of Customer Relationship

Management
POSTED BY MICHAEL TAYLOR ON NOVEMBER 6, 2014   POSTED IN CRM

The advantages of customer relationship management system extend beyond running a

business and its closely related relationships. Ideally, a CRM system should help your
business improve the relationship with existing customers, find new customers and win
back former customers. This system is integrated into a software system that facilitates
collection, organization and management of the customer’s information. A CRM system
can be beneficial to both small and large scale businesses as long as it is implemented
appropriately. This guide outlines the major advantages of customer relationship
management to expect upon installation of the software.

Advantages of Customer
Relationship Management
Enhances Better Customer Service
 
CRM systems provide businesses with numerous strategic advantages. One of such is
the capability to add a personal touch to existing relationships between the business
and the customers. It is possible to treat each client individually rather than as a group,
by maintaining a repository on each customer’s profiles. This system allows each
employee to understand the specific needs of their customers as well as their
transaction file.
 
The organization can occasionally adjust the level of service offered to reflect the
importance or status of the customer. Improved responsiveness and understanding
among the business employees results in better customer service. This decreases
customer agitation and builds on their loyalty to the business. Moreover, the company
would benefit more by getting feedback over their products from esteemed customers.
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The level of customer service offered is the key difference between businesses that
lead the charts and those that are surprised with their faulty steps. Customer service
efficiency is measured by comparing turnaround time for service issues raised by
customers as well as the number of service errors recorded due to misinformation.
 
A good business should always follow – up with customers on the items they buy. This
strategy enables a business to rectify possible problems even before they are logged as
complaints.
 
Facilitates discovery of new customers
 
CRM systems are useful in identifying potential customers. They keep track of the
profiles of the existing clientele and can use them to determine the people to target for
maximum clientage returns.
 
New customers are an indication of future growth. However, a growing business utilizing
CRM software should encounter a higher number of existing customers versus new
prospects each week. Growth is only essential if the existing customers are maintained
appropriately even with recruitment of new prospects.
 
Increases customer revenues
 
CRM data ensures effective co-ordination of marketing campaigns. It is possible to filter
the data and ensure the promotions do not target those who have already purchased
particular products. Businesses can also use the data to introduce loyalty programs that
facilitate a higher customer retention ratio. No business enjoys selling a similar product
to a customer who has just bought it recently. A CRM system coordinates customer
data and ensures such conflicts do not arise.
 
Helps the sales team in closing deals faster
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A CRM system helps in closing faster deals by facilitating quicker and more efficient
responses to customer leads and information. Customers get more convinced to turn
their inquiries into purchases once they are responded to promptly. Organizations that
have successfully implemented a CRM system have observed a drastic decrease in
turnaround time.
 
Enhances effective cross and up selling of products
 
Cross – selling involves offering complimentary products to customers based on their
previous purchases. On the other hand, up – selling involves offering premium products
to customers in the same category. With a CRM system, both cross and up – selling
can be made possible within a few minutes of cross – checking available data.
 
Apart from facilitating quicker offers to customers, the two forms of selling helps staff in
gaining a better understanding of their customer’s needs. With time, they can always
anticipate related purchases from their customer.
 
Simplifies the sales and marketing processes
 
A CRM system facilitates development of better and effective communication channels.
Technological integrations like websites and interactive voice response systems can
make work easier for the sales representatives as well as the organization.
Consequently, businesses with a CRM have a chance to provide their customers with
various ways of communication. Such strategies ensure appropriate delivery of
communication and quick response to inquiries and feedback from customers.
 
Makes call centers more efficient
 
Targeting clients with CRM software is much easier since employees have access to
order histories and customer details. The software helps the organization’s workforce to
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know how to deal with each customer depending upon their recorded archives.
Information from the software can be instantly accessed from any point within the
organization.
 
CRM also increases the time the sales personnel spend with their existing customers
each day. This benefit can be measured by determining the number of service calls
made each day by the sales personnel. Alternatively, it could also be measured through
the face – to – face contact made by the sales personnel with their existing customers.
 
Enhances customer loyalty
 
CRM software is useful in measuring customer loyalty in a less costly manner. In most
cases, loyal customers become professional recommendations of the business and the
services offered. Consequently, the business can promote their services to new
prospects based on testimonials from loyal customers. Testimonials are often
convincing more than presenting theoretical frameworks to your future prospects. With
CRM, it could be difficult pulling out your loyal customers and making them feel
appreciated for their esteemed support.
 
Builds up on effective internal communication
 
A CRM strategy is effective in building up effective communication within the company.
Different departments can share customer data remotely, hence enhancing team work.
Such a strategy is better than working individually with no links between the different
business departments. It increases the business’s profitability since staff no longer have
to move physically move while in search of critical customer data from other
departments.
 
Facilitates optimized marketing
 
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CRM enables a business understand the needs and behavior of their customers. This
allows them to identify the correct time to market their products to customers. The
software gives ideas about the most lucrative customer groups to sales representatives.
Such information is useful in targeting certain prospects that are likely to profit the
business. Optimized marketing utilizes the business resources meaningfully.
 
CRM software will remain relevant for quiet long as long as businesses desire a quick
balance between product provision and customer acquisition. Inarguably, the
advantages of customer relationship management will remain relevant as long as
businesses desire to build a competitive advantage over their competitors.

A CRM system can benefit your business by helping you

centralize, optimize and streamline your communications
with customers, and become better in these 6 areas.

1. Better knowledge of customers

As simple as it may sound, but a mere fact that you have all information stored on each contact in one
place makes CRM a super powerful communication tool.

Like a cheat-sheet offering easy access to key information, a CRM system gives your sales, marketing and
customer service teams a competitive advantage.

Not only do they know a contact’s full name, email address, telephone number, postal address, website
and social media accounts, but also such critical business facts as a contact’s position in the company,
his/her relations to other contacts in your database, the language they speak, and even their birthdays.

With all this information at your fingertips, personalizing your communication with a contact becomes a
breeze.
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Secondly, with the help of CRM you can save all activities, projects, sales, live chat messages, email
exchanges, invoices, orders, contracts, or customer service requests that a contact has ever been
involved in.

In other words, a CRM system allows you to know better who your contacts are and what they want.

2. Better segmentation

Nobody wants to do business with a faceless crowd. Everybody wants to deal with a perfect audience.

You can do it by segmenting contacts (customers and prospects) into target audiences. And there’s
hardly anything else out there that does segmentation better than a CRM.

CRM allows you to break down data by categories and criteria, making it easy to create focused lists.
Used in sales and marketing, such segmented lists allow you to run specific customer marketing
campaigns (and account-based marketing campaigns) and analyze your sales process and lead pool.

When you know whom you’re addressing, you can consciously tailor your offer, your tactics, and even
your sales pitch!

In a nutshell, a good CRM system helps you know better who is really interested in what you have to
offer, who is still being on the fence, and who’s cold as ice.

3. Better customer retention

Apart from being a great asset in finding and nurturing your potential and new customers, CRM is also a
great tool for keeping your existing customers happy.

A CRM system comes up with a handful of “customer retention” benefits: it will help you keep your
promises by reminding you about appointments or when to send follow up emails.

But what makes the real trick here is that CRM can also prompt you to reach out to those customers
who have not been contacted in while, and perhaps feel neglected.
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After all, keeping an existing customer is 6 or 7 times cheaper that getting a new one, claims the report
by Frederick Reichheld of Bain & Company.

4. Better anticipation of needs

We feel more confident when we know what to expect.

The same applies to business. It’s easier to cross-sell or upsell a customer when you’ve been tracking
their buying habits.

And since one of the key benefits of having a CRM system is to help salespeople sell more and sell faster,
it is the access to customer interaction history through the entire customer journey that allows sales
reps to anticipate customer needs.

If you know the contact’s purchase history – what they bought and when, what contracts they were
offered, what buying habits they demonstrated, and even how they became your customers, you can be
proactive and come up with new or better offers at the right time!

A CRM system is also indispensable in providing great customer service. The access to interaction history
makes it easy to offer timely customer service.

Just a few clicks and you know whether a contact had any problems with your product, how their service
requests were handled, and whether they were satisfied or not. And if they complained about
something in the past – it’s your chance to redeem your reputation and offer a much better customer
experience.

5. Better and speedier communication

Not making your customers wait by quickly replying to their requests is a sign of professionalism.

Saving yours and your customers’ time is the CRM system, which offers you a set of customizable, ready-
to-use email templates, letters, documents, proposals, quotes, invitations, newsletters, etc.

Speaking of ready-made templates, here's one for you.

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Our most recent edition of the Customer Service Benchmark Report found that 90% of companies do
not use autoresponders to acknowledge they have received a customer service email.

Simply copy the template below and upload it in your CRM system to stand out from the competition:

Autoresponder email template

Another benefit is that a CRM system can also help you draft SMS and emails and schedule their
dispatch weeks or months in advance.

And when it comes to dealing with customer service requests, speed is everything!

With all contact interaction history just a click away, CRM allows you to personalize your
communication, send replies offering quick solutions to recurrent problems, send links to FAQs and
videos, not to mention that phone calls can be made straight from the system.

6. Better protection of data privacy

Finally, let’s address the “buzzword of the last few years” – the General Data Protection Regulation
(GDPR)!

In order to comply with the data privacy requirements of the new EU regulation, it’s über important to
have a CRM software that has inbuilt GDPR-related functionality.

The main benefit of CRM here is that it will save you a lot of time and effort, as being GDPR compliant is
a job in itself, not to mention all the unpleasant legal consequences if you violate this privacy law.

With GDPR, it’s better to be safe than sorry.

A CRM system can help you obtain and document your contacts’ permission to store and use their
personal details (consents), send automatic notifications to all new contacts informing that you would
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like to store their data, manage your customers’ subscription to email communication preferences, and
even set up rules to update personal details for groups of contacts – all at one time.

Doing this all manually will take most of your time and you also run the risk of making mistakes. But,
setting up a CRM system to do that for you is a quick, safe and reliable way to make your
communications with customers GDPR compliant, which in turn builds trust as you handle your
customers’ data with respect.