Saturday, April 8, 2017
WHAT IS CRM?
CRM solutions provide companies with the customer data they need so that they can provide services or products that their customers want, provide better customer service, cross-sell and up-sell more effectively, close deals, retain current customers and better understand who their customers are.
Most CRM applications include the following capabilities:
*Sales force automation (SFA): This integrates and automates sales processes, including opportunity management, quote and order management, sales forecasting, order management, fulfillment, and incentive compensation management.
*Marketing automation: This software automates the entire marketing process, with capabilities that include campaign and email management, lead reporting and analytics, website search engine optimization and landing page and form creation.
*Customer support and service: These capabilities include case and ticket management, customer portals, time tracking and knowledge management.
Some CRM solutions also allow companies to better manage their channel relationships with functions such a secure partner portal and analytics.
The Rise of CRM
CRM applications can trace their roots back to the 1980s, when database marketing, which collected and analyzed customer information, emerged as a new, improved form of direct marketing. Robert and Kate Kestnbaum, pioneers in this area, introduced metrics such as customer lifetime value, and the application of financial modeling and econometrics to marketing strategies.2
In the mid-1980s, contact management software (CMS) applications such as ACT! appeared on the business software market. These programs let companies store and organize customer contact information—basically, they functioned as "digital Rolodexes."3
In the 1990s, CRM software made some major advances. Contact management software evolved into SFA software, with Siebel Systems becoming one leading provider. By 1995, the term "customer relationship management" came into use. In the last half of the decade, enterprise resource management (ERP) vendors such as Baan and SAP entered the market, and the competition led to more marketing, sales and service features being added to CRM. At the end of the decade, "e-CRM" vendors came onto the scene, and the first mobile CRM application appeared. Even more importantly, the first SaaS CRM applications were introduced.
The dot-com bust of the early 2000s hit the CRM industry hard, particularly e-CRM vendors. Influenced by Paul Greenberg's book CRM at the Speed of Light, the industry began focusing on more comprehensive CRM applications, as well as solutions that could interoperate with legacy systems.
At the end of the decade and through to the present, cloud-based and SaaS CRM solutions began to conquer the market thanks to their lower cost, speed of integration and flexibility. By the end of 2012, four out of every 10 CRM systems sold were SaaS-based, and the market experienced 12% growth in 2012, three times the average of all other enterprise software.4
With the rise of social media, the term "social CRM" came into play, referring to customer relationship management fostered by communication with customers through social networking sites like Twitter and Facebook.5
Driven by high levels of investment in digital marketing and customer experience initiatives, the worldwide CRM software market reached $20.4 billion in 2013, up nearly 14% from 2012. More than 41% of total CRM software revenue in 2013 came from software-as-a-service (SaaS) solutions, as "organizations of all sizes sought easier-to-deploy alternatives to replace legacy systems, implement net-new applications or provide alternative complementary functionality."
Why CRM matters
If your business is going to last, you know that you need a strategy for the future. You’ll already have targets relating to sales, business objectives and profitability. But getting up-to-date, reliable information on your progress towards your goals can be tricky. How do you translate the many streams of data coming in from sales teams, customer service staff, marketers and social media monitoring into useful business information?
Using a CRM system can give you a clear overview of your customers. You can see everything in one place — a simple, customisable dashboard that can tell you a customer's previous history with you, the status of their orders, any outstanding customer service issues, and more.
You can even choose to include information from their public social media activity – their likes and dislikes, what they are saying and sharing about you. Marketers can use CRM to better understand the pipeline of sales or prospective work coming in, making forecasting simpler and more accurate. You'll have clear visibility of every opportunity or lead, showing you the clear path from enquiries to sales.
And though it’s traditionally been used as a sales and marketing tool, customer service teams are seeing great benefits from CRM systems. Today’s customer might raise an issue in one channel – say, Twitter – and then switch to email or telephone to resolve it in private. A CRM platform enables you to manage the enquiry across channels without losing track.
Life without CRM
More administration, less selling.
An active sales team generates a flood of data. They can be out on the road talking to customers, meeting prospects and finding out valuable information – but all this information gets stored in handwritten notes, laptops, or inside the heads of your salespeople.
On top of this your customers may be contacting you on a range of different platforms – phone, email and social media. Asking questions, following up on orders or complaining. Without a common platform for customer interactions, communications can be missed or lost in the flood of information – leading to an unsatisfactory response to your customer.
Details can get lost, meetings are not followed up promptly and prioritising customers can be a matter of guesswork rather than a rigorous exercise based on fact. And it can all be compounded if a key salesperson moves on.
Even if you do successfully collect all this data, you’re faced with the challenge of making sense of it. It can be difficult to extract intelligence. Reports can be hard to create and waste valuable selling time. Managers can lose sight of what their team are up to in reality, which means that they can't offer the right support at the right time – while a lack of oversight can also result in a lack of accountability from the team.