Has this ever happened to you?
You and your friend are hanging out at the mall. You walk past a Nike store and tell your friend about buying a certain pair of shoes.
A few hours later, you and your friend are watching videos on YouTube. As the video breaks for an ad, you see a Nike commercial with the same pair of shoes you were talking about!
Is your phone tracking you without your permission? Is this a conspiracy theory that the government cooked up? Well, yes and no.
What you’ve experienced is an example of customer relationship management (CRM). If you haven’t heard of this term before, chances are you’ve been a participant in it.
Here is a beginner’s guide to CRM.
The Basics of CRM
Customer relationship management. What exactly is it?
It is a combination of strategies that businesses use to improve the customer experience. Some of the data collected through these strategies are customers’ buying preferences, contact information, job titles, and geographic locations.
This is a type of tool that businesses use to improve the relationships with their customers. The more data that a business can collect with their customer base, the more data they can use to improve customer experience.
Types of CRM
Businesses use three different types of CRM:
- Analytical. This type of CRM gathers information about customers that’s invisible to the general public. Some examples are leads that turn into sales, common issues for customers, and frequent customer complaints.
- Collaborative. This type of CRM focuses on customer retention and satisfaction. Some of the information generated from this CRM are a customer’s entire shopping history and an automatic message thanking a customer for their purchase.
- Operational. This is the CRM that helps businesses manage their daily interactions with their customers. Common examples are automatic follow-ups with customers and marketing automations.
The type of CRM a business needs depends on its needs. For example, a larger business would benefit from a collaborative CRM system.
On the other hand, businesses of all sizes use some type of operational CRM system.
Benefits of CRM
An important part of business is maintaining relationships. That’s why CRM is so beneficial to businesses.
It is a tool that can be used to make the relationships between businesses and customers better.
Here are the common benefits that CRMs can bring to businesses.
Greater Customer Service
From the outside looking in, collecting this type of data on customers can seem predatory. But it’s not.
As a business, it’s in your best interest to know as much as you can about your customer base. The more you know about them – their issues, their wants, their preferences – the better you can improve your customer service.
Having this information also helps you create a more unique shopping experience for your customers.
Let’s say you own an e-commerce business and you want to do something special for your customers. You can offer a specialized gift from your business to your customers on their birthdays.
This is the type of experience that shows your customers how much you appreciate them. Which leads to the next benefit: customer satisfaction.
Better Customer Satisfaction
Using CRM can help businesses stay proactive with providing quality service to their customers.
You can use CRM for organizational reasons and keep track of all of your customer profiles. It can be used to track how often you have followed up with your customers.
It can even be used to help you follow up with customers who haven’t purchased from you in a long time. You can track a customer’s purchase history and decide the best way to follow up with that customer.
These processes help to maintain the relationships with each of your customers without any guesswork.
Now you can focus on providing the best service to every customer instead of allowing some to fall through the cracks by not following up.
With a CRM system, you have a tool that helps create additional time for you.
A CRM system
- Makes it easier for you to retain your current customers
- Helps you search for new customers organically
- Protects your customers’ sensitive information
- Handles administrative duties effectively
- Makes it easier for you to scale your business.
All of these tasks can be time-consuming for any business. Having a system that streamlines these tasks frees up additional time for you.
You can use that time to think about the next steps for your business and improve the relationships with your customers.
Instead of reacting to your customers’ needs, this system can help you stay proactive.
Better Long-Term Planning
And when it comes to being proactive, a CRM system can help you create long-term plans for your business.
It’s difficult for businesses to think about long-term goals for many reasons. You could be up one month and then struggling the next. It can be difficult to think about the future when you’re worried about the present.
But a CRM system gives you the best of both worlds. It allows you to take care of the present needs of your business while presenting helpful information for the future.
You could study the data from your CRM system and use it to brainstorm long-term goals for your business. You could set a goal to provide excellent service to a certain number of customers.
You could create a system that meets the needs of your customers while keeping your business running smoothly.
A CRM system allows you to see the possibilities through the collected data.
If this is the first time that you’ve heard about customer relationship management, great!
Take the chance to learn more about this great tool and how you can use it to build better relationships with your customers.
Share your thoughts in the comments section below.