Running a small business can sometimes feel overwhelming. From delegating tasks to employees to fielding potential investors and finding new sales leads, you truly need to be a master of all trades to run a business successfully. And with the ever-increasing workload that comes with a successful small business, some customer relationships might fall through the cracks.
Fortunately, other companies have developed customer relationship management systems (often shortened to CRM systems) to help you maintain those relationships. CRM systems utilize various within-software modules and external integrations to run your business more smoothly, and generally include lead generation tools that remind you of valuable customers and promising potential clients. Here, we’ll dive further into some of the key reasons that CRM systems will benefit your small business.
- Increased Conversion Rates
A tough pill to swallow as a sales team leader or a business owner is the lack of business from the vast majority of leads. Even when a potential client seems extremely interested, lines of communication can suddenly go quiet with no sign of returning. In fact, nearly 80% of all leads are estimated to never be converted into real sales. But with the use of a CRM system, this number goes up substantially – sometimes even up to 30% more of potential leads turn into tangible clients.
This massive increase in conversion is largely due to the holistic approach that CRM systems take to lead conversion. While you may be implementing a social media marketing campaign and a cold emailing campaign simultaneously, it can be hard to decipher how those two campaigns are related. But with a CRM system, the interaction rates of both campaigns can be analyzed simultaneously.
- Cost Analysis and Reduction
Up-front costs of CRM systems can appear quite steep, but with some calculations of the costs these systems can save you, you’ll likely see that implementing one will reduce costs dramatically for your small business. CRM software generally includes robust financial analysis tools that can integrate everything from banking services (securely, usually through encrypted routes) to customer invoicing support.
Some CRM systems also include inventory management and forecasting. For instance, systems like SAP’s Business One platform implement these two tools and a plethora of other financial information to understand details about finances on a micro-scale. With this information, you’ll be able to predict exactly how much of a certain product or service should be allotted at any given time to maximize revenue. Experts like Ludwig Micallef, a senior manager and software developer at Deloitte Digital, strongly believe that these tools can significantly reduce costs.
- Improving Existing Relationships
Once you have regular customers as a small business, it’s important to maintain those relationships – and it’s especially important to keep those relationships positive and professional. There are a few methods that CRM systems implement to help you with this, including:
- Reminders: Once you’ve input your existing customer base into a CRM system and integrated your communication platforms (i.e., email and chatbots, or others), the system will automatically detect the last time you contacted each customer. You’ll then be able to set a time for the system to prompt you to continue that conversation or start a new conversation.
- Invoicing: One of the worst things you can do as a business owner is accidentally invoiced a customer twice for the same product – or completely miss an invoice (though this will probably make the customer happy). CRM systems can assign invoices at specific due dates with pre-programmed services or goods to mitigate this issue and can integrate with customer service centers for better customer support.
- Smart Messages: Some CRM systems have taken customer contact a step further than just prompting you to send an email. These systems will analyze prior conversations and customer information to suggest email topics or highlight certain conversation threads that might be useful for the relationship.
- Marketing Delivery: Marketing content delivery can get spammy for existing customers. With historical data stored in the CRM system, you can automatically opt-out existing customers from advertising campaigns meant to target new customers – or you can target existing customers with enticing new content depending on your marketing goal. Some systems can even help you use social media platforms to market your company effectively, automating daily tweets that maximize user interaction.
- Streamlined Marketing Campaigns
CRM systems are fantastic at most aspects of the marketing arm of customer relationships, not just the marketing content delivery mentioned above. Instead of needing the full participation of your marketing team to run a successful marketing campaign, systems that allow you to automate content delivery and analytics from a single space give fewer people the tools necessary to orchestrate an entire campaign with less stress. Most CRM platforms integrate these services:
- Targeted Advertising: CRM systems store user data about potential leads. You can use that data to target a specific type of lead, tailoring marketing content based on the data you’ve collected through your current set of leads.
- In-Depth Analytics: Sometimes it can be difficult to understand the many data points you get from a single marketing campaign. From click-through rates to time spent engaged with content, keeping track of every data type can become overwhelming. This is why experts like Darryl Stevens, CEO of Digitech Austin, believe that CRM systems are critical for summarizing your data as it comes in. These systems can quickly crunch the numbers and give you an easily understandable output, telling you where your optimal advertising is.
- Lead Partitioning
There are different types of leads – what sales teams refer to as ‘hot’ leads are ones that are likely to snap up a deal the second you offer one, while ‘cold’ leads are ones who might need a few follow-up emails to secure that same deal. These leads take different amounts of time to start generating revenue for you, and you may want to partition time to other tasks that might have more value. CRM systems can help you understand the type of client you have on hand, using information like advertising reach and customer engagement with emails and calls. If you do have dedicated sales staff, you might use this to assign different leads to different sales members based on their prowess with these lead types.
Customer relationships are more important than ever in the Internet age, as clients are constantly bombarded with new products. But creating real connections – and maintaining those connections – can give you and your business long-term revenue and close friends. CRM systems can help you automate that process while still keeping a human touch. These systems can also help you maintain revenue streams, generate new ones, and save time while doing it.