In a previous blog article, I discussed my basic definition of what a CRM is. Now I would like to point out some of the reasons companies deploy CRMs and the resulting benefits of doing so. When executives look at how their business can succeed, I believe they basically boil it down to 3 factors that influence the short term bottom line financials and long term goals/vision. I categorize these factors into simple buckets: increasing revenue, reducing costs/expenses and improving customer loyalty.
One of the most obvious and effective ways to contribute to your income statement bottom line is to increase the top line revenue. CRMs inherently have the features and functionality to identify/qualify prospects while incorporating processes that drive sales efficiently. Qualified CRMs:
- Provide real-time access into customer buying trends
- Allow the sales force to have more face time with customers due to less paperwork
- Provide pipeline management of opportunities
- Efficiently/automatically generate forecast reports freeing up time to actually sell — click here to read more
- Allow for automated marketing campaigns that keep key messaging out in front of potential customers without reps being involved until they are qualified — click here to read more
Reduce Expenses/Costs – Improve Productivity through Automation
Where sales/revenue may drive the gravy train of benchmark growth, profitability drives net income that executives base their strategic decisions on and stockholders evaluate quarterly. CRMs can effectively improve productivity with greater control and streamlining of processes resulting in a reduction of expenses/costs. This reduction allows for a better net income. CRMs have:
- Reduced duplication of efforts (one common data entry repository)
- Automated forecasting
- Integration to back office systems (one data repository for all customer info)
- Reduced time in facilitating Order Placement
- Reduced administrative tasks allowing for automated follow up and task prioritization – Sharing of information
- Automated Marketing Campaigns and promotional incentives
Increase Customer Loyalty and Retention – Improved Customer Service & Responsiveness – Read more here
Studies show that companies expend more resources in convincing a customer to spend the first dollar with them than they do in convincing the customer to spend ensuing dollars. As the relationship develops, each marginal dollar the customer spends with the company costs less for the supplier to gain. Losing a loyal customer to the competition hurts. Not the least because the competition can point to this instance as an example of why it pays to switch to them. CRMs have support modules that can:
- Reduce Pre/Post Call time by allowing agents to access a Knowledge Base of service issues and their resolutions
- View a 360 degree of each customer that calls in allowing for an upsell of product based on their purchase history
- Drive proactive management (knowing customer issues before the customer does)
Don’t be one of those companies that is satisfied with the status quo thinking that if it’s not broke, don’t fix it. You can be rest assured that your competitors are not thinking that way. Even addressing only one of the factors listed above should result in a positive ROI…mitigating any potential risk. Jump on the CRM train!
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