CRM Systems Explained

The benefits of CRM can help a small business grow

Chapter 01: Surprise! You need a CRM

It seems to happen overnight: One day you open for business and the next you celebrate your 1,000th customer.

How can you keep those customers happy—and the thousands more to come? A CRM system is built for just this job. It helps a growing business of any size maintain, keep track of, and anticipate every customer need.

Chapter 02: What is a CRM system?

A CRM system is for customer relationship management—the technologies and strategies that a company uses to understand its customers and improve its relations with them. The CRM system is a software platform that manages contacts, supports sales teams, tracks the progress of potential new customers, and improves productivity.

A CRM system will:

  • Store business and contact data about existing customers
  • Track and score new leads
  • Manage tasks for sales and marketing teams
  • Analyze data and define useful customer groups
  • Organize communications with clients
  • Improve productivity
  • Build loyalty with existing customers

Chapter 03: Benefits of CRM

The benefits of a CRM system are available to salespeople, marketing teams, customer support specialists, and anyone who comes in contact with customers.

Perhaps the biggest benefit is organization. As you transition to the system, you'll enter basic contact information such as phone numbers, email addresses, and preferred contact information. Once your CMS system is up and running, users can follow and track basic information and advanced data about every single customer.

A CRM system is a central place to store and manage all information, and that makes life easier for everyone. And "everyone" includes your customers, who get better service and more detailed attention as you begin to understand them more deeply.

Other CRM benefits include:

Task tracking. The right software integrates a company’s typical workflow and saves time spent on daily tasks. Automation can boost customer engagement and provide consistency. The truth is, consistency is one of the unsung benefits of a CRM system: When customers get mixed messages, they quickly grow confused instead of enthused.

More sales opportunities. Nobody wants to stop at 1,000 customers. But sometimes companies struggle to come up with great ideas to grow that customer base. One way is to learn more about the people who are already customers; a CRM system can track purchasing patterns and provide insight into themes and trends. That kind of analytics can help develop micro-targeted plans and strategies for encouraging more sales at specific times.

Sales management. In addition to managing the customer base, a good CRM is also robust enough to track sales progress for your whole organization. If you're a one-person shop, you get the help you need to track leads and follow up. If you have a large sales team, each new set of leads is assigned to a sales rep and their journey is tracked from that point on. As the journey progresses, the CRM platform provides a starting point to act on sales trends and close gaps. It's also an easy way to track the performance of your sales team itself.

Chapter 04: CRM benefits for the marketing lifecycle

Many organizations use a CRM system to help them reach their overall marketing goals. Marketing automation built into a good CRM can increase sales by building a solid customer base that you can reach and follow through the marketing lifecycle.

Not every lead is a good lead, after all. A CRM benefits your team by gathering a lead’s information and helping you judge its value through all stages of the marketing lifecycle: attract, educate, wow, sell, and close. When a strong lead is closed, a customer is born—and the life cycle repeats itself in hopes of nurturing a repeat customer.

All along the way, the CRM system helps determine what steps to take and where best to allocate resources. This kind of planning and tracking helps a business plan ahead and grow in a healthy, managed way.

Chapter 05: How does it work?

As a company generates qualified leads, a CRM tracks the actions of a potential customer through social media, email, and website channels. The system absorbs as much information as possible on leads before guiding them—or helping you guide them—through a planned journey that hits all the hot spots.

For example: Suppose a local resident is looking for someone to paint their house. They contact a remodel and repair business, which asks about the reasons for the paint job, the planned budget, and the location of the work. All of this information goes into the company's CRM.

If the potential client indicates a specific reason or timeline for the paint job and also mentions their house is in need of more repairs, the business sees the full opportunity for a sale. This may trigger a series of events, from an automated email with a video showcasing the company's work to a follow-up call scheduled for 48 hours later. If the CRM shows that the person revisited the company's website, another chain of sales steps may be triggered.

Conversely, if this lead offers information that suggests they're now looking for paint at local stores to do the work themselves, this lead might fall out of the funnel. In that case, the CRM will downplay the lead and direct the sales team's time toward more likely prospects.

In the end, that's one of the biggest benefits of a CRM system: it aims a company's time and efforts in the most profitable directions, rather than in a scattershot “talk to everyone and hope for the best” approach.

Chapter 06: CRM system best practices

A good CRM provider will offer professional help for setup and use of the software. Here are some of the best practices that they're likely to share.

Identify and segment contacts. Don't just use a CRM as a fancy address book to store contact information. Use its analytics power to segment your audience and support your marketing efforts. For instance, you can create targeted lists of leads and customers by uncovering customers who have visited your website but never made a purchase.

Find hot leads. As with the paint job example listed above, a CRM will help you look for hot leads who have, for instance, expressed interest in a vendor and other services. Set up the right filters to automate this process, and your CRM will separate your hot and cold leads.

Re-engage cold leads. They didn't hire you to paint their house. But maybe they need you to rebuild their deck? Create a targeted marketing campaign to reach exactly this customer (and others like her). A CRM can use all the information it gathers to help you judge and reach out to potential opportunities.

Keep your current customers engaged and happy. New sales are great, but don't forget that your CRM system can help you keep your existing customers happy, too. A CRM can automatically track customer behavior to identify opportunities or danger spots, like a certain period of time passing without a contact. Create your own fields and filters to help you keep your customer relationships warm.

Chapter 07: Conclusion

Whether you're on your first 1,000 customers or your first 100,000, the benefits of a CRM system go beyond simple record-keeping. Used right, CRM is a direct line to your customers and potential customers. It promotes positive experiences, keeps you front of mind, and brings your company the best information directly from the source. And it will keep your sales and marketing team, like your customers, happier.

Want to know more? Learn about Infusionsoft, the CRM system built specifically for small businesses.

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