Don’t Kill Your Startup: What is CRM and Why it’s Your Secret Superpower
As a startup, choosing a reliable Client Relationship Management (CRM) system is one of the most important software decisions you’ll ever make.
No pressure, right?
Unfortunately, it’s not only one of the biggest decisions — it’s also one of the most difficult. Selecting CRM software is a daunting task and one that can be fraught with uncertainty:
Is your startup ready for a CRM system? (If you’re still reading you probably are AND you were ready the day you started your company.)
Who will own the CRM — Marketing? Sales?
Which features do you need immediately? Do you sacrifice customization for a lower initial outlay?
Here’s a guide to the most important considerations.
What is CRM?
If you’ve decided to put CRM software in place, you’re not alone. In 2017, CRM was the world’s largest software market, according to research from Gartner. But, what exactly is CRM, and how can it benefit your business?
Salesforce provides a simple CRM definition:
“Customer relationship management (CRM) is a technology for managing all your company’s relationships and interactions with customers and potential customers. The goal is simple: Improve business relationships. A CRM system helps companies stay connected to customers, streamline processes, and improve profitability.”
Now, temporarily forget all about the buzzwords and talk about funnels, lead scoring, and up-sells (these are important and we’ll come back to them a little later), and focus on the first two points.
Improve Business Relationships AND Stay Connected to Customers
This is at the heart of CRM. With that in mind, we’ll examine how a CRM system builds mutually beneficial business relationships.
Know Your Customer
Learning to understand each other is a core ingredient in a relationship. CRM tools provide a simple dashboard where you can log information about your customers and leads.
At a basic level, CRM tools capture:
- Name
- Website
- Phone number
Advanced functionality tracks important updates about your customer’s company and communication preferences.
The magic of CRM is that it provides a unified overview of customer exchanges across all platforms. A customer being forced to explain their issue every time they speak to a new support agent or use a different communication medium makes for a slow, dissatisfying customer experience.
Additionally, customer service has never been more important, according to these statistics gathered by HelpScout.
- 7 out of 10 US customers say they’ve spent more money with a company that delivers good service
- Millennials will spend 21% more for good service
- After one negative experience, 51% of customers will never do business with that company again
- Increasing customer retention by 5% increases profits by up to 25%
- It’s 5–25 times more expensive to acquire a new customer than it is to keep a current one
So, to retain customers, you must keep them happy, and when you keep them happy, your business grows. Here’s how a good CRM system helps to accomplish that goal.
Non-Sleazy Upsells That Meet Genuine Customer Needs
Upsells and cross-sells have a bad rap. The terms conjure up images of greedy sales reps trying to milk clients. Upselling defines the act of selling customers premium products in the same category of their purchase, whereas cross-sells are the addition of related services.
A CRM can study a customer’s preferences through analytics to recommend upsells or cross-sells that will help the client solve a business problem. When done effectively, your customer will love you — upsells generate 4% of sales for online retailers.
Automate Routine Tasks to Improve Productivity
Leads need to be studied, analyzed, and categorized. Most prospects take time to convert and need to engage with your product multiple times before buying. Categorizing your leads will also facilitate better lead nurturing. This can demand substantial chunks of your time.
A CRM tool identifies the ideal time to pursue these opportunities and performs time-saving automated functions to manage leads and routine customer interactions, like the creation of quotes or follow-up emails.
Defeat Data Silos
These benefits all rest on one asset — data.
Data silos lead to disconnected customer service experiences. A customer who is forced to explain their dilemma across different platforms to different staff will get frustrated… and quickly. The right CRM tool can bring your team together around a single source of truth.
Types of CRM
Now that you know why you need a client relationship management system, let’s look at the market.
In this post on Medium, Serena lists the key types of CRMs:
All-in-one approach
An all-in-one tool like Salesforce covers all the bases, but it is also the most expensive CRM system out there. Another all-in-one is Zoho, which is a cheaper option with less functionality.
Best of breed
A type of CRM system that only focuses on sales, with little application in other business areas.
Specific development
A common concern for startups is whether a client relationship management system can meet their individual needs. A custom CRM will accomplish this goal but at a steep price that’s out of reach for most startups.
AI and chat
Here on Medium, Michael B.Gilroy investigates a new solution: the marriage of AI and CRM.
“… there have simply been some major advances in AI driven primarily by our increasing compute power(…). Our end result is a mobile ecosystem that is served by a wealth of interconnected applications that are working together and powered by incredibly powerful AI.”
A tool like Clickatell Touch gains deep insights into customer satisfaction with sentiment analysis, and saves time as AI solves routine, repetitive customer queries.
Key Considerations
When you’re running a small business, two things matter: time and money.
Start with a simple CRM and customize. A standard tool gets you off the ground quickly and means less time training staff on a complicated new system. Clickatell Touch lets you get started for free, with per-seat billing. It works across channels and there’s no development or coding required.
If you want to supercharge your CRM, consider integrating bulk SMS into your existing CRM system. SMS remains the most cost-effective, reliable way to reach customers, and paired with CRM it delivers powerful business results. Dig a little deeper into the topic but reading our article on the benefits of SMS and CRM working together for your business.
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