It feels like everyone on the internet is banging on about customer relationship management (CRM) at the moment. But while it’s a hot topic online, just 24 percent of small businesses in the UK actually use CRM software. And that figure only climbs to a meagre 42 percent in mid-size businesses with less than 250 employees.
Why aren’t more small and medium-sized businesses (SMBs) adopting CRM software? Here are the most common reasons:
- They think CRM is for big corporations with thousands of customers.
- They think it’s far too expensive.
- They think they don’t need it. Spreadsheets are fine.
Why CRM is necessary
The reality is that every business, especially SMBs, should be using CRM software. Why? There are a few reasons - which we’ll get into - but here’s the big one:
Research shows that knowing who your customers are and what they want correlates strongly with growth.
If you're plan on growing your business (or even just staying in business) you need CRM software. Here’s four reasons why.
1. It makes your sales process more effective.
The sales process, as you know, isn’t straightforward. It’s not just a phone call and a follow up email. It’s a collection of activities stretched out, often over a long period of time and across different channels like email, phone, marketing events and more.
A CRM system helps you track all your sales and marketing efforts, so you can have a cohesive view of where your leads have come from, and what your sales pipeline looks like. This makes it easier to prioritise, follow-up and close leads. It also makes it easier to:
- Work out which marketing channels and activities are most effective;
- Analyse your sales process and identify opportunities for efficiency gains; and
- Identify cross-sell and up-sell opportunities.
The more you know about your sales process, the better. Don’t sell harder; sell smarter.
2. A CRM system organises your data, and that makes it more usable.
There’s a good chance that your customer data - contact details, contract values, products purchased, lifecycle information - is stored in a spreadsheet on your hard drive. It may even be split across various spreadsheets, or across your accounting and record-keeping systems.
A CRM system brings all your customer data into one place, giving you a complete view of individual customers as well as your customer base as a whole. That’s a powerful advantage to have, because it paints a big picture of who your customers are, what they’re buying and how long they’re sticking around.
3. It’s a win for compliance.
Having all your customer data in a CRM system makes it easier to search, edit, audit and delete it. You can’t achieve that level of transparency with a folder full of spreadsheets stored on one person’s desktop.
This is great for data protection and compliance, especially in the era of the GDPR. Knowing what data you have and being able to audit and remove is critical for meeting GDPR requirements. You can read more about that here.
4. You can use it to improve and personalise the customer experience.
Do you think someone at your local movie theatre remembers your birthday every year, and decides to email you with a discount offer? Is it a coincidence that your bank invites you to increase your credit card limit before Christmas time each year? Of course not. That’s CRM in action.
According to research by Walker, customer experience will overtake price and product as the key brand differentiator by 2020. Indeed, many businesses are already competing on the basis of customer experience. Whether you sell apples or accounting services, customer experience is absolutely critical. These days, even B2B businesses need to meet consumer demands for better, more personalised experiences.
With a CRM system, you can capture and make use of detailed information about your individual customers, their purchases, their behaviours and more. And with this information, you can personalise every single interaction with them. Even the smallest things, like personalising a marketing email, makes a big difference.
It’s time you got into CRM
Whether you have five customers or five hundred, you need a CRM solution. It will give your business the transparency, efficiency and competitive edge it needs in today’s market.
Not sure where to start? Check out our ultimate guide to choosing a CRM system for your small businesses, or get in touch with us here.