What is Customer Relationship Management Software?
Customer Relationship Management (CRM) software describes a category of applications that manage the interactions between business sales team members and their prospects, leads and customers. CRM tools generally implement calendaring functionality and a transaction-based model to support customer contact and work flow.
As a sales tool, CRM systems can be used as sales force automation systems used to initiate contact with prospects, manage customer service issues and to upsell additional and new products and services.
CRM adoption has steadily increased in recent years with more than 60 percent of sales coming from businesses with revenues less than $1 million. The CRM industry is forecast to grow to $36.5 billion in sales by 2017 according to a Gartner Group forecast.
The Gartner study also found that adoption of the technology has increased with estimates that more than 55 percent of the sales staff were using some form of CRM.
Customer management software is a 30 year old business, the first tool providing sales contact lead support, being released by ACT! In 1986. Sales use trends have been set by the adoption and implementation of that tool since.
Sales is a highly dependent on interpersonal interactions and communications. The abstraction that early CRM tools implemented created a barrier to using the tools to increase sales. Early surveys revealed that sales staff expectations were not realistically matched to what those early systems could offer. The tool provided for capturing details about their customer interactions and meeting appointments and sales calls, but it didn’t turn out to be the magic bullet that automatically made sales contacts more successful. In fact, many salespeople felt that the additional workload created by the CRM got in the way of doing the actual selling. Frequently, the data that the sales department needed to do their job wasn’t even available in the CRM.
Supporting Sales Efforts
Newer CRM systems focus on improving the productivity of the sales department by implementing a real world workflow. They support interactions with sales staff where they most frequently are, on the road. The new customer management paradigm restores the tool’s use to relationship building rather than a management mindset, which can create psychological barriers.
They support these sales requirements in 4 key ways.
1. Software as a Service
The cloud is everywhere. Utilizing cloud-based user interfaces enhances the CRM use experience. Sales can access the web from their hotel, coffee shop or home offices much easier than dialing into the company’s VPN and dealing with the associated technical issues and bottlenecks. This is thankfully becoming a standard which gets built into every modern CRM system (example here).
The software as a Service model is also highly cost effective. They allow companies to pay for what they use, as they use it, which increase its attractiveness and accessibility to small businesses.
2. Mobile Support
Cell phones and tablets have replaced laptops as the primary technology tools used by sales to access their calendars and their text messaging and email accounts. That is a trend that will only continue to grow. Forecasts are predicting that by 2020 mobile devices will be the primary tool for business computing.
Sales teams in companies that implement sales mobility technologies outperform those that do not by more than 26 percent in quota attainment.
3. Social Media Integration
Companies are making significant investments in their social media marketing campaigns. Newer CRM tools will support customer expectations that their posts on business social media sites are reviewed by business team members to do everything from initiate contact, place orders, respond to customer service queries and authorize discount pricing.
Having this type of real-time feedback is also extremely important for the marketing department in assessing the effectiveness of content and media campaigns.
4. Application Program Interface (API)
Older CRM systems supported a fair amount of data feeds from spreadsheets, databases, email systems and pre-formatted files. That wasn’t enough. Today’s CRM systems must accept feeds from and provide feeds into the company’s big data systems. Smarter conversion tools and ISO compliant formats are additional areas addressed by the modern CRM API’s.
CRM system technology is at the early phases of an explosive growth trend that businesses can’t afford not to be a part of. Today’s CRM systems no longer manage leads and sales calendar as additional workload. They offer realistic workflow models and are highly integrated with core operational and strategic business technologies. They integrate with mobile and social media technologies and result in higher sales team performance levels.
Philip Piletic – Originally from Europe, now situated in Brisbane, AUS where I work & live. My primary focus is the fusion of technology, small business, and marketing. I love to share my experience with others by contributing to several blogs and helping others achieve success. Currently, I am associated with LockedOn