What is CRM Software & Why Do You Need It to Grow Your Business

If you’re a small business owner, you know that keeping your customers happy is essential to your success. Customer satisfaction is a key factor in customer retention and something that you’ll need to prioritize whether you’re just getting started or have been in business for years.

At Select Funding, we speak to small business owners every day to help them pursue their goals. Part of that is making sure that they know which tools can help them manage their customer satisfaction. That brings us to CRM software.

If you’ve never used CRM software, you may be asking yourself, “What is CRM software?” In this post, we’ll explain what it is, what it does, and what benefits you can expect from using it.

What is CRM Software?

CRM stands for Customer Relationship Management. As you might guess from the name, CRM software is a tool to help businesses manage their customer relationships starting when they are leads. It provides a variety of functions to help you and your sales team nurture leads and get them to the point where they become paying customers. Once they’ve made a purchase or signed up for your services, CRM software can help you retain those customers.

Without CRM software, businesses may need to use several tools to do everything associated with customer relationship management, including maintaining customer contact information and tracking sales.

What Are the Key Functions of CRM Software?

If you decide to buy CRM software, you should know what it can and should do. You’ll need to compare costs and functions to choose the software that’s best for your business. Here are some of the most important functions of CRM software:

• Contact management. CRM software allows business owners to track customer data, including phone numbers, email addresses, and even social media handles. In addition to telling you how to contact customers, CRM software allows you to track your contacts with customers with notes and attachments.
• Lead management. With the right CRM system, you can capture leads from a variety of sources, shepherd them through your sales pipeline, and maximize your conversions by making sure that every qualified lead has a positive experience with you and your team.
• Pipeline management. A related function is pipeline management, which allows you to track where your leads are in your sales pipeline. You can even create separate email lists to send at each stage.
• Analytics. One of the best things about CRM software is that you can use it to track KPIs and get useful information (and reports) about your customers. The information you gather with an analytical CRM can be helpful when designing marketing campaigns, predicting sales, and setting up customer loyalty or referral programs.
• Email. An email marketing campaign is still a highly effective and affordable way to keep in touch with leads and customers. CRM software often comes with tools to help you create and manage mailing lists, including A/B testing.
• Automation. It’s common for operational CRM software to allow users to automate some repetitive tasks. For example, you could create an automation to send a follow-up email a week after speaking to a lead for the first time.
• Quote/proposal management. If your business needs to create quotes and proposals for work, you can use CRM software to customize quotes based on your customers’ needs, including budgets, tax requirements, and more.
• Document management. CRM software is extremely useful if you need to share documents with your clients. Not only can you use it to send contracts and other important documents, you can also track the various versions of documents.
• Marketing. Many versions of CRM software include marketing functions that can help you grow your business. We’ve already mentioned email, but you can also use marketing CRM software to manage marketing automation, track campaign results, and more.
• Forecasting. Every business needs to forecast sales and revenue and CRM software can help you do it easily.

As you can see, CRM software is multi-functional and can help you manage every aspect of your sales process and customer relations.

What Are the Benefits of Using CRM Software?

CRM software can make your job easier by providing a single solution to an array of sales and marketing tasks. Just as important is the fact that it can help you increase your sales and grow your business. Here are some of the most important benefits of using CRM software.

Increased Sales

When it comes to business growth, your ability to attract leads and convert them to paying customers is about as important as it gets. CRM software can help you to streamline the process of managing leads and ultimately, increase your sales to grow your business.

Improved Customer Retention

While attracting new customers is essential, it’s far more expensive than retaining existing customers. With the right CRM software, you can keep your existing customers happy, encouraging them to buy from you again or to stick with your services instead of choosing one of your competitors. Improving customer experience and increasing customer’s lifetime value is key to business growth.

Higher Productivity

Routine and repetitive tasks can be time-consuming if they must be performed manually. With the features included in CRM automation software, you can take routine tasks off your plate and leave yourself more time to interact with customers and meet your business goals. On a related note, automation reduces the likelihood that necessary tasks will slip through the cracks.

Better Customer Service (and Higher CSAT Scores)

There’s a reason that we say that the customer is always right. Customers who are happy with your products or services are likely to stay with you instead of trying one of your competitors. They’re also more likely to leave positive reviews of your business and refer their friends and family to you. Using CRM software can help you improve your CSAT scores, increase customer retention, and even attract new customers who read about your excellent service.

Better Internal Communication

Internal communication is essential in every business and particularly when it comes to communicating important information related to your customers. Without CRM software, you might not share the results of a client meeting or phone call with your colleagues or do a good job of tracking customers in the pipeline. Collaborative CRM software makes it easy to track notes and documents to make sure that everyone in your company is in the loop.

Easy Customer Segmentation

If you sell more than one product or offer more than one service, you likely need the tools to segment your customers. You may have multiple sales pipelines or sales staff who specialize in one product or service. With CRM software, you can easily segment your customers. In addition to helping you keep track of sales, you can also use customer information and segmentation to create targeted email sequences and relevant offers to improve your conversion rate and increase sales.

Better Data and Analytics

Tracking KPIs is a must for every business because they provide useful figures and insights to help you work toward your business growth goals. CRM software typically comes with an array of built-in analytics and reports. Some software also allows you to create ad hoc reports or add custom analytics. You can use these numbers to track your progress, modify goals, and incentivize your team.

What Are the Challenges of CRM?

Companies who are new to CRM software may not realize the challenges that they’ll face. Here are some of the potential roadblocks to help you pave the way for CRM software:

• Time. If you’re starting with CRM software from scratch, you should expect it to take some time to input the information for your existing clients and leads and get everything set up. Many CRM software companies offer onsite or online training.
• Cost. The cost of CRM software is dependent upon several factors including whether you opt for SaaS or server-based software. Many CRM companies operate as subscription services which makes it possible to spread out the annual costs in monthly payments.
• Adoption. Some of your employees may be resistant to change and struggle to adopt any CRM software you choose. It’s essential to get employees to buy into the benefits before asking them to use new software.
• Lack of Research. Not every CRM software is ideal for every business. For example, many healthcare practitioners prefer software that’s designed for their industry because it includes functionalities – including appointment scheduling and reminders – that they need to manage their patient relationships.
• Lack of Scalability. If your business is experiencing rapid growth, you’ll need to check with your CRM company to make sure that the software you choose is scalable and can accommodate your growing business.
• Software Integration. Before you choose a CRM system, you should decide which integrations you need with existing software to ensure a smooth transition.
• Lack of Training. Training plays a significant role in how effective your CRM software is. You’ll need to make sure that every employee who’ll be using the CRM software learns how to use it and has access to necessary resources.
• Poor Data Quality. Your CRM software is only as useful as the data you put into it. For that reason, you should create data entry guidelines for employees to use because that way, you’ll have consistent data that you can analyze.

Being aware of these potential pitfalls can help you research and choose the best CRM software for your company. We suggest that you take advantage of free demos and trials to help you understand what you’re buying.

Get Financing to Invest in CRM Software

A CRM platform is an investment in the future of your company. With the right software, you can automate repetitive tasks, improve your customer service, and – most importantly – retain more customers and attract new ones to achieve your business goals.

Do you need financing to help you get a CRM tool to grow your business? Select Funding can help! Click here to read about our small business financing and begin the application process today.