Outgrowing Your Contact-Management System? Make the Leap to CRM

Updated: April 30, 2009

For a small-business owner, sales professional or new entrepreneur, a contact-management solution is the jumping-off point for effective CRM. Nevertheless, though contact-management systems provide SMBs (small- to medium-sized businesses) an opportunity to organize time and manage contacts, a CRM system is key to fueling enterprise growth and yielding stronger sales .

How do you know when it's time to graduate to a more robust CRM system? Consider the following factors.

Managing Contacts Vs. Developing Customer Relationships

Managing contacts is simply having the right contact information for customers and prospects, tracking your communications history with them and scheduling upcoming call-backs or meetings. These days, getting this data is mandatory for anyone starting a business, ranking up there with having a work space, phone, email address and accounting system .

Developing customer relationships, on the other hand, is the process of proactively managing prospects and customers throughout their life cycle with your company. As your business grows, your teams and customer base will expand, making proactive management critical. Developing relationships is about marketing to customers on a personal level, effectively working complex sales cycles and capturing all interactions with them before and after the sale.

When businesses move to this level of managing customer relationships, they are able to boost customer satisfaction, improve retention and grow their businesses.

5 Signs That You Need a CRM Upgrade

How do you know when to move beyond managing contacts to a more formal CRM approach? Here are some critical signs:

  • Your customer-facing staff is growing, yet you and other departments are disconnected from what they're doing.
  • You've received a customer complaint about service and your staff doesn't have an answer for what went wrong.
  • You think your competition is beating you but you're not sure how often and why — whether that's the number of deals, increased market share or another factor.
  • You're not conducting effective email marketing , yet others in your industry are.
  • Your remote staff is growing, but it is difficult to track customer communications in one central repository.

CRM Investment Delivers a Competitive Edge

An investment in CRM means proactively managing customer relationships to gain a competitive edge. CRM processes enable companies to give personalized communications and services so customers feel that they're valued — the same experience they get when a business owner or staff really knows them and values their business. It becomes more and more difficult to deliver that level of service as your business grows, but CRM can help keep that personalized touch.

Some key business processes that can be managed through a CRM software solution include:

  • Collaboration among customer-facing team members : Whether they're in sales, customer service, marketing or management, staff can track a customer's progress and have a high level of confidence regarding the last touch point with a client. Moreover, as your teams grow and multiple people are helping a customer, follow-up calls and other activities can be assigned to another employee to better assist the customer.
  • Customer-service case management for tracking and resolving of issues : Help desks and customer-service reps can generate customer-service tickets to help track and resolve customer issues quickly to retain satisfied clients. They can also help your small business improve its products as you track the number of calls or complaints against specific products or parts.
  • Proactive personalized email marketing : This feature is also known as one-to-one email marketing, and provides avenues to regularly contact customers with a variety of different personalized offerings, either to up-sell or cross-sell.
  • Complex sales management and forecasting : If you have long or complex sales cycles, CRM will help your sales teams collaborate throughout the sales cycle and track an overall pipeline.
  • Automation of processes to streamline work for employees and improve response to customer inquiries : If resources are tight in your small business, automation will help you focus staff time where it's most valuable by taking care of other activities. This is key to improving response times and ensuring all staff are in the know with customer interactions.

Maximize Customer Satisfaction and Revenue

Ultimately, CRM technologies and processes help businesses maximize customer satisfaction and grow revenue. But there are other ares where small business owners experience CRM benefits, such as insight and productivity . As an owner watching your business grow, and having less direct contact with customers, you can still maintain visibility and track customer activity — whether it's seeing the number of outstanding customer-service cases or getting a more accurate sales forecast. Productivity steers the automation of customer communications. Not only does automation allow you to satisfy customers by setting the right expectations, but you don't need to dedicate manual labor to the effort. So, you're seeing results with the same number of employees.

Customers are the key to growing a business. They should be given the royal treatment at each and every point of contact. Moving to CRM will help your whole team better understand and respond to customers' needs and ultimately help your business grow.

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