10 CRM Strategies to Improve Your Business
What Is a CRM Strategy?
A CRM strategy defines goals and practices that a company will use to manage and improve its interactions with customers via a CRM system. In other words, it’s a plan to build stronger relationships with existing customers and generate more leads among prospective customers. Effective CRM strategies enable sales, marketing and customer service teams to tailor their interactions with prospects and customers using data-driven insights on customer behaviors, needs and preferences. These tailored interactions, delivered consistently, create truly customer-centric journeys that catalyze customer loyalty and, ultimately, business growth.
CRM strategies spring from the overarching goals that a company has for its customer relationships. Examples of CRM strategy goals include increasing customer satisfaction, improving customer experience and streamlining the sales process. These goals establish the priorities for a CRM implementation, setting the stage to design CRM practices, which are the specific actions and business processes used by the CRM system. Together, the goals and practices comprise the CRM strategy. Businesses can deploy multiple CRM strategies, and strategy prioritization will help sequence the CRM implementation so that it builds success over time.
- CRM helps businesses better understand and track customer needs and preferences, leading to improved customer experiences and higher levels of satisfaction.
- A CRM strategy provides sales, customer service and marketing teams with valuable insights into customer behavior and buying preferences, enabling them to develop more effective practices for customer interactions that drive increased revenue.
- Data accuracy and consistency is significantly improved by using a CRM system as the central repository for storing and managing customer data, delivering a holistic view of the customer.
- By streamlining processes, improving customer engagement and leveraging data insights, a well-implemented CRM strategy can lead to increased sales, higher customer retention and lower costs.
While a business’s primary internal stakeholders for customer engagement are within marketing, sales and customer service teams, CRM strategies promote collaboration company-wide because they aggregate (often scattered) customer data to improve customer interactions. CRM strategies equip the entire business to leverage customer data in feedback loops to inform product and service offerings, including data from sales, customer service interactions and marketing campaigns. These data insights can also inform the methods, content and timing for customer communications. All of this is made possible by CRM strategies and the software tools that help achieve them.
Take, for example, XYZ Cleaning Co., a (fictional) local cleaning firm servicing both residential and commercial customers. Company managers notice that customer satisfaction has declined and the business’s growth has slowed. After conducting market research, the company realizes that its competitors are getting high grades for their personalized and efficient service. Recognizing that XYZ doesn’t have a way to track detailed information about customers, its managers decided to implement a CRM system to store information specific to customer preferences and behaviors, such as referrals, schedule constraints and specific cleaning demands. Easily accessed via CRM reporting features, these customer preferences would guide XYZ’s employee actions, such as proactively rescheduling cleaning dates that fall on holidays or sending thank-you gifts to referring customers. XYZ’s CRM system implementation incorporates the goals and practices of its CRM strategy.
CRM Strategies to Improve Your Business
1. Define Goals for Your CRM
The first step in any CRM strategy is to define goals based on a clear picture of where the business stands and where it needs to improve. At a high level, define what exactly the business will achieve when it comes to customer relationship management. These goals should be specific, measurable, achievable, relevant and time bound — the acronym for which is SMART. Some example of SMART goals might be to increase sales by 10% in the next quarter, improve customer retention by 5% year-over-year (YOY), or raise customer satisfaction scores by 12%.
Importantly, such business goals should map to CRM strategy goals and their accompanying system practices. The goal to increase sales, for example, may be supported by CRM system practices that improve visibility of customer data that fuel more targeted selling approaches. The customer retention goal could be supported by a CRM system practice of building better customer profiles, i.e., profiles that provide insights into individual customer needs and preferences with which the company can tailor customer interactions. And the customer satisfaction goal could be supported by CRM system practices to cut down resolution times for customer issues.
Additionally, since no CRM program can succeed without widespread adoption of the CRM system, a key goal focused on the CRM system itself should address employee training. The sales and marketing teams will need to adopt the new CRM, so they must understand the system’s functionality and how the new technology will benefit the organization. Effective training will promote adoption of the CRM and integration of the CRM with existing processes.
2. Perform a Business Audit
A business audit can help organizations identify gaps in their current workflows, leading to better alignment with customer needs and improved customer experiences once a CRM system is implemented. Business audit results can lead organizations to streamline their operations and eliminate redundancies, thus increasing the business’s efficiency and productivity. The audit should review sales, marketing, customer service and data management processes, looking for bottlenecks or inefficiencies to prioritize for improvement, such as slow customer response times or lengthy sales cycles that can be shortened.
Include in the audit a review of business goals that your CRM strategy would support, such as increasing sales, market share or customer retention. Your analysis of how the business operates today, how improvements could enhance customer experience and the review of specific goals to aim for should all factor into the design and implementation of a CRM system.
3. Understand the Customer Journey
By understanding the customer journey, businesses can better visualize what customers are thinking, feeling and doing as they work their way through the purchase process. Gathering insights on customer behavior and what they need, when, is key to identifying how your business’s strengths and shortcomings shape customer experience — and defining actions for improvement.
It’s important to map out the different touchpoints that a customer may have with a company or brand in each stage of the buying process (awareness, consideration, purchase and post-purchase). By analyzing customer behavior, feedback and data at each touchpoint, businesses gain insights into their customers’ needs, pain points and decision-making processes. With those insights, companies can, for example, build marketing automation programs that deliver content to answer customer questions, timed for just when those questions begin to arise in customers’ minds.
Customer segmentation can enhance a company’s understanding of customer journeys and, therefore, its marketing automation programs. Because CRM strategy depends on capturing and leveraging customer data, most CRM strategies incorporate customer segmentation — i.e., grouping customers into categories based on common characteristics, such as demographics, preferences or behaviors. In customer segmentation strategies, these groups are often referred to as a “buyer persona.” By creating different customer personas, marketing content can be tuned for each persona, becoming more targeted and, therefore, more effective.
Customer segmentation empowers businesses to tailor their interactions with each buyer persona in ways that are more specific to that group’s needs or preferences, creating the personalization that drives positive customer experience. Buyer personas enable companies to understand variations in the journeys of their different types of customers, getting them closer to the overall goals of CRM strategies — namely, to improve customer satisfaction, increase sales, generate revenue and build long-term customer loyalty.
4. Study the Market
Understanding customers and internal processes is imperative for developing successful CRM strategies and systems, but so is studying competitors. Businesses need a strong understanding of the market they operate in and where they fit compared with the competition — i.e., their strengths and weaknesses right alongside those of their competitors. For example, by analyzing competitors’ offerings, a company can gain insights into the needs and preferences of its own target customers. By studying competitors’ customer service practices, a company can identify ways to improve its own customer service experience. Companies can use all this information to differentiate themselves from competitors and identify opportunities for growth.
In addition to informing business strategy, competitive market information can be used to enhance a company’s CRM solution. For example, consider a clothing retailer that conducts competitive market research including online surveys of customers, analysis of competitor websites and marketing materials and interviews with prospects and customers. The data it gathers identifies the strengths and weaknesses of each competitor in terms of the quality of its customer service, the range of products it offers and the convenience of its online shopping experience. The retailer can then use this information to improve its own CRM strategy. If the competition has a strong online shopping experience, the retailer might focus on improving its own website and making it easier to shop and engage with its brand.
5. Use Automation and AI
Automation and AI can improve the efficiency and productivity of a CRM strategy by automating tedious and repetitive tasks, such as data entry. Marketing automation through a CRM system can trigger personalized emails, schedule social media posts or follow up on leads. AI can refine customer segments for more personalized messages, predict which customers are more likely to churn so the company can take preemptive action, and equip chat bots with answers to common customer questions. Additionally, AI analysis of customer data can provide insights that improve customer engagement, predict customer behavior and better target marketing efforts. It can analyze customer behavior and preferences to make highly personalized product recommendations, improving the likelihood of a purchase.
Overall, the use of automation and AI in a CRM strategy can help a business save time, money and resources, freeing up time for sales, marketing and customer service teams to focus on other duties — all while improving customer engagement and satisfaction.
6. Deliver Personalized Experiences
The goal of personalization is to make any interaction more relevant to that individual customer, thereby raising engagement — and conversion.
7. Improve Marketing With CRM Data
CRM data offers marketers valuable insights into customer behavior patterns, such as how customers respond to marketing campaigns, which marketing campaigns had the most effective offers and which marketing channels generated the best customer response. For example, customers dislike impersonal marketing messages, especially when they know a company has their personal information already. Marketers can pull information from their CRM software to create communications that are individualized for each customer, addressing them by name, title or job function and including their company name as well. (But don’t forget, customers really dislike it when any of that information is wrong, which is why clean data is so important!)
8. Track Performance
Tracking performance metrics lets a business analyze how well its CRM strategies are working and identify those that need improvement. Thinking long-term, regularly tracking CRM KPIs gives businesses the information they need to continually improve. That’s crucial, because what works today might not be effective a few months, or even weeks, in the future. Tracking performance in this way requires businesses to set up a tracking and reporting system capable of delivering metrics in real-time.
9. Create Value-Added Content
Providing valuable, educational content that addresses customer needs and pain points establishes a business as an expert in the industry it serves and builds customer loyalty and trust. Such customer-centric content could include blog posts, ebooks, webinars and podcasts — or any other type of content, as long as it provides genuine value to customers and prospects.
For example, take the local cleaning service discussed earlier. Let’s say a potential customer is researching new cleaning services in their area and follows a search link to a case study from a satisfied customer on ABC Cleaning’s website. The prospect fills out a short form to download the case study and, in so doing, becomes a lead in the company’s CRM system. The customer in the case study describes the challenges and pain points they were having with scheduling, reliability and thoroughness that ABC Cleaning resolved for them — all of which resonates with the prospect. The same customer also gave a video interview expressing their satisfaction with the cleaning service. With the new-prospect lead in hand, ABC Cleaning can nurture the lead with an automated email containing the video interview. Subsequently, a salesperson can call with a specific offer for that prospect.
10. Reward Customer Loyalty
Many businesses have loyalty programs that reward customers for repeat business, giving them incentives to keep coming back. These types of programs lead to customer-brand advocacy, which translates into more referrals, increased sales, and improved customer retention. Two popular approaches businesses can take to build loyalty and repeat purchases are points-based and tiered programs:
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