Discussing the ways a proper CRM System might boost your business sounds a little outdated in 2021. After all, most companies use something like this, and the need for tracking, monitoring, and managing your activities is widely recognized. At the same time, the team of Evercode Lab (we are no strangers to this field) can see that many people still fail to understand how effective CRM platforms may be. That is why we have decided to touch on this topic.
Definition and Purposes
Customer relations management systems are aimed at running your interactions with customers via data analytics. An efficient system is supposed to collect as much information as possible automatically and allow easy manual input when necessary. As such, it is to gather every piece across all ‘entry points’, be it contact forms, phone and VoIP calls, social media and messengers, emails, live chats, and even personal meetings.
As a result, you are enabled to:
– Examine each client account or lead, from top to bottom
– Explore your sales efficiency and funnel
– Keep an eye on your retention
– Build projections for the near future
With this in mind, the game is certainly worth the candle. And still, most implementation projects result in failures. Why?
Problems with CRM
You might be surprised, but according to data from business scholars most companies do not manage to integrate CRM systems.
- As early as 2011 Gartner reported that failures accounted for 50% of projects
- In 2007, the Economist Intelligence Unit came to a conclusion the right percentage was 56%
- According to DN News, the failure rate reached 63%
- In 2017, CIO reported that the real indicator must be between 18% and 69%, with their approximation at the level of 33%
We are not going to bore you with further numbers and survey details. No one knows for sure how many projects fail. What matters is as follows:
- A lot of them do
- If you try to reminiscence about your career path in its entirety, you are likely to remember at least one or two instances, as well as your irritation at this or that CRM system.
So, why do they fail while being efficient and able to contribute to your business?
Scientifically speaking, there is an answer to that. According to ‘A systematic review for the determination and classification of the CRM critical success factors supporting with their metrics’ published by ‘Future Computing and Informatics Journal’ and based on an impressive body of literature, the key five impediments included:
- Lack of support from top management
- No clear vision and plan
- Low-quality change management (as you can see, resistance from the staff is always an issue)
- Inadequate programs of training and mentoring
- Absence of a customer-centric vision
As you can see, there is a lot to do if you want to implement a CRM system. Do you need this? After all, it will cost you money, nerves, time, and, unfortunately, conflicts with your subordinates and even bosses. Yes, you need it (by the way, in the future, we are planning a special article on how to overcome the resistance of your employees).
All the obstacles notwithstanding, implementing a CRM is a good idea. Otherwise so many projects wouldn’t have been implemented and so many systems wouldn’t have been developed, against all odds. What makes this idea so palatable to companies all over the world?
As it seems to us, there are three main reasons.
First, it allows you to monitor the efficiency of each employee. A good CRM system allows you to aggregate individual cases very well, from bottom to top. Step by step, you can gradually zoom in and evaluate every sequence: the entry point, points of contact, deals, client accounts, and the ultimate performance.
Correspondingly, it will be harder for an underperforming, lazy or dishonest coworker to conceal their flows. At the same time, it will enable you to reward your successful colleagues in a transparent and meritocratic fashion.
Second, via a modern CRM system, it is easy to build, visualize, and present your UA funnel. Normally, modern solutions make it possible to assign tags to incoming queries, be it PPC, email blasts, sponsored content. After that, you can monitor how these leads turn into opportunities, full-fledged accounts, or lost customers.
Third, with a good CRM solution, you can solve an equation that can decide the fate of your business. Frankly speaking, we are surprised how often businesses ignore this ratio. We mean your customer acquisition cost versus the customer lifetime value.
Basically, it is no rocket science. The first dimension is nothing more than dividing the cost of acquiring new customers by your marketing spending. However, you need to consider the UA channels you utilize while dealing with this metric. And CRM systems are invaluable in this respect. As for the second one, it is more complicated. The easiest way is to multiply the average revenue generated by a customer within a certain space of time by the typical length of a contract. It is virtually impossible to imagine without a CRM system (unless you love spreadsheets too much).
The team of Evercode Lab is experienced in building CRM systems. We know what we are talking about. We are always happy to create a system adjusted to your needs and business processes. We look forward to discussing your one.