A CRM system is a tool for managing customer relationships and interactions with both existing and future prospects. It helps companies stay connected with customers and make unique offers to clients based on their needs and preferences.
When talking about a CRM system, most people imagine contact management dashboards, sales management improvements, sales agent productivity boosts, detailed sales reports, a customizable sales pipeline, etc. Notice how everything is centered on sales? Don’t get me wrong, without a doubt, sales is an essential factor to any business’s success regardless of industry.
What if I told you that there is an even greater profit generation mechanism than customer acquisition? What if you could increase your profits by up to 3.5 times, without gaining any new customers? I’m talking about customer loyalty and retention.
This isn’t just a hunch. Here are a few references you may want to check out:
- A study by Harward Business School has revealed that a mere 5% customer retention increase can boost profits by 50%, on average.
- Poor customer retention policies are the number one reason why existing clients stop buying from you.
- According to KPMG, customer retention is the most significant revenue driver in retail.
- 91% of consumers are more likely to shop from brands who recognize, remember, and provide them with relevant offers and recommendations.
- Acquiring new customers costs 5 times more than retaining existing ones.
- It costs 16 times more to build a long-term relationship with a new customer, compared to maintaining existing ones.
This list can go on forever, but you get the point. The truth is that every business needs to go out of its way to keep existing clients happy. And unsurprisingly, the data that you gather with your CRM system can be invaluable for this case. More specifically, here is what you can extract from your CRM system to utilize in your marketing campaigns:
- Email and customer support interactions
- Demographic profile
- Purchase history
- 360-degree customer profile
- Preferred communication/marketing channels
- Best times to reach out to a specific contact during the day/week
- Customer lifetime value
It’s important to remember that marketing isn’t just a lead generation technique. It is also one of the main pillars of customer retention. Remind your customers of your values, and show that you care about them.
Personalization – The Biggest Thing since Sliced Bread
Every customer prefers a personalized approach in everything. They expect you to know what they want, how they want it, when they want it, and how it should be presented. And the greatest part is, your sales team has already done exactly that to get the customer on board.
Now, all you have to do is include those customers in corresponding marketing workflows and keep them engaged, happy, and connected with your business. Tailoring messages to specific contacts while relying on solid data is the key to sending the right content to the right people.
To understand how to do this, you need to think about these three questions:
- How did the leads enter your sales pipeline? – The CRM data allows you to find which channel has been used to bring the lead on board (inbound marketing campaign, cold call, free trial, etc.) This information can be useful in determining the preferred means of communication with a specific prospect, to utilize in future marketing campaigns.
- Why did the lead make a purchase? – Because CRM systems like com record and store all the interactions and communications between leads and sales reps, you can skim through the reports to understand the tipping point. For instance, if it was a unique software feature, you can expand on that topic in future marketing campaigns. Or, in the case of an e-commerce business, it may have been your loyalty program or customer service. You get my point: find the correct pressure points and continue building on those.
- Who is buying what? – Typically, people with similar demographic portraits have similar buying habits. You can scan your CRM data to identify what various customers have been buying, and focus your marketing efforts on upselling those to leads/existing customers with similar demographics.
Upselling in a Way Customers Can’t Refuse
Upselling products and/or services is an excellent marketing technique. However, it has to be approached with caution. As I mentioned above, customers expect you to know and understand their needs and preferences, and the last thing they want to get is an email with a totally irrelevant offer. In fact, if you continuously send such emails, you’ll be facing the nasty “unsubscribe” clicks before you even know it.
The CRM data allows you to check your customers’ purchasing history, and understand what type of products they may be interested in. Whenever you have a new product, service, or feature, don’t rush to email your whole contact list. Take the time to understand which clients would likely be most interested in your offer, and create a custom workflow for them.
You can go one step further and personalize your email campaigns even further, by showing how the new feature/service/product can help solve their needs. And how do you know this? That’s right, it’s the answer to the “Why did the lead make a purchase?” question we discussed above.
Focusing on the Right Leads
Your existing customer base allows you to better understand leads and visitors, and focus on the correct ones. Typically, an average business has up to 5 customer profiles that they’re most successful with (excluding e-commerce).
You can browse the CRM data to see which leads became customers, and which ones were disqualified by your sales team. From those leads that made a purchase, you can extract information like their job title, industry, company size, geographic location, age, gender, etc. Using this data, you can create highly targeted marketing campaigns. Similarly, knowing which leads were disqualified will help you stay away from poor quality leads that are less resonant with your brand/product/service.
CRM Data Improves Marketing ROI and Customer Retention
Nowadays, the competition among brands is fierce. Most markets are highly saturated, with multiple brands offering the, more or less, same products/services. While adding distinguishing and unique features to the core product is essential to stand out, it may not be enough anymore.
You need to make sure that your brand provides a simply outstanding experience, both before, and after the leads make a purchase. Your customers must feel that you know them like nobody else, and whatever you offer has been made specifically for them, not just the masses. Do this, and they will stick with your brand for a long time.
And you know what else? They will bring friends.