What is a CRM and why do you need one?

Sales | June 1, 2022 | 7 min read

As an expert helping SMBs grow their revenue, you’ve heard plenty of acronyms. One you might hear from your prospects on a regular basis is “CRM.” You may even have a good enough idea of what they’re looking for when they toss this term around. After all, almost 75 percent of businesses use a CRM already (Martech Zone).

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If you’ve ever wondered, “What is a CRM?” though, you’re not alone. This piece of technology has gone from a “nice to have” to being a crucial part of many businesses’ workflows. Understanding exactly what a CRM is, how it works, and why it's important can help you choose the right one, not only for your own business but for your customers, too.

So, what is a CRM anyway?

CRM stands for customer relationship management. This in and of itself is not new. Business leaders have been managing relationships with their customers for ages now.

What is new is the technology local businesses can use to manage their customer relationships. In the last few decades, many platforms have emerged to improve relationship management. The key difference is that they are all technology-driven.

This switch happened in sync with an expanding number of touch points in sales funnels. Many of these new touch points happen in the digital space. The number of touch points now threatens to overwhelm sales teams. Older methods of managing customer relations just can’t keep up.

The customer journey is more complex than ever

Let’s take a look at some of those touch points to show the ways the sales pipeline has become more complex.

Digital advertising has made it easier than ever to connect with potential customers. Social media, email, and chat have given potential customers more ways to contact you. Tracking on websites can also help you find new leads.

Imagine someone sees an ad for a local pizzeria while they’re visiting their favorite news site. They click the ad and look at the menu. Maybe they even download an app or sign up for a mailing list so they can hear about great deals.

If they saw this ad on social media, they might have commented on it or sent the business a private message. All these interactions are touch points, which the business can follow up on. The pizzeria can answer messages or send email drip campaigns with incentives designed to get this lead to place an order.

There are also more touch points once a prospect converts to a customer. Maybe the business follows up to ask about customer satisfaction. They could send an email with a “thank you”—and another offer to keep the customer buying.

That is a lot of touch points—many more than business leaders needed to think about in the past. It’s no surprise that sales teams feel they need help. Luckily, the CRM platform is here to do just that.

What does CRM software do?

The short answer is CRM software helps local businesses manage their customer relationships.

The technology behind a CRM helps sales teams better manage all those new touch points. Let’s look at some of the ways a sales CRM helps manage the new sales funnel:

Following up with leads

Let’s think about the lead who signed up for an email newsletter. A sales CRM can help manage new sign-ups by sending automatic welcome emails or incentive offers. The platform’s AI can generate content relevant for this particular lead.

What about leads or customers you haven’t talked to in a while? If you have good lead generation or many existing customers, it can be tough to keep up with everyone. The CRM can keep tabs on data points such as last contact. Some of the best sales CRM software lets your clients automate follow-ups at set intervals and run email drip campaigns. Most will let you set reminders so salespeople can follow up in a timely manner.

Sending the right materials

CRM software also helps salespeople send the right materials to prospects. We mentioned AI helping to generate content that resonates with any given lead. A CRM goes beyond that to help deliver the content when the prospect needs it, too.

In the past, salespeople had to rely on intuition about what prospects needed from them. With CRM technology backing them, though, they can get data-powered insights about current prospects.

They can then leverage those insights to make sure they’re sending what the customer needs when they need it. The result? Your potential customer feels better supported on their buying journey.

An example might be segmenting a mailing list. Some of your prospects are going to be enticed by a 10-percent-off deal. Others won’t bite on that offer, but they will sign up for a webinar or download an app. The CRM can help salespeople see which leads have which pain points. In turn, they can provide the support and information the prospect needs to turn them into customers.

Driving employee success

Very few salespeople are selling to their true potential. In fact, some estimates say nearly 60 percent of salespeople miss their quotas (Forbes). CRM software can change that story by offering the tools sales teams need to succeed. Sales intelligence, data analysis, and other tools give salespeople the insights they need to convert.

The CRM also saves time, which leads to better productivity and higher efficiency.

Why do you need a CRM?

Whether for your own use or as a product you offer to your clients, a CRM is an essential piece of software for businesses today.

A CRM has many benefits:

Grow sales and revenue

The most talked-about benefit of CRM technology is its impact on sales and revenue. In fact, some studies suggest a CRM can boost growth by 300 percent (Entrepreneur). Simply looking at some of the features of a CRM should give you insight into how it can help in this area.

Being able to follow up with leads in a timely manner helps. More than that, providing the right materials to a prospect at the right time improves conversion rates. Other CRM features, like scheduling tools for demos and meetings, can also provide a frictionless sales process.

The end result is higher sales and revenue.

Better customer retention

What else does a CRM do for your business? Since it helps you manage relationships better, a CRM usually boosts customer retention.

Why is that? Customers are happier with your sales team and the buying process. When your sales team follows up in a timely way and provides materials that are relevant to the customer, they feel better supported. In turn, they’re more likely to stick with you. As a bonus, this also contributes to sales growth, as happy customers will spend up to 140 percent more (Forbes).

Improving your relationships with your customers can even lead to more growth. Satisfied customers are more likely to recommend your business to others.

Staff satisfaction and employee productivity

Finally, sales CRM software makes it easier for your sales reps to do their jobs. With so many touch points in the sales cycle, they need help managing everything they need to do. With a CRM, they can automate some of their daily tasks.

That frees up their time to do research or further support leads and customers. Since they can spend their time on these qualitative tasks, your team members will be more satisfied with their jobs.

They’re also likely to be more productive and efficient—and to convert and sell even more.

Choosing the right CRM software

Once you know the answer to “what is a CRM?” and all the ways it can benefit businesses, the next question is often: “which CRM should I get?”

This is a more difficult question to answer, because there are so many options on the market. You’ll need to determine your needs and goals first. Then, you’ll want to identify the benefits and features of different CRM options. If you’re planning to offer a branded CRM solution to your clients, ask what your clients need from their CRM as well.

Vendasta’s sales CRM can offer a good starting point to determine what a CRM can do for you.

One of the highlights is the Snapshot Report, the CRM’s sales intelligence tool. This secret weapon helps partners leverage sales insights to realize almost 3 times more opportunities and 18 times more revenue.

In just a matter of clicks, the CRM can generate customized content for prospects too. Further, continuous data analysis in the platform can lead to actionable insights that increase conversions.

Of course, Vendasta’s sales CRM is one piece of a bigger platform. What else do you get with Vendasta? You can combine the sales CRM seamlessly with:

That makes it easy to put in place a complete end-to-end platform in your own business and to provide everything your clients need, under your brand.

Perhaps best of all, you get the help and support you need from our team. Learning new software can be a big task, but it’s a lot easier when you have the experts on your side.

Test drive a better CRM

You asked, “What is a CRM?” and now you know not only what it is but what it can do for you and your clients.

Not sure about your needs? Test drive Vendasta’s CRM with a 14-day trial and discover everything your business can do with the right sales technology.

Turn your digital agency into a scalable power house with Vendasta

About the Author

Solange Messier is the Content Strategy Manager at Vendasta. Solange has spent the majority of her career in content marketing helping companies improve how they connect with their prospects and customers. Her diverse background includes magazine publishing, book publishing, marketing agencies, payment processing, and tech. When she's not working, Solange can be found spending time with her family, running, and volunteering.

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