What is Customer Relationship Management (CRM)?
Customer relationship management (CRM) refers to the processes, tools, and technologies used to support your brand’s relationship with its customers throughout the customer lifecycle— from first interaction all the way through to re-engagement.
While in the past, customer relationship management might have been done with a Rolodex filled with notes (remember those?), today, the majority of businesses—large and small—have shifted to technology solutions that can seamlessly aggregate customer data. This consolidated data can help your marketing, sales, and customer support teams build and foster customer relationships.
What a Customer Relationship Management Solution Looks Like
Your customer relationship management solution should include a variety of elements, such as:
- Contact history
- When did the customer first interact with your brand, whether signing up for a newsletter or visiting your site? How frequently and across what channels have they engaged with you? Have they interacted with specific individuals within your company?
- Deals in progress
- For brands that offer high-value items with long consideration periods, it’s important to look at the deal stage within your CRM. You might rank your contacts by the likelihood of closing a deal or converting to a purchase, based on certain metrics.
- Purchase history
- Has the customer purchased items from your brand before? If so, what, when, and what is their overall lifetime value (LTV)?
- Brand AffinityTM or brand sentiment
- Has the user expressed positive or negative sentiments about your brand in user surveys, phone calls, or customer support messages? Has their engagement been consistent or is it waning? By getting a sense of how they perceive your brand, you’ll be able to formulate more empathetic marketing, sales, and customer support messages for them.
A comprehensive customer relationship management solution should include a 360-degree view of your customers, integrating data from a variety of sources including your email marketing database, your SMS marketing solution, other marketing channels, your e-commerce platform, and your customer support database, among others.
Most customer relationship management tools offer a degree of automation to support you in understanding how to respond to your customers. For instance, “lead scoring” helps you determine how valuable a particular contact may be to your company, based on metrics such as frequency and recency of contact, buyer sentiment, purchase history, and stage of the sales cycle. You can use this segmenting system to help you focus your marketing and sales efforts on qualified buyers, while reducing time spent on less qualified leads.
Customer Relationship Management and Marketing Automation
In some cases, your customer relationship management technology may serve as an integrated part of a comprehensive marketing automation solution, like Iterable. This means that, as you collect insights on your customer base, the data will be used to automate your marketing efforts on a highly segmented and personalized level.
For instance, as a customer visits your website and mobile app, you can track their interactions with your brand and deliver perfectly timed and curated content based on their browsing behavior.
Let’s say a customer who’s previously bought jeans in a women’s size 8 opens an email featuring your new denim line, and visits the product page. Even if they don’t add the item to their cart, their actions can trigger an automated follow-up sequence across all of their marketing channels, including email, SMS, push notifications, and in-app notifications, promoting the offer and even including a link to add the jeans directly to their shopping cart.
By customizing the messaging sequence based on the customer’s actions in each channel, you can maximize engagement while eliminating redundancy. Cross-channel marketing means that each message will build on the one that came before, rather than duplicating messaging from channel to channel. This ensures that each customer has a personalized and relevant experience with your brand, no matter how they choose to interact.
Using Predictive Analytics
Your customer relationship management data will help you understand how to interact with each customer, based on their location, purchase preferences, online behavior, and other data points. From this data, you can create highly segmented groups to form predictive audiences, offering different nurture paths to each one, based on their expected behaviors.
For instance, one segment might consist of customers who have been inactive for at least 30 days. Based on past audience behavior, your marketing automation solution might group these customers as “at risk of churning.” Using data from your customer relationship management tool, you can develop winback streams that are highly customized to each customer’s individual preferences and behavior. If a customer had previously purchased items from a particular makeup brand, you can offer them an exclusive discount code on that brand, encouraging them to make another purchase and remain active with your brand.
You can also identify high-value customers who are likely to buy more than others, and provide them with a higher level of support and brand engagement, offering VIP perks and rewards as part of a customer loyalty program. This will help you nurture a deeper connection and foster even more brand loyalty.
The Importance of Customer Relationship Management
Customer relationship management is an art and a science. You’ll rely on data drawn from all of your customer interactions, as well as background information on their demographics and preferences, to develop the best possible customer experience for each individual.
You can use that data to develop targeted messaging aligned with each individual’s goals, and support them through marketing, sales, and customer service with content tailored towards their preferences and stage in the buying cycle.
By choosing a CRM that integrates cross-channel marketing automation, you’ll be able to use all of your customer insights to inform holistic, personalized marketing strategies across all the channels your customers use, sharing messaging that reaches your customers at the time they’re most likely to engage.
Understanding your customers on an individual level means you’ll be more likely to help them convert and remain loyal to your brand, helping you gain recurring revenue through retention rather than needing to focus heavily on acquisition.