12 Benefits of CRM Software Every Business Should Know

CRM software, also known as Customer Relationship Management software, has become an essential tool for businesses in today’s competitive market. With the increasing importance of customer satisfaction and retention, CRM software offers a wide range of benefits that can significantly enhance a company’s operations. From streamlining sales processes to improving customer service, this software has revolutionized the way businesses interact with their customers. In this article, we will explore 12 key benefits of CRM software that every business should be aware of, highlighting how it can help drive growth and success.

A CRM (customer relationship management) is a single software platform that allows businesses to manage and monitor customer relationships with both current and potential customers. With a good CRM, your business could save money, resources, and time, but if you find the right CRM for your business’s needs, you’ll save on a hell of a lot more.

In this article, we list 12 benefits of CRM software every growing business should look out for, and explain why choosing the right CRM for your needs is the key to scaling and transforming your operation for the benefit of both you and your customers.

On the fence about CRM? Download our FREE Duanetoops PDF Guide to CRM Costs. But, if you’re ready to learn about the benefits of CRM, let’s dive straight in.

How CRM Software Works

CRM software allows businesses to track customer interactions, store data securely, share information with colleagues, and manage and acquire customer leads.

If you’re struggling to keep track of your customer information or have an ever-growing database, you could benefit from CRM software. No matter the size of your business, automating your processes will inevitably save you money and time.

You can use our free CRM comparison tool to find the best CRM for you, or if you’re in a hurry, our research suggests the following CRM software will fit most business needs.

 

What Are the Benefits of CRM?

If you’re in a business that relies on careful management of customer data, sales opportunities or marketing leads, investing in the right CRM software could make a huge difference to your profits – here are 12 reasons explaining why.

  1. CRM improves customer relationships
  2. Helps understand your customer needs
  3. Boosts customer retention
  4. Develop Increase your sales
  5. Boosts productivity
  6. Helps businesses scale
  7. Improves team collaboration
  8. Increases efficiency
  9. Speeds up internal communication
  10. Encourages smarter business decisions
  11. Provides data privacy and security assurance
  12. Costs less than you think

1. CRM Software Improves Customer Relationships

CRM software is specifically designed to improve customer relationships, and provided you choose the right CRM for your business, your CRM software will do exactly that.

One of the biggest benefits of CRM software is that it holds all your customer information in one place, making important information like your customer’s purchase history and interactions, easily accessible to your agents. This allows your agents to respond to questions almost as fast as your customers ask them, resulting in more satisfied customers and improved customer relationships.

According to PwC, 73% of customers point to customer experience as an important factor in their purchasing decisions (see: CRM statistics), making customer relationship management software all the more important.

2. CRM Helps You Understand Your Customer Needs

Another benefit of CRM is its customer profile. While every CRM has a slightly different interface, a customer profile – a database of customer-agent interactions that groups each customer’s historical data into its own category – is essential.

Customer profiles allow agents to see at a glance any given customer’s service history, complaint history, and any known demographic data. With a CRM customer profile database, service agents can better understand their customer’s needs. This allows them to resolve issues quickly, and recommend new purchases relevant to their purchase history, ensuring your bottom line stays healthy.

CRM customer profiles can be applied across all areas of a business’s customer relations, from sales and support, to marketing and community forums. It’s this holistic, intelligent structure that is one of the biggest benefits of CRM. You already have plenty of data on your customers, but you’ll only be able to take advantage of it if it’s in the right place at the right time.

As seen below in the screenshot acquired by our Duanetoops research team, a customer profile provides all the valuable information that your team might need to interact with a current or potential customer.

monday Lead Profile

CRM customer profiles in monday.com
Image: Duanetoops testing

3. CRM Can Boost Customer Retention

Customer retention is valuable. CRM statistics and data suggest that businesses using CRM software have an easier time retaining customers than businesses without it, which is a huge benefit of CRM. Customer retention is a massive concern for businesses in 2023, but churn rates are often overlooked in favor of customer growth rates. The truth is, even if you’re happy with your operation’s current profits, you must keep your churn rate at or below the rate that you gain customers – otherwise, your business won’t stay in the black.

See Also:  HubSpot vs Salesforce (2023) – Which CRM Is Best and Why?

A benefit of CRM is that it operates twofold; its focus on sales helps bring in customers, but its focus on service helps to retain them. According to Trackvia, CRM usage can increase customer retention by as much as 27%, making it a profitable investment for any business, and one of the reasons why is its internal service module.

A CRM service module offers a central location for service agents to communicate with disgruntled customers in a timely manner. Templates and auto-generated responses can take some of the pressure off as well, which is also beneficial to your team. Bain & Company estimates that just a 5% increase to a company’s customer retention efforts can increase profits by up to 25%, making it one of the most overlooked benefits of CRM software.

4. CRM Develops Leads and Increases Your Sales

Another benefit of CRM software is the opportunity to develop more leads and increase customer sales. Our research (see stats below) found that 94% of customers look to make a purchase from the same source they have previously, so how you nurture and monitor your customer relationships matter.

80% of customers are more likely to make a purchase from a company offering a more personalized experience, and by storing customer data in ways that are helpful to your business, CRM software can accurately help you to map out customer journeys – allowing you to do exactly that.

CRM data profiles also allow you to monitor your customer’s interests, giving you plenty of opportunities to turn cold leads into warm ones, and potentially boost your sales by 29%. A typical CRM will also offer lead management functionality – a way to track and maintain relationships with people who aren’t yet official customers. A database of lead profiles can include relevant context, contact information, and the initial source for each lead.

Through a CRM interface, you can reach leads where they are, allowing you to personalize customer journeys and upsell where you need. Marketing auto-responders can be set up to offer immediate feedback to leads as soon as they post to your website, making it a valuable benefit of CRM to keep in mind too.

As seen in the screenshot below, Zoho CRM includes a “social tab” that lets agents contact potential leads through social media platforms, and Zoho’s Enterprise plan even includes Zia Voice, an AI that predicts the best times to contact leads and when they might be ready for conversion.

Zoho CRM Social Tabs

Social tabs in Zoho CRM
Image: Duanetoops testing

5. Boosts Productivity

Automation is key to improving productivity in any business, and it’s one of the many benefits of CRM software. Most CRM systems will come equipped with heaps of automated features that allow users to reduce admin-heavy tasks, like manually pulling together reports or managing your sales pipeline. This will free up time to focus on other business priorities, like improving customer relationships, retention and driving more sales.

Tasks you can automate include setting reminders, scheduling meetings or calls, and even creating tasks for employees to be assigned when previous tasks are finished.

Benefits of CRM graphic data

6. Helps Businesses to Scale

Automation technology found in most CRM systems could also help to scale your business, which is another great benefit of CRM software. If your team is using a spreadsheet to collect customer data and information, we don’t need to tell you that your potential to grow and scale your business is limited. Manual data collection can only go so far, and if your business is scaling at speed, you’ll need to automate your processes efficiently.

Another benefit of CRM software is that most systems in 2023 are cloud-based, making it super easy to scale up your processes in line with your business’ growth. Where traditional software models would require business owners to install gradual upgrades in order to increase their capacity for managing customer data or sales information, contemporary cloud-based systems will allow your business to upgrade your systems faster.

7. Improves Team Collaboration

In addition to improving your customer relationship, another benefit of CRM software is that it is designed to improve team collaboration.

Thanks to features like file hosting and collaborative documents, each service agent can use their CRM account to access, comment on, or message each other essential reports or videos. This can then be exported and downloaded in a variety of formats.

If your business operates in the field as well as from a home base, you could also benefit from CRM integrations specifically designed to help service agents stay on top of changes in their workload though internal company messaging.

See Also:  Best CRM for Sales

8. Increases Efficiency

Businesses interested in increasing team efficiency will also benefit from CRM software. A good CRM system is designed, not just to collect data and sort into useful profiles, but to give service agents that extra nudge that helps them decide what move to make next.

One CRM feature that helps suggest actions to service agents is the design of the user interface itself. The typical CRM divides an agent’s dashboard into a journey that either converts a new lead into a customer, or a past customer into a higher subscription tier, moving their profile from one section to the next – mirroring their customer journey. This way, the agent sees their dashboard not as a static collection of customer accounts, but as a fluid, constantly shifting customer relationship.

Another feature that’s increasingly common in CRM software is an AI assistant. For example, Salesforce offers Einstein analytics, an AI that can be layered across all of the Salesforce CRM modules to directly speak to agents and offer data-driven insights when needed. Should you end a ticket after a one-on-one response, or should you consider reaching out to a targeted group of customers who might face the same issue but haven’t reached out about it yet? With the right AI, agents can be prompted to take a more proactive approach to keeping customers happy.

As you can see in the screenshot below, Salesforce effectively organizes data and suggests information to make your team more efficient. The end result is better productivity for your agents’ day-to-day activities. They won’t be wasting brainpower pondering what next step to take – they’ll be busy taking it.

Salesforce Cases

Case details in Salesforce
Image: Duanetoops testing

9. Speeds Up Internal Communication

Most CRM software offer an entire internal social network that allows service agents to post to a variety of channels. This network also helps agents quickly contact the right individual colleague, or the right team to address a specific comment or question. Salesforce offers an internal social platform, called Chatter, which can be pulled up within seconds from anywhere within its CRM interface.

It’s this infrastructure that makes a CRM beneficial to a company. In addition to strengthening your agent-customer relationships, it structures and strengthens your agent to agent, and agent to manager relationships, as well.

This particular benefit of CRM is why all C-suite executives should be familiar with their company’s CRM software. While they likely won’t need to contact customers directly, executives do need to remain both accessible to their employees and aware of how their company’s culture is evolving.

10. Helps Businesses Make Smarter Decisions

The core function of a CRM is to organize data, whether through a customer profile database, through communication channels for leads, or through internal collaboration tools. But, it’s the sum of all that data that reveals another benefit of CRM – the insights to make smarter business decisions.

With access to a collective resource of information a company might not otherwise have known, the insights it can reveal could lead to smarter business decisions that will shape the entire future of your company.

Process tracking reports can be generated to highlight the efforts of individuals (leading to decisions about who to promote and who to let go) or entire teams (leading to decisions about which teams to expand or which areas a team should improve in). In extreme cases, a company may choose to pivot to a new business model after noticing a particularly high success rate in a sector that isn’t their core business model, but should be.

It’s worth noting that this is only a benefit if you allow it to be. A CRM can deliver the best practices and insights to you with a bow on top, but someone in a leadership position will need to recognize and act on them in order for this benefit to guide your company into its next phases.

Mass communication features are covered by most CRMs as well, from email marketing campaigns to social media scheduling, and feedback can be folded into reports, allowing managers to shift strategy decisions at a high level.

11. Provides Data Privacy and Security Assurances

One of the benefits of CRM software is that because they’re designed to hold all of your customer data, they must comply with the data protection laws of the regions they operate in. This makes it easier to track and update information, as and when you need to, to ensure your customer data is GDPR compliant.

For instance, with a CRM, it’s easier to manage which customers have consented to be contacted with marketing campaign emails. Considering the fines handed out to companies who violate data protection laws, this makes a CRM program a shrewd investment.

As well as helping you comply with data protection laws in the states, CRM software can also provide extra security assurances in a world where cybercrime and data theft are only getting worse. Ransomware attacks grew by 158% between 2019 and 2021,  in just North America alone, with roughly one-quarter of all global ransomware attacks directed at businesses and individuals in the United States.

See Also:  Zendesk vs HubSpot – Price and Features Comparison

Storing customer data in CRM software, like the kind in the screenshot below of HubSpot’s contact list, with sufficient security provisions is a must, as is choosing a trusted CRM provider with a good track record when it comes to cybersecurity. A secure CRM provider is much, much more secure than storing your data on, say, a spreadsheet on your computer.

HubSpot Free Contacts

Contact list in HubSpot
Image: Duanetoops testing

12. CRM Software Costs Less Than You Think

Most CRM services charge per user per month. The lower priced plans tend to start anywhere from $20 to $80 per user per month, although some more stripped-down services start even lower – like Apptivo, which even offers core CRM features starting at just $8/month. However, more comprehensive, enterprise-level plans tend to hover around the $100 to $300 per user per month mark.

Some CRM software providers offer a free CRM plan which you can try for yourself, including HubSpot’s Free CRM plan. Some of HubSpot’s core CRM sales features are reserved for its premium tiers, but pricing is competitive and there’s no obligation to upgrade.

In all cases, the benefits of CRM outweigh the cons, as they spread across all aspects of any consumer-facing business. If you currently don’t operate with a CRM software subscription, upgrading to any of the top contenders in the market will almost certainly save you much more than you’ll spend. If you’re worried about the cost, you can use our free CRM comparison tool to find the most affordable CRM software for your needs.

CRM Benefits Stats

About Our Research

Why do we know so much about the benefits of CRM software, you ask? Well, here at Duanetoops, we’ve done a lot of research on this kind of software to help small businesses make the right decision for their team. Everything from VoIP services to password managers have crossed our desks in service of more comprehensive understand of what works best for which companies.

For CRM software, we take a lot of data into account, including pricing, features, customizability, ease of use, scalability, and help and support options. We found these to be the most valuable aspects of CRM software to consider for your particular business. On top of that, we’ve included actual screenshots from our own experience with the platforms, acquired through in-depth research and, of course, free trials.

If you want to learn more about how we rate and rank software, and how we establish the benefits of CRM software, take a look at our research guide to learn more about our in-depth process.

Frequently Asked Questions

CRM (Customer Relationship Management) software is a digital business resource aimed at organizing and automating a wide range of daily processes at your company. You can store and analyze customer data, all while engaging with them to retain loyal users and attract new users.

Typically, CRM software is priced with a per user per month model. In that case, the average starter CRM plan can cost between $8 per user per month to $30 per user per month, with enterprise level plans costing as much as $300 per user per month.

Our research shows that Zoho CRM is the best option for small businesses, thanks to its plentiful features for sales, marketing, and service, all in an easy-to-use interface at a reasonable price. Some other options are Freshsales Suite, for its robust sales features, and monday.com, for its serious customizability.

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That’s a wrap on “ 12 Benefits of CRM Software Every Business Should Know ” We hope you’ve found a trove of useful insights and fresh perspectives. Your opinions and ideas matter to us—join the conversation below and share your take! Hungry for more tech insights? Dive into our diverse collection of articles where innovation meets practicality. Discover More CRM Softwares.

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