CRM Might Be More Important to Your Business Than Phones
As a small business, it can be difficult to determine when and where to spend your resources. This is especially true for companies that rely heavily on technology to enable and monitor sales processes. However, it's becoming pretty clear—thanks to several recent enterprise software adoption studies— that, at minimum, your company should invest in customer relationship management (CRM) software.
Would it surprise you to learn that 40 percent of salespeople still use spreadsheets and email to store customer data? What if I claimed 22 percent don't even know what CRM is? Well, according to a recent report from Hubspot, both figures are (shockingly, annoyingly) true. For those of you who read PCMag on a regular basis, you're probably aware of the amazing things CRM vendors are doing to turn basic customer interactions into powerful data that can be harnessed for improved selling. For example: Salesforce's recent big investments in deep learning, machine learning (ML), predictive analytics, natural language processing, and image processing tech, spawned the company's Einstein artificial intelligence (AI) tool. Einstein will enable customers to process billions of data points, repetitions, and images to help improve workflow. The tool learns from customer usage to recommend improved workflows that are specific to each organization.
Salesforce isn't alone here: Zoho recently added an AI-based virtual assistant to Zoho CRM. The feature, Zoho Intelligent Assistant (Zia), is an automation engine designed to deliver unprompted, data-based recommendations to sales staff whenever they are using Zoho CRM. Limited to Zoho CRM, Zia is engineered to detect system usage anomalies, suggest optimal workflows and macros, and advise salespeople on when to contact a prospect. Beats using a spreadsheet and an email, doesn't it?
You're Being Left Behind
Fortunately, most companies have gotten the memo. A recent study conducted by Cite Research on behalf of SugarCRM revealed almost half (49 percent) of companies spend at least $2,000 per year, per salesperson on sales enablement technology. Eight percent of companies spend at least $5,000 per year, per employee on sales tools. To take this from another perspective: only 20 percent of companies spend less than $1,000 on sales technology per year, per employee.
"The adoption of CRM technology held as a constant for all sizes of companies and through the spending curve, said Clint Oram, CMO and Co-Founder of SugarCRM. "To make money you have to spend money. You have to equip your people with the right tools and tools that are effective."
The report, which surveyed 400 business professionals at the director level or above, revealed that the greatest barrier for businesses to adopt new technologies is cost (48 percent). Meanwhile, companies also cited security (36 percent) and technological complexity (34 percent) as barriers. Fair enough.
The survey focused on a wide swath of technology, including CRM, videoconferencing, and collaboration suites, but it also factored in everyday items like smartphones and laptops. CRM was the most-used sales-enablement technology provided by companies to sales staff (69 percent), even more than smartphones (59 percent) and laptops (58 percent). When asked to rate tools by their effectiveness to help sales staff, CRM, laptops, and smartphones were ranked first, second, and third in terms of importance, respectively. Yes, you read that right—CRM is more important to most companies than laptops and smartphones.
"I've spent my entire career in the space and that hasn't always been the case," said Oram. "The market recognizes this business problem I've dedicated my life to. The CRM space got well-defined in the early 90s. [As a result,] a whole generation of business leaders have learned to leverage this technology to grow their business."
Despite respondents' belief that CRM was the most effective tool for enabling sales professionals to conduct business, the survey also revealed companies were more interested in the ways CRM tools improve customer experiences than they were in making salespeople sell better. Sixty-two percent of respondents said the customer interactions delivered as a result of CRM tool data was the most important factor when choosing a CRM system, whereas only 38 percent of respondents chose improved selling as the number one consideration.
"We're at an inflection point in the industry where the way we think of CRM yesterday is different than how we'll think about it tomorrow," Oram said. To combat some of the issues companies have with adopting CRM, namely complexity and cost, Oram said it's crucial that his company and CRM vendors as a whole, "strip away the bloatware and give [customers] the core set of features that help people get their job done."
Of those respondent who had already adopted a CRM system, 25 percent use Salesforce, and 18 percent use Oracle. This market share breakdown is in line with recent Gartner Research data, which claims Salesforce owns roughly 20 percent of the CRM market. Only 5 percent of respondents use SugarCRM, which is currently working on adding predictive analytics and machine learning techniques to its SugarCRM Relationship Intelligence products in order to evaluate large data sets to find patterns, prioritize opportunities, identify issues and make intelligent recommendations. Gartner anticipates CRM as a whole will generate $37 billion in 2017, becoming the most lucrative enterprise software category, surpassing enterprise resource planning (ERP), which is expected to generate only $34 billion in 2017.
If you haven't already invested in CRM, use the comments section below to tell us what's stopping you.
This article originally appeared on PCMag.com.