CRM, otherwise known as Customer Relationship Management software, is far from a new term.
The early idea of CRM's began in the early 1970s but the first breakout year was in 1982 when Robert Kestenbaum introduced the idea of database marketing which collected key customer data then applied statistical methods to analyze it.
By the early 90's, the industry conglomerates such as Siebel, Gartner, and IBM and had thrown their hat into the CRM ring and throughout the 90's as the industry sprinted full speed ahead, one key player emerged: Sales Force.
Going public in 2014 with the ticker symbol 'CRM', Sales Force today does nearly $7 billion per year in revenue, and while they are the biggest, they've left gaps in the market which has resulted in a lot of emerging CRM companies diving into the industry.
According to Angel List, there are 1,604 CRM companies today, and that's just what appears in their database, so it's safe to assume there are likely many others. This brings up the question, why? Why are there so many companies launching to solve the problem that CRM's are meant to solve?
The answer, of course, is partially because they are divided by industry verticals but it's also because despite their being so many solutions out there, there are gaps between what companies are offering and what sales teams, managers and executives want out of their CRM.
Looking at the data, here are the three statistics that highlight the problems users have with the current CRM solutions along with experts who are already solving them.
Productivity: Sales Reps, Not Selling
A report published by Hubspot in 2015, revealed that Sales Reps are only actually selling one-third of the time. So, where is their time actually going? According to the report, 31% of their time is spent searching and creating content which is an understandable statistic but the concerning statistic is the fact that 20% of their time is spent managing the CRM, doing admin work, and reporting.
Simplifying this data, former Microsoft executive and CEO of Smart CRM startup Komiko explains why this is such a big issue, "Existing methodologies rely far too much on manual data entry and fail to gather enough data to accurately assess the level of engagement with and by the customer. If a customer or prospect suddenly stops responding to email inquiries and declines repeated meeting requests, everyone knows it's a bad sign for the health of the relationship."
CRM firms like Komiko are aiming to solve this problem by creating more cloud-based solutions that reduce the amount of time reps waste on data enrichment to free their time up to do more actual selling. One such approach includes mining data from existing cloud-based platforms like email. Howard adds, "The next five years will see the true power of cloud computing data mining, machine learning, search, revolutionize the space."
Social at the Core, Not as an Add-On
Everyone knows social media is a big deal but if you still aren't convinced or think maybe this is just a "consumer thing", a Linkedin study revealed that 72% of B2B buyers social media to research before buying.
The combination of social and CRMs started several years ago when Sales Force first made waves with their acquisition of social media performance and sentiment company Radian6 and again when they acquired Buddy Media in 2012. This lead to the rise the "Social CRM" which Jacob Morgan, coauthor of "Twittfaced," explains in detail
"Social brings a new element into CRM because now instead of just dealing with data and information we are dealing with conversations and relationships. These conversations and relationships take place not just from company to consumer but also from consumer to consumer. Think of Twitter as a simple example. Let's say you are a large brand on Twitter such as Southwest Airlines. You are building relationships with your followers but you also have the ability to build relationships with and listen to (and engage) customers that are having conversations about you."
True and Accurate Forecasting
According to CSO Insights research, 85% of organizations struggle to effectively forecast sales, due to various problems ranging from tech to human influence. Of those that deal with this issue, 34.1% cite that they lack the predictive data needed, and an additional 30.5% admit that the information they do have isn't always accurate.
Lacking forecasting data is like setting out into the backcountry without a map and compass, but many companies invest significant portions of their budget in sales intelligence technologies that they fail to use to their full potential. Most of these platforms flounder when implemented due to their complexity, with sales managers and key customer success partners giving up before fully leveraging the software.
The path forward needs to include a solid emphasis on what data insights can be gleaned from every information source available. Mining data from email, calendars, client contracts, and behavioral information will help provide the context that is necessary for creating more accurate forecasts.
The Future: What lies ahead for CRMs:
The good news? Companies are beginning to realize that sales intelligence needs to rely more on data, which is driving them to take better partners when it comes to CRM platforms and solutions.
Being discerning is key when considering CRM implementation, and many businesses are looking to CRM providers that offer leaner, easier to use, and more data-driven software. As the industry shifts to meet this demand, it can be expected that innovative providers will reduce the amount of time it takes to implement CRM, while increasing the user experience to help drive better adoption throughout the enterprise.
See our selections for Best CRM Software.