The Role and Types of CRM (Customer Relationship Management) in eCommerce

Here is everything you need to know about eCommerce CRMs to ensure business success and growth.

Does CRM strategy matter for eCommerce businesses? Before we answer this question, let us share some statistics. Over 91% of businesses in the US with more than 10 employees have a CRM, and you get nearly $9 for every $1 spent on a CRM system. These statistics may be surprising, but a fair explanation of how important CRM in eCommerce businesses is.

However, if you are still contemplating what benefits Customer Relationship Management (CRM) in eCommerce can bring to your business and whether or not you should have such a system in place, this article is for you.

In this article, we are going to delve deeper into CRMs (particularly, eCommerce CRMs) and their role in eCommerce. However, before discussing any of it, it is crucial to understand what a CRM means so you can relate it better to your eCommerce business. Hence, let us get started by explaining CRMs in general.

What Is CRM (Customer Relationship Management)

Traditionally, CRM tools are software that helps businesses track and manage their customer interactions across various platforms. However, the functions of a CRM have evolved over the years to cover a diverse range of functions.

For example, in addition to managing customer relationships, CRM can help you simplify lead nurturing, forecast sales better, automate data entry and report generation, and a lot more. The following image shows some of the areas where you may find a CRM helpful.

But why do you need a CRM in an eBusiness?

To answer this question, first, we need to explain what an eCommerce CRM is. Hence, let us understand the same in the following section.

What Is eCommerce CRM

Where the prime goal of a traditional CRM is to help businesses establish adequate interaction with their customers to satisfy their needs by providing the business with customer profiles with detailed purchase and outreach information, eCommerce CRMs are a step ahead.

eCommerce CRM, in addition to being a software or central location that stores customer information, accounts, details, and leads, boasts analytical features that help you improve your customer experiences and sales. Some of the crucial insights a CRM offers e-commerce business include conversion rates, subscription opt-ins, customer click-through rates, products customers find interesting, and much more.

However, analytics is not only what a CRM has to offer. In addition to analytical, there are operational, collaborative, and strategic CRMs. Let us understand each of these CRM in detail.

Types of CRM in eCommerce

Below are the CRM types you can find for an eCommerce business.

1. Operational CRM

Operational CRMs are systems designed to automate and minimize repetitive tasks to ensure streamlined business processes. It helps small businesses (or businesses with limited resources) to manage their marketing, sales, and customer retention better. Some examples of operational CRM include Salesforce and HubSpot.

2. Analytical CRM

As stated in the former paragraphs of this article, a CRM helps gather data and information to make informed decisions to accelerate your business growth. These CRMs that offer such insights are known as analytical CRM. Insightly and Zoho are some examples of analytical CRMs.

3. Strategic CRM

A CRM that helps you understand customer needs and preferences is known as a strategic CRM. These CRMs allow you to build long-term customer relationships and loyalty by using data analysis and customer insights.

Primarily suited for businesses having recurring customer interactions, these CRMs leverage market trends, customer data, and analytical tools for precise customer segmentation, customer data management, and customer engagement. HubSpot, Capsule, Pipedrive, and Zoho are some of the best strategic CRMs.

4. Collaborative CRM

CRMs that focus on coordination among various departments in a company and teamwork are called collaborative CRM. These CRM software ensure a seamless flow of customer information and insights across different departments for a unified customer experience.

In addition to fostering internal communication within the organization, these CRMs also help you establish a seamless connection with external parties, such as partners, suppliers, and distributors. Some of the best CRMs for collaborative purposes include Dynamics 365, Copper, and Sage CRM.

Also know: Best Ecommerce Website Builder for Small Businesses

That was all about CRMs and their types. Now comes the burning question.

Why do you need a CRM or Customer Relationship Management in eCommerce?

Let us answer this question by explaining the role a CRM plays in eBusinesses.

Role of CRM in eCommerce Businesses

CRM in eCommerce plays a pivotal role in helping an eBusiness succeed and grow, as explained in the following points.

1. Access to complete customer history

Imagine a situation where an eBusiness plans to launch a new product specifically for a certain type of customer group. Which category of potential customers would be interested in these products so that you can market the products to them? Well, you would have to look at the purchase history and past customer trends. Now, what if the customer history is not available at a single easy-to-access location? It would be a hassle to gather it. This may be why a CRM like Salesforce is so popular.

It stores and helps you access your customer history so you can analyze their wishes and understand how they would respond to a new product or service. In other words, it allows you to determine the ideal customer profile by offering a comprehensive customer view.

Moreover, customer history analysis can help you decide what products/services to launch next, determine your top-selling products, identify the periods when your sales were at the peak, and answer a lot of other questions (for example, which prices led to the biggest purchases, etc.)

2. Creation of a personalized marketing strategy

Personalized marketing strategies are known to result in higher conversion rates, as high as 94%. Hence, CRMs help you personalize your marketing messages to fit the expectations and needs of your customers. You can collect and analyze past purchase information, and details about the customer’s location, demographics, and preferences so you can customize your marketing strategy to various customers and boost your response rate.

For example, the analysis of past purchases can help you email customers (personalized with their name) with recommendations of the products they may like the most. Moreover, it can help you determine the best channel to contact your customers for new offers. For instance, some customers respond more positively to emails than an SMS, a CRM helps you keep track of it all.

3. Improved efficiency through automation

You can automate a lot of tasks in an eCommerce business to increase efficiency. Customer relationship management is among the top examples of such tasks. Tasks such as tracking and logging new sales across various channels, capturing customer information, recording purchase history, etc., are time-consuming and resource-intensive.

Hence, automating all these repetitive tasks through CRMs can bring efficiency to business operations, make all the information readily available, and ensure no time delays in executing various tasks.

4. Effective team management

Team management and internal resource allocation are among the top challenges for any eCommerce business. CRM software helps in effectively managing teams and internal resources by allowing you to categorize your customers according to certain criteria.

For example, you can allocate your key managers to customers who always purchase the most expensive products so you can always be service-ready for them.

5. Better customer satisfaction

Customer satisfaction is any business’s backbone. Hence, CRMs help improve customer support to ensure your customers remain satisfied. Through a CRM system, you can ensure customer problems are resolved quickly and the support team provides the best possible solution to the customers based on their preferences, purchase history, and other relevant information.

6. Generate more sales

Through CRMs, you can streamline the sales process, automate various tasks, and boost your sales and productivity by analyzing the sales data in a single place. Moreover, CRMs help in identifying potential customers, generating leads, managing campaigns, accessing and analyzing data, and devising programs to generate sales and retain customers.

Also know: Best Video Analytics Tools For Businesses

Summing Up

So, after going through the types and roles of CRM in eCommerce, we can safely conclude that it is imperative to the success of any eBusiness. Hence, investing in a CRM system is a smart move to accelerate your business growth by gaining an edge over your competitors and maintaining strong customer relationships. However, if you have any questions or concerns, feel free to reach out through the comments sections so we can address your queries.