The story of a sales rep fighting with their CRM to produce results isn’t new. Existing CRM solutions can be clunky. It’s not the sales reps’ fault the software is cumbersome and difficult to understand. Rather than being built for high-volume repeat sales, most CRM systems were designed for service and SaaS companies.
Here are four symptoms you may be using a “bad” CRM – one that doesn’t help the sales team do their jobs:
1) Your team rarely uses the CRM.
Sales reps want to make informed pitches and maintain a positive relationship with customers. When a CRM doesn’t help a sales rep, its value for the rep quickly erodes. When sales reps can’t rely on a CRM to give them useful insights and direction, they will quickly lose confidence in the tool.
Some CRM systems require more diligence and time to enter and update data than reps have available to them. It’s no wonder that sales reps quickly stop seeing the value in taking time to haggle with a clunky piece of technology. And the few reps that might make an effort? They probably won’t be updating the information consistently. Inconsistent updates create unreliable data.
This lack of confidence not only hinders the reps but also damages the distributor. Bad CRMs reduce ROI and feed into a vicious cycle where data quality worsens, and the tool slowly loses all value.
2) Missed sales opportunities
Relying on poor data and an unhelpful CRM can lead sales reps to target either the wrong types of customers or pitch existing customers the wrong types of products, both of which are missed sales opportunities. As a result, sales reps end up depending on a tool that’s ultimately impeding their jobs — and the distributor’s bottom line.
With the help of artificial intelligence (AI), reps can be directed to prospects that most warrant their attention. AI offers predictions based off of previous transactions and customer history. These predictions provide insight into what customers will buy, when and how often, and where they’ll most likely make their purchase.
Reps can leverage this information to make more informed pitches as well as upsell and cross-sell products. This insight also ends up adding value to the customer experience.
3) Stagnant growth with existing customers
One of the most profitable opportunities a distributor has is to grow sales with existing customers. But without an effective CRM, sales reps are flying blind. They’re missing opportunities to grow wallet share.
With buying and shopping data from inside sales, outside sales, ecommerce, customer service, marketing and counter sales, an AI-powered CRM can give your team visibility into a customer’s entire history with your company.
For example, conversations can move from “Do you need anything?” to “I noticed you’re buying X from us but have never purchased Y, a complimentary product. Can I send you some information on Y and how they relate to X?”
4) Increased customer churn
A high customer churn rate can result from an unhelpful CRM system and reps going after the wrong customers. Other causes of churn include missing at-risk customers, potential problems with customer service, poor user experience or buying products across siloed channels.
An AI-powered CRM can improve customer retention by empowering sales reps with valuable insights. For example, reps can be alerted to at-risk customers who are due for a reorder or haven’t purchased recently, then follow up accordingly.
Keeping customers happy drives long-term profitability. According to the book Leading on the Edge of Chaos, a 2% increase in customer retention has the same effect as decreasing costs by 10%. This is because it costs less to maintain a strong customer relationship with them than it is to attract a new one. Further research from Bain & Company shows increasing customer retention rates by 5% increases profits by 25%.
Successful distributors leverage AI to increase the profitability of their CRM
The costs of having the wrong tools in place can be steep: missed sales and lost customers. Existing solutions are not distributor-friendly because they weren’t designed to accommodate a high volume of repeat sales, high SKU counts or multiple channels. CRMs aren’t necessarily bad; it’s just that their full potential has never been realized.
Distributors need an AI-powered CRM designed for their businesses and sales reps want to use, which looks different from existing systems. With AI, CRMs can move from a maligned technology in distribution to one embraced by every level of an organization.