What is customer relationship management (CRM) and why is it so important in the logistics industry?
CRM helps companies with a wide range of activities, from creating profiles on prospective customers and updating customer lists, to scheduling appointments, and managing communications between clients and businesses. 84% of companies claim that a CRM system is beneficial in determining the quality of leads.
To put it simply, CRM is the use of technology to acquire, enhance, and retain customer relationships.
Many companies are jumping on the CRM bandwagon, last year CRM usage increased from 56% to 74%. This means that over 90% of businesses with over 11 employees now use CRM, with 74% stating that implementing this process has improved their access to customer data.
This article will help you understand what exactly CRM is and why it’s necessary for logistics companies.
- An Overview of CRM
- How CRM Improves your Business
- Why is CRM Essential in Logistics?
- Strategies for Implementing CRM in Logistics
- The Future of CRM
An Overview of CRM
CRM is a technology that manages and organizes your company’s relationships and interactions with your customers and prospective customers. The software allows your employees to store all information regarding customers and customer interactions which can be accessed by employees in different departments.
There are three areas in which companies can interact with customers. Front Office Contact is direct contact employees have with customers. This includes phone calls, emails, IM, and face to face communication. Back Office Operations are processes that are used to facilitate front office contact. This includes finance communications, marketing, customer billing, and advertising. Finally, business contacts are the way employees interact with customers and suppliers through networking. This may be at networking or industry events, or trade associations.
How CRM Improves Your Business
CRM creates value for customers and the company over a long period of time.
When a customer values the customer service they are less likely to look for alternatives. CRM helps companies gain a competitive advantage over competitors that supply a similar product or service. Relationships should be built with customers that are likely to provide value for services.
If companies spend time building relationships with customers that provide little value this may waste valuable time and resources.
The transportation industry is highly competitive, customers are highly selective about their providers and if they are unhappy with your service they will look at your competitors. If you have a robust CRM solution, this will help you understand your customers and their needs and expectations, through successful marketing campaigns, retaining valuable customer relationships, and encourage unstable ones to be more loyal. Customer satisfaction and loyalty results in growth and sustained profitability for your company.
Why is CRM Essential in Logistics?
If you are moving hundreds or even thousands of shipments of freight every single day, it can be easy to forget that your customers have other options when it comes to providers. Having an inconsistent service, and not maintaining close relationships with customers may see a drop in customer returns. Growing industries such as logistics and transportation are fuelling global CRM analytics market growth.
It is essential to stay in contact with the right connections. Implementing CRM allows you to centralize your data and allows your team to access a thorough profile of your customers. Work on building value with your most loyal customers and create opportunities to attract unstable and potential customers.
If you want to understand what the future will look like, you must look at previous years. In 2019 there was increased use of CRM on mobile phones. From this data, we can predict an uprise in CRM on mobile devices.
Last year, where did your most profitable leads come from? How many calls did it take before that opportunity became a reality? This data is crucial to help your team utilize their time calling the right prospects and taking the correct steps to continue and achieve further success.
Quality Over Quantity
Cold calls can be a long and monotonous process that often results in little success.
CRM helps track these conversations for potential coaching opportunities. Having a clear evaluation of the outcomes of your cold calls will determine whether the time is being properly utilized. If you are seeing a number of unqualified leads, then it’s time to change the way things are run.
Proper training is required to have an efficient team. Have employees demonstrate what they do to you so you can determine what changes can be made to add value. Working closely with your sales representatives by discussing different strategies and making the effort will help motivate and allow for creativity to take over your team and improve your business.
Strategies for Implementing CRM in Logistics
So, how can you successfully implement CRM? There are a number of approaches you can apply to your business model.
Set Your Goals
If you want to successfully implement a CRM strategy you should identify your company goals. Once you know these goals you can decide the best approach to accomplish them. Breaking your goals down into smaller achievable projects with a clear approach will help you reach bigger objectives. You should allow yourself flexibility and revisions while reaching your main goals.
For logistics, there are 4 goals that your company must try and accomplish. This includes increased efficiency, improved customer service, increased sales, and improved relationships with customers.
Prioritize Your Customers
While it’s common for businesses to want to treat all customers equally, this is not always possible to be successful. Returning customers are often much more valuable and on average spend nearly double than new customers. The definition of what makes a customer valuable changes from organization to organization, so it’s up to you to identify the traits you most look for in a buyer.
Communicate With Your Team
It’s essential to involve your staff in every step of the strategic process. While your CRM can manage large amounts of data, it will be up to your employees whether your goals are met. Involving everyone in the business helps them internalize objectives and gives them personal ownership over the direction the company takes. Invested employees can integrate new policies and technologies to benefit everyone.
Implementing new policies and technologies too quickly can result in internal rejection and a lack of productivity from employees within the company. While there may be pressures to introduce a lot of changes to reach goals, this will actually have a negative impact on your business. It’s important to gradually introduce new CRM policies.
Evaluate and Improve
Every business is unique, and therefore it’s impossible to find one CRM strategy that will suit every company. Your company must be willing to accept this and reevaluate your approach if something isn’t working as well as it could me. Knowing what is ineffective is nearly as valuable as knowing what is effective, so take this as an opportunity to learn about your weaknesses.
The Future of CRM
With CRM predicted to reach $81.9 billion by 2025 it’s important to see what technological advancements we can expect from this field. Here are our top 3 CRM trends to look out for. If you’re interested in reading more about future trends for freight forwarding read this article.
CRM trends are moving towards the ability of big data and customer data platform software to collect and analyze data in several ways, from marketing campaigns to social media. Advanced CRM software has begun to make a connection between big data and strategies to deliver accurate data-driven insights of their customers. Artificial intelligence for analytics will enhance the capabilities of CRM to offer real-time insights on customer behavior and predictive analytics.
A Better Customer Experience
A huge improvement in customer experience can be expected. The most successful CRM systems have a more user-friendly interface with easier and simpler access to data. As the use of CRM becomes easier companies can focus their attention on providing a better personalized and improved customer service.
The Younger Generation
Millennials have started to take over the workplace and CRM users have begun to shift to a younger generation of workers. 28% of Millennials believe that the use of CRM is critical to succeeding, compared with 18% of Gen X and 9% of Baby Boomers. The main reason for this may be because most businesses today center around technology.