How much money do you spend on marketing to acquire a customer? How much time did you spend working on that proposal to win the bid for that new contract? Do you believe you are maximizing your return on investment of these activities? If not, consider how an artificial intelligence (AI) embedded customer relationship management system (CRM) can help you do so.
Almost every application used in business is becoming embedded with artificial intelligence because AI adds increased insights and speed, making conducting business more efficient. CRM is no different. As the name implies, customer relationship management software helps manage customer relationships and with AI, could be the difference between just acquiring a customer and retaining one. Do you know the difference between a traditional CRM and an AI embedded CRM?
A traditional CRM software stores pertinent data about customers. Data could be obtained through forms or surveys. The software can track marketing campaigns and maintain records of purchases and interactions between you and your customers. They can also route customer service tickets to the appropriate individuals. AI embedded CRM systems take these features to the next level.
AI embedded CRM systems enable you to gather data about your customers beyond what you could amass from a simple form. They do more than give you a record of what customers purchased in the past and when. Some AI CRM software gathers and stores insights about your customers and prospects from their social media and internet activities.
Have you ever realized you have the same customer in your CRM system more than once? An AI embedded CRM system will reduce the redundancy of contacts, eliminating the time you may be spending doing it. Some systems summarize customer sentiments accumulated from emails and product reviews using natural language processing, a subset of AI. Other systems can also record sales calls and then yield a transcript highlighting important details that need action.
The AI embedded systems also use machine learning, a subset of AI, to learn about customers based on previous buying patterns. They create algorithms and run models that score customers based on their readiness to buy. They can predict the optimal medium to communicate and gives the next best action to take. Some systems also allow you to run different versions of the same promotion or message simultaneously to determine which one is more effective and can adapt in real-time. A significant benefit you will gain from using AI is the ability to customize and personalize your messages, something that would be much more difficult if a person had to comb through customer data to determine the right message for each customer type.
If you have not gotten around to upgrading your CRM system to one embedded with AI or have never adopted one, the investment in this technology more than makes up for the time or money it takes to implement. If you’re still not convinced, take a look at the following hypothetical examples below of business operations with an AI embedded CRM vs. those without AI.
An Insurance company attracts new clients for insurance who usually remain customers for an average of 2 years. Customers typically purchase one product; car or home insurance, not both. The company’s goal is to increase the length of time they retain customers.
Strategy using traditional CRM
Insurance Company A uses its CRM system to send an annual survey to its customers to determine their satisfaction level and saves the responses. All customers with a “not satisfied” response receives a follow-up phone call from a customer service representative to increase the likelihood of retaining that customer for another year. The phone calls result in some success in retaining customers, but some customers are bothered by receiving duplicate emails and phone calls.
Strategy using AI embedded CRM
Insurance company B uses its CRM system to analyze historical data of current customers and lost customers, products purchased, and why. It builds models to predict which customers are more likely to switch insurance companies, then scores them to identify who to contact first with a retention strategy. With an accurate assessment of the customers’ characteristics likely to switch, customer service reps’ time and efforts become more strategic and more effective within a shorter period. The conversations are also customized based on customer sentiments accumulated from previous communications and result in increased retention rates.
Company A sends via postal mail and email a 20% off coupon to all of its customers using a traditional CRM. Their CRM system provides a report with open rates, click-through rates, and redemption rates. 15% of the coupons are redeemed. The marketing manager then has to decide whether the investment in this promotion warrants promotion in the future.
Company B uses AI embedded CRM software. They also email and send via postal mail the 20% off coupon, however, they are only sent to the customers the machine learning algorithm has predicted are customers more likely to respond. Each time they send a promotion, the system gains more data, such as coupon value, amount purchased, and frequency of purchase, from which the system can use to improve its predictions about who to target and with which future promotion. By implementing the strategies via AI embedded CRM, companies can create customized messages and promotions for their customers and significantly reduce expenses on ineffective sales and marketing tactics.
Choosing a CRM
When you begin researching AI-embedded CRMs, you will find there is a number from which to choose. Some of the popular ones you may come across are HubSpot, Zendesk Sell, Zoho, and Salesforce. All provide unique offerings. When evaluating which CRM to purchase, consider some of these fundamental factors:
- The number of people in the company that will use it
- The need to be integrated into other applications and the ease of doing so
- The need to upgrade based on your business goals
- The number of customers with whom you’ll communicate and on which platforms
You have invested time and resources to acquire your customers. If you’re selling in a saturated market, it may take double the efforts to maintain them. If your growth strategy includes increasing up-sells, repeat sales, and, in the world of social media, more positive reviews, allow an AI CRM to help you achieve those goals; the efficiency with which it can provide insights is unparalleled.