What is a CRM database?
Over time, CRM systems have evolved and now have advanced CRM databases that can be connected to tools so that companies can address their customers in a better and more personalized way.
But what is the definition of a CRM database? What should it contain and what requirements must be met? Answers in this article!
What is CRM?
CRM stands for "Customer Relationship Management" and refers to all strategies, methods, tools and technologies for improving the customer experience, customer satisfaction, customer loyalty and service in companies.
In most cases, CRM refers to CRM software or a CRM system - a tool that supports companies in managing marketing, sales and service.
CRM software ensures that companies can focus on the relationships with their customers, colleagues, suppliers, etc. With a professional CRM, it is much easier to find new customers, gain their trust, provide qualified support and offer additional products or services, so-called cross-selling and up-selling, throughout the business relationship.
CRM database: Definition
A CRM database collects every customer interaction in a central area and then makes all this information available to the company in a customizable dashboard.
To do this, CRM databases rely on powerful tracking and data analysis tools that automatically collect information about customer purchasing behavior.
With such an application, support staff no longer need to log into multiple systems and copy account numbers into different software to obtain basic information about a customer. With CRM, all data created about customers in different tools, accounts and systems is automatically stored in the CRM database and is easily accessible to all team members.
Content of a CRM database
A CRM database collects all data about your customers in a CRM. But what data should be collected?
- The name, title and email address of a contact or address for video conferencing;
- The names of a customer's children or pets, favorite hobby, birthday or other personal information to keep the relationship friendly;
- The lead scores and sources of leads, i.e. the point of contact between the customer and the company (website, phone, social networks, email, etc.);
- Date of the last conversation and content of the conversation;
- Their last visits to the website or other activities with the brand
- Purchases or orders a customer has made and how much they have spent, etc.
CRM database: advantages
The strength of a CRM system lies in its ability to deliver the right information from a trusted source to the right customer at the right time. CRM databases that store extensive data therefore have several advantages:
Personalized user experience
An efficient marketing campaign requires important information about the target group. Such insights result from detailed, integrated and controlled CRM data. A CRM database can provide a single source of information for each customer or prospect, allowing marketing teams to personalize their approach and design of the experience to each individual.
Data protection and appropriate access
Customers and regulators expect information to be handled carefully to maintain privacy and access to their collected data. When a customer learns of a data breach, the company must not only compensate for the lost data, but also restore a more positive relationship.
Therefore, the company needs to know what customer data it holds and how that data is handled. The challenge in this sense is compliance with regulations such as the General Data Protection Regulation (GDPR). Failure to comply with such regulations can result in heavy fines.
Nowadays, CRM databases are powerful enough to comply with these regulations: from start to finish, you can track all customer data to ensure their privacy is protected.
Optimized sales process
Successful CRM solutions are adept at managing contact information. Sales reps and marketers can have access to all customer data in one place while on the go (such solutions are also called " mobile CRM").
Capturing real-time customer data requires a CRM database that can handle multiple data streams and integrate all this data efficiently. However, it is also important to regularly update and, above all, maintain this database.
Requirements of a CRM database
Maintaining and updating the CRM database
A CRM database must be constantly updated, otherwise it will quickly become unusable. Regular maintenance of the database is therefore necessary. The following can be identified
- duplicated information,
- outdated or non-updated data,
- records or documents that need to be cleaned up.
A poorly maintained customer database leads to poor targeting and incorrect segmentation of customers. This directly impairs the effectiveness of commercial prospecting.
To avoid this headache, CRM software offers optimal and innovative database management. Such a solution is based on a collaborative way of working: The B2B database is updated and fed by the users themselves, e.g. through the business cards they collect in the course of their activity or by filling in online forms.
Qualified enrichment of customer data
Managing a customer database efficiently also means keeping it "clean". Otherwise, any cleansing and duplication detection measures will not be very effective. Segmentation and targeting of potential customers will be inaccurate. Therefore, they need to be enriched with qualified and targeted data to optimize customer data management.
Article translated from German