Customer Acquisition Cost or CAC is one of the most important markers of success for a business regardless of size and shape. Representing the amount of money required to acquire a new customer, the ability to reduce it in a hyper-competitive business environment is extremely important. CAC is different for different industries, but the quest to reduce it is common to all of them. For instance, the average CAC for the SaaS industry is $702, while that of B2B companies is $536 and that for eCommerce businesses is $70.
Customer Relationship Management (CRM) software is the most effective tool when it comes to reducing CAC. The data and insights it provides can help businesses target high-value prospects and nurture the leads more effectively and thereby increase conversions.
Let us explore strategic CRM tactics that can help slash customer acquisition costs:
1. Identifying and Targeting High-Value Prospects
The ability to sift through prospects quickly and target the most high-value prospects empowers a business to focus its marketing and sales efforts on the ones that are most likely to lead to a return on investment or ROI. CRM software can help these zero in on high-value prospects by analyzing customer data encompassing their demographics, purchase history and online behavior. By drawing up an ideal customer profile, a business can focus its marketing and sales efforts extremely efficiently.
2. Efficiently and Effectively Nurturing Leads
Identifying high-value prospects is an important first step. The next important step involves nurturing them through the sales funnel by forging relationships with prospects by providing them with valuable content tailored to address their concerns and pain points.
CRM software is great at helping a business nurture its leads by automating many of the tasks that are part of the lead-nurturing process. These include sending emails, scheduling follow up and scoring the leads in question. The automation of these tasks can free up the sales team to focus on closing deals.
3. Converting a Greater Number of Leads into Customers
The whole purpose behind nurturing leads through the sales funnel is to finally convert them into customers. This can be done by making it easy for the prospects to buy from the company or business in question. Deploying CRM software can help a business convert a greater number of leads into customers by equipping it with the tools required to close deals effectively and efficiently. Prime examples of such tools are sales pipeline management, opportunity management and customer relationship management.
The success of CRM in converting a far greater number of leads into customers than would have been normally possible, is borne out by the fact that 70% of sales representatives think that CRM helps close more deals.
4. Leveraging CRM Data to Improve Marketing Campaigns
CRM data can help a business improve its marketing campaigns by helping personalize a business's marketing outreach. It can do that by providing an accurate assessment of an ideal customer profile. Additionally, CRM can help measure the effectiveness of any marketing campaign by tracking its results. That helps a business to identify the campaigns that are the most effective and the ones that need to be improved.
CRM also helps target marketing campaigns better on account of its ability to accurately segment the customer base. This provides a business with the ability to make its marketing campaigns very effective in terms of the conversions achieved.
5. Using CRM for Customer Retention
While acquiring customers is extremely important for businesses, keeping them is just as important, considering that it is cheaper to retain a customer than acquire one. This is where CRM software can help by providing a business with the tools required to forge relationships with your customers. These tools include customer service management, customer feedback management and customer loyalty management.
Conclusion
CRM software is extremely effective in improving customer retention by providing a business with the tools required to forge and foster relationships with their customers. These include customer service management, customer feedback management and customer loyalty management. The deployment of these strategic CRM tactics can help businesses across the scale slash customer acquisition costs and improve the bottom-line.
The ever-increasing popularity of CRM as a means of slashing customer acquisition costs is easily understood when one looks at the fact that 74% of users think that CRM software has enhanced their access to their customers. It is not surprising, therefore, that 65% of companies using CRM meet their sales quotas. The popularity of CRM transcends the scale and size of a business, given that 91% of companies with more than 11 employees use CRM software. There is no better way to help a business slash its customer acquisition cost than by deploying smart CRM tactics.
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