Analytical CRM is one of three subsets of CRM (Customer Relationship Management) – the other two are Operational CRM and Management CRM.
Analytical CRM refers to the process whereby a business analyses data (that has been collected by the Operational CRM) about its interactions with its customers. This analysis is conducted for the purpose of identifying levels of customer satisfaction with the aim of improving it and ultimately, increasing customer retention rates.
This specific component of the Customer Relationship Management process is an essential part of running a consistently successful business, and when done properly, it’s conducted behind the scenes for the most accurate results.
Some of the best CRM providers include:
What Exactly is Analytical CRM?
Technically speaking, analytical CRM is the systematic electronic analysis of customer data that has been collated from both online and offline customer behaviour.
While the operational side of CRM serves the purpose of merely collecting data, analytical CRM is all about extracting as much information from the raw data as possible.
But, what exactly is customer data?
Customer data consists of many things, namely personal information, behavioural information and demographic information.
In its raw form, customer data is pretty useless, but by conducting analysis on this raw data – especially in the form of complex, back office analytical CRM – businesses are able to glean vast amounts of essential information about their customer base in order to improve services and ultimately, become more successful.
CRM Analysis can allow businesses to identify key patterns and trends in customer behaviour, indicating what they like and don’t like, to put it crudely, along with which offerings have been well received and which ones haven’t.
What Are the Main Features of Analytical CRM?
Analytical CRM is a fairly broad term, and it encompasses a plethora of different aspects of the CRM process. It operates in the backend of a company’s server, thus going undetected by customers.
By analysing all aspects of a company’s operations and offerings, the intention is that CRM analysis can provide both a holistic view of the entire business as well as detailed insight into specific components of the company.
The key features of analytical CRM include service, channel, customer, sales and market analysis. By analysing all of this information both separately and as a whole, companies are able to draw conclusions regarding the success and efficacy of their operations and start working towards finding ways to optimise operations.
- Service Analysis: The aim of service analysis is to glean information regarding how well (or badly) business services have been received by customers. It allows for the assimilation of information drawn from surveys, pools and customer sentiment in order to draw conclusions regarding the overall satisfaction of customers. This allows companies to direct company resources to the right places.
- Channel Analysis: Since businesses are comprised of various different channels, it’s essential that data from all of them is properly analysed. These channels include things like email, telephone lines, social media and more, depending on the business in question. In the most basic sense, this information tells businesses how customers prefer to be contacted.
- Customer Analysis: Customer analytics is all about attempting to properly understand customers on an individual basis, something that wouldn’t normally be possible on a large scale if it was done manually. This is important as it provides valuable information about customer behaviour, including identifying high-value customers, predicting future behaviour and tailoring marketing and other things based on their preferences.
- Sales Analysis: Analyses of sales data can provide information regarding not only which products and services are most successful, but it also can provide businesses with a comprehensive understanding of sales cycles in order to make any necessary improvements.
- Market Analysis: Market analysis is an absolutely imperative component of analytical CRM, allowing companies to properly study market trends, as well as customer preferences and the competitive landscape more generally. This makes it easier to stay ahead of the game and give customers what they want. It also provides a great way to plan, manage and eventually, scale marketing plans.
Conducting widespread, in-depth data analysis by means of analytical CRM processes is a key way in which businesses are able to operate according to what customers want and are actually receptive to.
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How Can Analytical CRM Benefit Business Operations?
Analytical CRM is one of three parts of the overall CRM process, but it’s the point at which the important information from big data sets is extracted in order to make conclusions and, eventually, decisions that’ll have real effects on business.
In addition to the ultimate goal of improving operations, some specific advantages of good analytical CRM include:
- Optimised Sales Strategies: By means of analysis, businesses can identify customers that are particularly valuable and understand their purchasing patterns with the intention of making them happy. This allows sales and marketing teams to focus their efforts in the right places.
- Enhanced Customer Insights: Analytical CRM allows businesses to get a holistic view of their customer base, from demographics to purchasing history and preferred method of communication.
- Improved Efficacy of Marketing: As we’ve touched on, having a good understanding of customer behaviour and preferences allows for more accurate targeted marketing campaigns and the most effective marketing channels. Analytical CRM also allows companies to track the performance of specific marketing strategies in order to optimise these efforts and allocate resources effectively.
- Better Customer Retention: Ultimately, effective analytical CRM results in better decision making which, at the end of the day, leads to businesses being able to build stronger relationships with customers, keep them happy and ultimately, maintain their loyalty.
- Data-Driven Decision Making: Analytical CRM allows increased usability of data in order to be able to make informed decisions. It improves business’s ability to make quick decisions that are also sound. Furthermore, this analysis allows for the early detection of potential problems, including market declines, operational inefficiency or customer dissatisfaction.
- Streamlined Operations: Big companies can struggle to consolidate information and data, and analytical CRM can help integrate data from various different channels and provide an overall, unified view of customer interactions, behaviour and overall satisfaction.
What Are The Benefits Of Analytical CRM?
Analytical CRM forms a vital component of the overall Customer Relationship Management Process, allowing businesses to not only receive raw data, but properly understand what it means.
It allows companies to glean useful information from large data sets and identify patterns and trends that can be immensely helpful for improving performance and ultimately, retaining customers and improving services.
By conducting proper, in-depth research on what is and isn’t effective, not only based on customer feedback back but real-life behaviour too, businesses are able to make proper data-driven decisions that will help improve customer satisfaction and the overall performance of the business.