Posted On 21 Sep 2020
Marama Carmichael

If you work in sales and marketing, it’s safe to assume that you’ve encountered the terms customer relationship management (CRM) and marketing automation software. It’s also safe to assume that you’re not entirely sure how they’re different from each other. Well, you’re not alone.

While both are essential tools for collecting and managing customer data used for sales and marketing, there are key differences and understanding them allows you to use each one effectively for better results.

What are CRM and marketing automation?

One of the most important parts of running a business is making sure you have repeat customers. That requires constantly checking up on them, letting them know you’re around in case they need you. This can involve sending emails, remembering who to call, creating a schedule, etc.

You can imagine how tedious and time consuming that can be and even though it’s arguably the most important part of your business, it still is just a part. There are other things that need to be done to keep it running. Enter marketing automation and CRM.

These tools are designed to make working with your company’s leads and customers easier. Their entire purpose is to automate repetitive tasks in order to have constant, efficient, and effective communication with your leads to eventually make a sale. They map out a customer’s journey from awareness to a call to action to a sale. By executing email templates, campaign designs, and social media posts, you can get customers to do what you want them to do: sign up, shop, join, download, etc.

The key is making everything efficient for you and the customer and to ensure they keep returning by being a constant presence in their online experience. All that can be set up through automation and can still be highly personalised.

Why you need marketing automation

  1. List management and segmentation

Marketing automation allows you to manage your contacts into lists and segments.

Based on their engagement, contacts can be grouped into:

  • customers,
  • trial users,
  • blog subscribers, etc.

Through this, you are able to send personalised email blasts and social media posts that resonate with their interests. With this data, you can also segment your emails based on information such as age, gender, geo-location, etc. 

  1. Triggered emails

These are emails that are automatically sent based on specific customer actions: filing a contact form, placing an order, booking an appointment, subscribing to a newsletter, etc. This lets you respond to a customer’s action instantly, while they are interested.

  1. Lead nurturing

After you’ve spent money and energy on lead generation, don’t let it go to waste and convert those leads to paying customers. Establish authority and engage with your leads by sharing content that resonates with their interests and persuades them to the next stage of the funnel.

  1. Marketing analytics

KPIs or key performance indicators are priceless data that let you know which of your campaigns is working for you and which is essentially wasting money. Having marketing automation shows all this in one dashboard, making it easily accessible for you.

Why you need CRM

  1. Clear view of customer journey

Closing a deal is easier by visualising every interaction and contact your business has made with a customer, which a CRM tool provides. It gives you insight on each customer, what their experience is like and which steps led to a conversion or a loss of customer.

  1. Integrate your different marketing channels 

CRM helps you fully integrate all your marketing channels by syncing your customers from each one in one place. Whether they’re from your website, email marketing, or social media, they are all synced in your CRM software.

  1. Automate repetitive tasks

A sale requires forms to be filled, reports to be sent, and invoices to be issued. These tasks are time consuming and repetitive for each new sale. Your CRM tool helps with this to free your time so you can focus on closing leads and resolving customer pain points.

Key differences

  1. Who uses them

In essence, both offer automation, analytics, and reporting important metrics and insights while providing efficiency. Where they differ is their users. CRM is utilised by sales representatives while marketing automation is used by, well, marketers.

  1. Main function

Marketing automation generates leads from marketing campaigns, whether it be an individual or a business that is interested in your product or service. It does so through lead management, email marketing, market segmentation, and A/B testing. It then stores this information in the database.

CRM users then analyse this information to transform those leads into buying customers, whether it’s through offers or discounts and other similar campaigns. They also use that same information to retain existing customers. By analysing customer behaviour, interaction history, purchasing trends, and more, they can then create more personalised campaigns to enhance customer retention.

Key CRM features are contact management, sales automation, communication channels, and task/workflow management.

  1. Goal

The short of it is, marketing automation gets leads and CRM converts those leads to sales. But while  each tool’s goal occurs at different areas in the sales funnel, they actually complement each other in their effort to turn leads to customers and retain them.

  • The marketing team engages with leads on the website and vets them for lead qualification, i.e. their level of interest and purchasing capability.
  • Once found to be viable prospects, leads are transferred to the sales team (CRM users) who try and convert them to buying customers. In this way, the sales team don’t waste time trying to convert a lead who is not market qualified to be a possible customer.

Together, these actions make up a buyer’s journey.

Which one is for you?

After knowing the difference between the two, it’s become clear that while they do serve different purposes and users, both are important for your business. CRM and marketing automation both help your team be productive and efficient, leaving you more time to spend optimising or developing new products or features, or more time for yourself.

They empower each other and work seamlessly together. You may not need both at the start of your business, but eventually when your lead generation increases, both will prove to be indispensable tools to your business.

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