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How CRM Analytics Work

Max Freedman
Max Freedman

CRM analytics give your business insights into your customer service and sales operations. Use this data to make better decisions and maximize customer lifetime value.

  • CRM analytics gives you insights about your customers and how well your sales and customer service teams are reaching them.
  • CRM analytics helps you monitor your customer service efforts, validate your customer data, analyze your customers’ habits and generate better leads.
  • You can divide the most important CRM analytics into three larger classes of key data.
  • This article is for business owners and marketers looking to understand CRM analytics, what they track and why they should be tracked.

Even if you believe you’ve come up with the best product or service in the world, you’ll need to find people who agree enough to buy what you sell. With customer relationship management (CRM) analytics, you can figure out who’s buying, who might buy soon and how you can retain your customers. Below, learn more about CRM analytics and why and how your company should collect them. 

What are CRM analytics?

CRM analytics are data that demonstrate your company’s sales and customer service performance. CRM analytics also presents customer data that you can use to inform smarter business decisions. Typically, you’ll use CRM software to obtain CRM analytics and automate all your data collection and report generation.

Key Takeaway

CRM analytics provide insights into your customers and the performance of your sales and customer service teams.

Benefits of CRM analysis

The primary benefit of CRM analysis is that you can use it to inform your sales, customer service and marketing processes. You can use your CRM analytics to improve your methods via:

  • Customer service evaluations. CRM analytics fill you in on your customer service team’s performance. If you see figures that your team could improve, implement practices that push your team toward these goals.

  • Accurate customer data. Whether you’re using your customer data for demographic marketing or email marketing, you need to know whether you’re reaching the right person. CRM analysis ensures you’re doing just that.

  • Thorough customer analytics. How much does your customer usually spend per quarter with you? Are they buying the same products time and time again, or does it vary? With CRM analytics, you’ll get firm answers to these questions, and you can use what you learn to refine your marketing strategies.

  • Efficient lead generation. Your CRM analysis can tell you which of your marketing efforts most strongly correlate to purchases. If you see one approach correlating strongly to purchases but have only targeted a sliver of your customers with that approach, try that method more – your sales might increase.
Key Takeaway

CRM analysis is beneficial for evaluating customer service, confirming customer data, analyzing customer behavior and generating leads more efficiently.

What types of CRM analytics should you track?

CRM software platforms offer a wide breadth of measurable analytics. The below metrics are the most important.

Pre-sale CRM analytics

Much of your relationship with your customer is built before their purchase. After all, how often does a customer make a purchase without learning about the product (and sometimes your brand as a whole) first? That’s why the below pre-sale CRM analytics are important to track:

  • New leads. Your sales team likely spends lots of time calling potential new customers or, if applicable, sending proposals. You should track these activities to see how well they convert to sales.

  • Prospects. Even before your sales team identifies leads, they identify prospects. Chances are they call and email these prospects often as well. Track these activities to determine what is and isn’t working.

  • Personal interactions. It’s one thing to make a call or send an email. It’s another to actually reach someone. Track data about how many calls or emails actually lead to conversations, how often these interactions happen and (for phone calls) how long they last. If these conversations lead to immediate customer action, track that as well.

  • Website engagement. Some CRM programs include tools for identifying people who visit your company website, sign up for your newsletter or engage with you on social media. With this information in hand, you obtain a whole new batch of potential leads to target. After you first reach out, you can begin developing a customer relationship and gathering customer data.

  • Additional engagement. Free samples and product demos can be great for obtaining first-time customers. So too is inviting potential new customers to online or in-person events. You should track how often these approaches convert to sales – doing so can inform future decisions. You may also want to track this metric per sales rep to determine what underperforming reps could learn from higher-performing ones to improve.

Post-sale CRM analytics

Once a lead becomes a customer, you can’t guarantee that they’ll stay that way. That’s why gathering post-sale CRM analytics matters too. The most important post-sale metrics include:

  • Problem tracking. Record the problems that your customers raise with your products and fix recurring ones to achieve maximum customer satisfaction. The fewer active issues a customer has with your products, the more likely they are to keep buying from you.

  • Additional purchases. If you push one product with a lead, they might buy other products too. In this case, you can use the information you obtain about your customer’s other purchases to determine which products you’ll market to them in the future.

  • Purchasing patterns. If your customer buys your products or services on a subscription basis, look for consistency or variance in their orders to infer how likely you are to retain them as a customer. If you sense that this customer might stop purchasing from your company, try to retain them by offering discounts, promotions or other customer loyalty benefits.

  • Segmentation. After a sale, you can analyze just one customer or you can extrapolate your activity to all your customers. Use post-sales data across many customers to divide your customers into those most – and least – likely to keep purchasing your product or, better yet, buy additional products.

  • Spending. No two customers spend in exactly the same way. A customer on a monthly subscription plan worth $10 per month might not impact your revenue as strongly as a customer who makes an annual $1,500 purchase. Determine each customer’s impact on your revenue to decide how much resources to allocate to each relationship.

  • General project management.When one sale is over, another can begin. Use your CRM’s project management capabilities to identify key activities such as successful sales so that you can target your current customers for future purchases, whether of the same product or another one.

CRM analytics reporting

Alongside your CRM analytics tracking, you should run several reports that compile your analytics into actionable insights. These reports include:

  • Profitability. Turn your spending analytics into reports that show you which customers make the biggest impact on your revenue and remain the most loyal.

  • Sales forecasting. Now that you’re tracking your customers’ purchase activities, you might be able to predict how many sales you’ll make in future months. For budgeting purposes, this revenue knowledge can be paramount.

  • Sales conversion. How many of those pre-sales leads and prospects actually bought your products? Find out with sales conversion reports and refocus your sales efforts based on what your reports tell you.

  • Sales cycle. Most sales aren’t made overnight. Use sales cycle reports to learn how long your team needs to make sales. Once you know how long the process takes, you can structure your sales and marketing activities accordingly, but keep in mind that your sales timeline may fluctuate by customer, time of year and other factors.

  • Sales pipeline. Speaking of sales cycle reports, the very similar sales pipeline class of reports can tell you exactly where along the sales funnel your leads are currently located. With this information, you’ll know who needs what kind of push to go from a lead to a customer.

  • Goals. It’s not a complete sales or marketing plan without goals. If you set up your CRM software to compare your progress to your goals, you can identify gaps and redesign your campaigns to address these discrepancies.
Key Takeaway

You should track several types of pre-sale, post-sale and reporting-based CRM analytics.

How to track CRM analytics

The many moving parts of CRM are virtually impossible to track without software. That’s why there are plenty of CRM software platforms available for all kinds of businesses. In addition to CRM analytics, you should look for CRM software platforms with workflow automation, extensive third-party integrations and other features mentioned in the Business News Daily list of features to look for in a CRM solution.

We also name some of our best picks in our guide to choosing CRM software and our reviews of the best CRM software. You might encounter a lot of terms that are new to you even after reading this article’s explanations of CRM analytics – when that happens, consult our CRM software glossary to make sense of it all. With these resources, you should be well on your way to easy CRM analytics collection and a stronger, more fruitful sales and marketing approach.

Key Takeaway

You should use CRM software platforms to track CRM analytics, and as you choose the right program for your company, you should look for the factors common among trustworthy options.

Image Credit: Dekdoyjaidee / Getty Images
Max Freedman
Max Freedman
Contributing Writer
Max Freedman is a content writer who has written hundreds of articles about small business strategy and operations, with a focus on finance and HR topics. He's also published articles on payroll, small business funding, and content marketing. In addition to covering these business fundamentals, Max also writes about improving company culture, optimizing business social media pages, and choosing appropriate organizational structures for small businesses.