How To Use CRM Analytics To Support Business Decisions

Last updated on August 29th, 2023

In this guide, we’ll teach you how to apply CRM analytics to your business so you can power your business decisions with powerful insights.

If you want to retain your customers and increase your customer lifetime value (CLV), there’s one thing you can’t afford to neglect…

The customer experience.

The first step to creating a game plan to improve your customer experience is to analyze your CRM analytics.

We’ll help you get started by going over:

• What Are CRM Analytics?
• How Do Analytical CRM Tools Benefit Business?
• How Analytics Support CRM
• How To Analyze CRM Data: An 8-Step Process
• Which Analytics Should Be Tracked & Evaluated?
• Which CRM Helps Track Key Analytics Well?

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What Are CRM Analytics?

CRM analytics is data that measures business operations. 

This data gives you the building blocks to create a better business from making better business decisions. 

CRM analytics can help support calculated change when looking to improve marketing, sales, account management, and much (much) more.

However, one of the most important things CRM analytics will help you do is to create an improved and relevant customer experience.

Here’s an example:

Each quarter, you can set KPI goals centered around your “net-promoter score,” tracking how likely customers are to recommend your product or service.

As this metric elevates, it’s likely a tell-tale indicator of not just a strong product but a great customer experience overall. 

There are generally 4 aspects to the data analytics in CRM:

• Descriptive – What’s going on?
• Diagnostic – Why is it happening?
• Predictive – What’s likely to happen in the future?
• Prescriptive – What needs to get done?

When you take action based on your analytics, it can lead to many win-win scenarios for your customers and your internal operations. 

Let’s go over some background on what CRM analysts do:

What Does A CRM Analyst Do?

A CRM Analyst is a skilled professional that evaluates CRM data.

Their role is to help companies make the most out of marketing, sales, and the customer experience.

They can be employed internally, but it’s common for them to be hired externally or for a specific period depending on company needs.

Their job is also to maximize customer value to the business while also maximizing the business’s value to the customer.

And they do this by offering diagnostic, predictive, and prescriptive information (3 of the 4 mentioned earlier).

Here are some specific responsibilities of a CRM analyst:

• CRM data analysis
• Creating sales and marketing plans and recommendations
• Noticing company data trends
• Pinpointing CRM data correlations
• Analyzing customer behavior
• Tailoring strategies that improve the customer experience and customer value to the business

How Do Analytical CRM Tools Benefit Business?

Establish Predictive Modeling

Predictive modeling is when you forecast future results based on past data or overall data trends.

Let me explain:

Think of when companies determine the emails that get them the best conversion rate.

By analyzing data from, let’s say, the past 60 emails sent, they can use that information to understand what future outcomes may look like.

Now, let’s say their past subject lines that consisted of questions with the receiver’s name in them turned out to have the best open rates and click-throughs.

With predictive modeling using CRM analytics, they can continue to adopt question-based subject lines along with the recipient’s name again to get a similar result in the future (i.e., more email engagement). 

Predictive modeling even helps businesses reduce risk.

If you’re wondering how, it’s because you can already pinpoint what’s the most likely to work, allowing you to save money on the “testing” phase of a marketing campaign or even a new sales approach. 

Better Identify Business Bottlenecks

CRM analytics give you objective information on where certain slow-downs are happening.

For example, you can use your sales CRM’s pipeline analytics to track your sales velocity and pinpoint why some deals are falling through.

Maybe it’s because your sales cycle is slower than usual or you have a poor win rate in the “proposal” stage of your sales process.

By identifying bottlenecks, you can put systems in place to fix them.

But, keep in mind that you want to give any new changes some time to show their effectiveness (ideally about a quarter).

If we look at physical product businesses, they especially gain a big leg up with CRM analytics.

How?

Order management!

By showing you the sales volume of product purchases, you can pinpoint different times of the year to anticipate a high or low volume of purchase orders.

This allows you to maximize profits with the way you order inventory.

More Relevant Messaging Thanks To Deeper Customer Insights

CRM analytics let you peek into what works with specific customer segments and what doesn’t.

For example, you can look at email response rates and A/B test customer groups to find what’s getting them to open, click and download content. 

Plus, with audience segments, you can help find ways for sales reps to connect with your customers on a more personal level (based on their demographic and behavior).

But that’s just scratching the surface. Integrations with other tools like email and calendar apps boost productivity. It allows agents to perform tasks from a single user interface. Automation of mundane tasks like approval processes and email sending frees agents to focus on building customer relationships.

Tracking customer analytics like purchase history, demographics, and interactions leads to tailored services and targeted advertising enhancing customer satisfaction. An AI-powered CRM platform offers valuable insights and forecasting tools speeding up the decision-making process.

CRM Analytics Challenges And How To Overcome Them

While CRM analytics can boost your team’s productivity, it comes with a set of challenges you should be aware of.

Let’s review these challenges and the ways to tackle them:

• Siloed data: Different departments may rely on separate CRM software, creating data silos. You can solve this by investing in a customer data platform (CDP) to centrally store information accessible to all employees.
• Adoption resistance: Some businesses face resistance when convincing employees to adopt a new CRM system. Strong leadership is key to easing this transition and helping employees embrace the new platform.
• Software integration: The integration of analytical software with existing and new systems can be a challenge in CRM analytics. If the software doesn’t integrate properly, the collected data may become difficult to use.
• Data entry: Without AI integrations, CRM platforms require manual data entry, which may be time-consuming and hard to keep it up-to-date. AI-integrated CRM can simplify this process.

How Analytics Support CRM

CRM analytics give your business the information and insights needed to connect to the customer on a deeper level, building your relationship with them further with each interaction.

Analytics centered around customers (like customer lifetime value and customer retention rate) are vital metrics that help you measure how well you’re managing customer relationships.

After all, that’s what the goal of CRM is: 

Building the customer relationship in a win-win way.

And data your CRM analytics show will be invaluable if collected and analyzed correctly.

It’s one thing for your KPIs to be accurate, but it’s a bigger victory to analyze it and learn information that you can take action on. 

That leads us to the burning question:

How To Analyze CRM Data: An 8-Step Process

Here’s a step-by-step way of evaluating your CRM analytics to come to find actionable insights.

1. Pinpoint exactly what you’d like to analyze – Is it marketing, sales, or customer analytics? Get specific.

2. Understand the data and how it was generated – Was it imported, autogenerated, or manually entered? 

If imported, you want to make sure it’s up to date. If it’s manually entered, it’s good to double-check that the information was entered correctly.

3. Make sure the data is clean – Note of any missing data, and potential duplicate information (for example, perhaps a sales deal was listed twice on your sales pipeline leading to your sales velocity being miscalculated)

4. Descriptive – View the data and take note of what you’re seeing. Make sure it’s set to the timeframe you’d like. 

5. Diagnostic – Examine what causes this data to be what it is. Is it reflecting something your team is doing right or wrong? Are there outside factors influencing the data? Again, get as specific as possible.

6. Predictive – Predict what’s likely to happen in the future due to these analytics and those of the past. Compare different timeframes (monthly, quarterly) to get an accurate prediction. Think of speaking with team members to see other predictive ideas. If possible, create a report that puts your data in a visual format.

7. Prescriptive – What needs to get done for this data to either improve or remain the same (how do you hit your KPI goals)? What other KPIs should you improve or keep an eye on? For instance, if your win rate is lower than previous quarters, you can look to shorten your average sales cycle by narrowing down your marketing to specific segments and tweaking your discovery call questions to qualify more.

8. Act on Your conclusions – Execute the action needed to help make your analytics improve or remain at a sufficient level. 

Which Analytics Should Be Tracked & Evaluated?

There are countless analytics that can be tracked.

The ones that hold the most value in many cases are up to your organization.

With that said, there are still clear analytics out there to keep your eye on, so here they are:

Sales Cycle Length

The sales cycle is how long it takes your sales team member to close a single deal, on average. 

This is typically done with at least several weeks of historical data.

It looks at the number of days spent on sales versus the total number of deals closed during that period.

A survey of B2B companies found that 74.6% of sales take at least 4 months to win, and almost half (46.4%) take at least 7 months or more.

Remember that these numbers are general estimates.

So think up comparing your average sales cycle length with your industry average.

Lastly, it’s good practice to keep your sales cycle as short as possible, which is done through combining sales effectiveness & sales efficiency. 

Win Rate

The win rate is a raw measure of how effective a sales team member or the team as a whole is.

It takes the total number of potential deals and divides that by the number of closed sales.

Your win rate should be analyzed closely since it comes near the end of your sales cycle, which means small things in the different stages before it can influence the win rate quite a bit. 

Here are a few ways to boost your sales win-rate (correlating to sales effectiveness and efficiency):

• Adopt a value ladder
• Update your sales playbook
• Establish a dialed-in sales process
• Qualify leads with a proven sales methodology

New Net Revenue

New net revenue is how much new business is flowing into the organization and can give you a solid overview of the effectiveness of your sales team.

This analytic is critical, especially when implementing something new in your organization. 

I’ll toss in an example:

New Net Revenue can help you pinpoint if your new lead distribution approach enables you to win more deals by having certain leads go to certain specialized sales reps. 

Customer Lifetime Value

This potent metric can help forecast the value of the lifetime relationship with a given customer.

The goal is to create a great experience that reflects customers wanting to do business with you for as long as possible.

A high-quality customer experience correlates with a great CLV, while unhappy customers tend to contribute to churn rate. 

A great CLV also allows you to save on marketing costs since getting a new customer is between 5x-25x more expensive than keeping one.

Which CRM Helps Track Key Analytics Well?

VipeCloud is a premium CRM that is a fantastic value add for sales, marketing, and customer relationships. 

It includes built-in functionality to track all the key metrics, along with insightful reports that tell you what’s working well and what’s not.

Which allows you to adapt and adjust as needed to keep your operation running smoothly. 

Not to mention the customizable interface allows you to set it up in a way that fits your business. 

Try VipeCloud’s Sales & Marketing Suite for a free 15-days, no card required!

Want to see it in action while we answer your questions? Book a free demo, and we’d be glad to show how VipeCloud will work for your business.

CRM Analytics FAQs