According to Gartner, the global CRM market is growing three times faster than any other element of the enterprise software sector. With businesses spending $18 billion a year on CRM implementations, expectations of a good return on investment (ROI) must be very high.

But does CRM deliver on ROI?


Sometimes Yes…

In a recent survey of CRM decision makers, Nucleus Research discovered that successful projects are generating a return of up to $5.60 for every $1 spent. This return is measured in various ways, particularly the improved productivity of users in key departments (up to 15% for salespeople, for example).

…and sometimes No

Unfortunately, however, some CRM projects still deliver disappointing returns or fail altogether. Business leaders new to the market see the wisdom of buying a system, but without first aligning their purchase with specific business requirements.

5 Common Pitfalls to Avoid

According to CRM Buyer, there are five common mistakes that regularly contribute to ROI failure of a CRM system:

  1. Businesses replace one set of information silos with a new set of CRM silos.

  2. No reconciliation between sales and marketing goals – two of the most important departments in any CRM project.

  3. Managers demand reports but never get around to studying them and translating their findings into meaningful consequences for the business – surely one of the primary reasons for investing in CRM in the first place.

  4. Managers ignore what the CRM project reveals to them about their customers, and carry on trying to control the conversation

  5. Having implemented CRM, businesses continue on their merry way on the assumption that simply having a system in place will get them closer to their customer.

All of these can be avoided by careful planning, which should start before you even think about calculating your ROI. How will CRM relate directly to your business needs and ambitions?

Set your targets

For example, you might aim for your CRM project to generate five additional sales per month. That’s 60 per year. If your average sale is worth £1,000, CRM could bring in an extra £60,000.

Know the potential benefits:

  • Improved sales management makes salespeople more effective and productive at the customer face, because they have access to better information and can react instantly to client requirements.

  • New lead conversion rates improve as salespeople know more about their customers and make increasingly targeted sales.

  • Existing customers become more valuable as salespeople are able to target them with more informed and relevant offers.

Cut down costs

Unprofitable customers, unproductive employee time, online self-service possibilities and marketing campaigns that wastefully target non-responsive customers would be typical targets here.

Automate repetitive tasks

Your sales team is best employed in the field, selling and talking to customers – gathering more information and generating revenue. So why are they spending their time on manually capturing leads from your website? Potential selling time can be saved using automatic lead capture functionalities of a CRM system.

Streamline IT

Can you pinpoint specific efficiency goals? Reduced maintenance and licence management costs, more effective support for users and simpler development paths should all feature in your ROI calculations.

Spend time and money where it counts

Increasing sales to existing customers can cost five times less than bringing in new business, according to data from the in-depth Guide to Getting Value from CRM,  Those customers who engage can be up to 75% more likely to convert.