Everyone knows that the economy is in a challenging place right now, but few people feel those challenges more than small business owners. Inflation has been putting pressure on small businesses and the consumers they depend on for months now. June’s Consumer Price Index report revealed inflation jumped 9.1%. That increase is a 40-year-high and translates to real-life difficulties for small businesses struggling to cover product costs to utility bills. A recent small business survey from Act! found that 44% of small business owners identified inflation as their biggest challenge. To make matters worse, there’s also ample evidence that the economy is entering a recession. The U.S. GDP shrank in Q2, marking two straight quarters of decline. Two-quarters of economic contraction fits the academic definition of a recession, and there are other signs of a downturn as well. Employers ranging from tech giants like Meta and Google to retailers like Amazon are announcing hiring freezes and layoffs. While academics debate the definition of a recession, the economic reality on the ground will remain difficult for small businesses. The Conference Board’s widely used consumer confidence metric saw a decline for the third straight month in July, a sign that consumers are pessimistic about the economy and pulling back when it comes to spending. With data pointing to dark economic days ahead, small businesses need to take steps to protect their bottom line. What many small business owners don’t know is that they can tap widely used technology like customer relationship management (CRM) and marketing automation to do just that.
Investing in new technology in a difficult economy may not be every small business owner’s first instinct, but those who embrace CRM see an immediate return on investment. That’s especially true for the 45% of small businesses that Act!’s survey found still rely on paper records. This immediate and clear ROI occurs because CRM technology is designed to help businesses do more with less. Most CRMs are extremely customizable, so businesses can modify them to meet their needs and fit seamlessly into their workflows. And unneeded, extra bells and whistles can be turned off until needed in the future, thereby optimizing the solution today while making it scalable for the future as well.
CRM software is designed to make paper records a thing of the past, tracking all customer interactions and making them available with just a few mouse clicks. Customers can also be organized into groups, further cutting down on organizational mistakes and headaches. With the labor market remaining tight, and increasing personnel costs a non-starter for many small businesses, the productivity boost offered by a CRM platform is a huge win. CRM can also make a big difference when it comes to converting leads into sales. The technology’s contact tracking capabilities mean that the process for converting on warm leads can be expedited, ensuring no one interested in doing business slips through the cracks.
In addition to the behind the scenes boost CRM can give a business, it can also be a customer communication game changer. The pandemic and other recent disruptions have radically changed customer expectations when it comes to communication. The same survey from Act! also found that 21% of small businesses are feeling pressure to better communicate with their customers. Fortunately, combining CRM with marketing automation technology creates a reliable and easy-to-use customer communication platform. Contact tracking and grouping can help ensure customers get top notch service whenever they communicate with an employee at your business. Combining CRM with marketing automation also opens the doors for deeper relationship building with customers. Tracking dates like birthdays and anniversaries and sending notes acknowledging them can be a great way to connect with customers. While this kind of outreach would be hard to keep up with if done manually, marketing automation makes it possible to send personalized messages with just a few clicks. CRM and automated marketing campaigns also allow for easy-to-manage A/B testing, which can help a small business refine their messaging with customers for even better results.
With a recession around the corner, many small business owners may be looking back to the last significant economic downturn this country faced. Data from the U.S. Census Bureau suggests that 170,000 small businesses closed during the great recession from 2008 to 2010. Plus, the Federal Reserve Bank of St. Louis says the smallest businesses are often the most likely to fail in times of economic uncertainty. Despite these mounting challenges, Act!’s small business survey found small business owners who use CRM and marketing automation were more likely to be optimistic about the second half of the year. That survey also found that 42% of respondents who use CRM found that it immediately boosted productivity. During an economic downturn, small businesses need every edge they can find to survive. CRM and marketing automation are excellent tools to help boost efficiency, communicate clearly with customers and ultimately weather the economic storm.
Joe Greenspan, VP of Commercial Operations at Act! – a CRM and eMarketing solutions provider
Economic storm stock image by ruce Rolff/Shutterstock
