What does the GDPR mean for companies in the CRM space?
On Friday, May 25th, the General Data Protection Regulation (GDPR) was enacted to the European Union, affecting the privacy policies of businesses worldwide. If your business uses any form of CRM database, you are affected by these new laws — and if you decide not to play by the rules, you could be facing fines of up to 20 million Euros, or 4% of your global annual sales. To ensure that your company is not in harm’s way, now is the time to ensure you have your CRM database and privacy settings up to date, and are compliant with GDPR.
With the new laws in place, businesses are even more restricted in the way they collect, store, and manage the personal data of their customers and prospects. Having a CRM database that manages your data will allow for easier adoption of changes, like the GDPR laws, and can increase the overall quality of your customer interactions. We expect companies involved with CRM, EDM, Data Warehousing, and Data Management to look for improvements in their methodologies — these improvements could come from internal, organic growth, or through acquisition.
Many CRM providers have redesigned their systems to be compliant with GDPR regulations, but not all systems are created equally. To be sure yours meets the requirements, evaluate that it includes the following:
- Documenting the lawful basis for processing personal data
- Ensuring that data is only kept for as long as it meets the lawful basis
- Ensuring that data is accurate and up to date
- Sectioning of sensitive data so that only approved personnel can access it
In today’s climate, customers are becoming more and more wary of the protection of their data — and are expecting companies to step up. By implementing the right CRM, you can clearly communicate the compliance factors you have in place, which include:
- Implementing GDPR Policies
- Consent Management
- Data Security
- User Access Rights
- Right to Erasure
Types of CRM Software (2)
Operational:
- Provides a way to take care of customers and support for business processes in Sales, Marketing, and Service
- Access to information about the customer and their needs
- Solves problems related to high customer turnover and service costs
Analytical:
- Exploits customer behavioral data to help identify segments within a customer base that a business can act upon. In most Analytical CRM processes the customer in unaware of their activity being tracked.
- Customer behavioral analysis is used on sales data, financial data, and marketing data to help make predictions for customer wants and needs.
Collaborative:
- Use of a common platform across all departments to collaborate on gathered customer behavioral data
- Improves customer interactions, reduces service costs, and syncs customer data all in a common place to allow for collaboration
All CRM software types are interconnected. For example — operational helps determine what customers to target based on the analysis of their level of interest, while collaborative pinpoints customers based on their previous needs and inquiries.
Major Players & Largest Influencers (3)
Salesforce.com — Tracks customer interactions in a single location. They have a feature, called “Feed First,” which lets you change the settings so you can customize which data is more important to you, such as: the number of times contacts opened/received emails, company sales, etc.
Insightly — Has 500,000 users worldwide. Enterprise-level solutions for multi-level companies. Key features of Insightly: “task management, pipeline management, and contact management that help users to track deliverables to their customers, get clear visibility, boost customer communication as well as collaboration within the company.” Insightly is an example of an operational CRM.
Infusionsoft — Emphasizes organization and personalization. “52% of customers prefer marketing that is personalized.” Who wouldn’t want personalized information? 30,000+ small business owners use it. Provides business owners analytics on what strategies are working or not.
Microsoft Dynamics CRM — Uses automation for marketing on multiple dashboards. Provides seamless integration with third-party systems and applications. Connects email, calendar, and contact data though the Outlook/Exchange sync capabilities. “Immersive Excel online integration, meanwhile, lets you edit CRM data using Excel while PowerBI dashboards in CRM allow you to see data outside the CRM.”
Niche Players (4)
Verint Systems — Focus is on the use of cyber intelligence on customer engagement.
Freshworks — Focus on collaborative CRM. Collaboration workflow: sales -> support team -> IT service -> cloud-based call center -> sorting job applications -> chat with website visitors -> conversion optimization suite.
eGain — Integrated AI with virtual assistant that uses natural language with customers who visit the website, offer real-time web assistance, monitors social media streams, easily respond to high volume of customer emails, incremental sales effective analysis.
7MA relevant transactions in the space:
2. Saratoga acquired by CDC Software
3. Identitymine acquired by Valorem Consulting
For more information and recent transactions within the CRM Sector and Data Management, visit our website, 7mileadvisors.com.
Authors: Sydney Larese, Associate at 7 Mile Advisors & Adam Hade, Intern at 7 Mile Advisors
About 7 Mile Advisors
7 Mile Advisors provides Investment Banking & Advisory Services to the Business Services and Technology Industries globally. 7 Mile Advisors advises on M&A and private capital transactions, and provides market assessments and benchmarking. As a close-knit team with a long history together and a laser focus on our target markets, 7 Mile Advisors helps its clients sell companies, raise capital, grow through acquisitions, and evaluate new markets. All securities transactions are executed by 7M Securities, LLC, member FINRA / SIPC. For more information, including research on the M&A markets, visit www.7mileadvisors.com.
All securities transactions are executed by 7M Securities, LLC, member SIPC/FINRA.
