Artificial Intelligence Is the Next Step in CRM’s Evolution
Until recently, the use of Artificial Intelligence (AI) by businesspeople has been more science fiction than reality. Today, however, many CRM vendors are talking a big game about enriching their platforms with intelligence and incorporating AI into their solutions.
Salesforce and other CRM vendors—Microsoft, SAP and Oracle—are betting that with AI, businesses will be able to deliver more predictive and personalized customer experiences across sales, service, marketing, commerce, and more. For instance, Salesforce CEO Marc Benioff touts Salesforce’s new Einstein product, saying that it “is now every customer’s data scientist, making it easy for everyone to take advantage of best-in-class AI capabilities in the context of their business.”
These vendors are making substantial investments to the tune of hundreds of millions of dollars in the hopes of transforming enterprise operations, wowing shareholders and gaining market share. Consider Microsoft’s recent acquisition of LinkedIn for $26.2 billion to bolster its software solutions, including Dynamics. With this acquisition, Microsoft will be able to leverage data from millions of LinkedIn profiles. Given this, it is worth considering the opportunities AI-infused CRM will create.
First, with AI and machine learning, enterprise sales and marketing teams can expect dramatic changes in their overall effectiveness. Today, most people use legacy CRM solutions to look up contact information, check personal details, or see when someone on their team last contacted a customer. They have a sea of names and data, but little or no insight into which people have the highest propensity to convert. This is problematic.
A CRM without AI, machine learning, and predictive analytics is like searching for a needle in a haystack. You have no idea where to start. AI-infused CRM software will enable teams to prioritize audiences, alerting them to the prospects that have the highest propensity to make a purchase.
AI-fueled CRM will cull through millions of personal and professional attributes assigned to prospective leads. As enterprise global data continues to expand at a rapid pace—some analysts expect an increase of 4,300 percent in annual data generation by 2020—sales and marketing managers will need intelligent solutions more than ever. These solutions will effectively separate the wheat from the chaff, which is something a salesperson or team would never be able to do given the sheer volume of data available about perspective sales leads.
For example, imagine you are selling a SaaS-based management system to insurance agents. The CRM of the future will analyze customer records to identify target businesses and the decision makers. It also will provide you with insight into the target company’s previous technology choices, informing you whether your solution is complementary or redundant.
In addition, the CRM of the future will help you determine the best person to approach to close the deal. By blending personal and profession attributes, it might, for instance, encourage you to reach out to a manager who has received several promotions and enjoys rock climbing in his free time. It will suggest this manager because he meets the profile of an early adopter. He is likely to be a young, up-and-coming leader and risk taker who is more inclined to try new things. Armed with this information, your probability of closing the deal is higher. You will be calling on an early adopter with a need for your solution, versus reaching out to a laggard using a competitive solution.
Over time, this system will teach itself to do an even better job of targeting potential customers and decision makers by identifying which personal or professional attributes hold the most weight. For instance, maybe insurance companies using a SaaS-based solution like Marketo have the highest tendency to be interested in your management solution so you should call on them first.
As the software evolves, it will effectively create a system of continuous improvement for sales and marketing teams. AI and predictive analytics will make all aspects of CRM better, from sentiment and intent analysis to lead scoring, product recommendations, and upselling. This intelligence will also minimize or prevent customer churn.
Vendors understand they must articulate how their CRM’s AI features are unique to differentiate their tool and gain market share and are already attempting to do just that. For example, Salesforce recently announced it is democratizing AI by adding intelligence to all its CRM applications in upcoming updates. Microsoft and other vendors are not standing idly by. With the debut of Dynamics 365, Microsoft has imbued its CRM tool with improved data analytics and artificial intelligence capabilities.
Considering the CRM worldwide market value grew 12.3 percent from 2014 to 2015 to reach $26.3 billion, there is a lot at stake, and the next two to three years are when we can expect to see the battle intensify.
Only time will tell how deeply AI will continue to disrupt not just the CRM space but business platforms as a whole. One thing is certain: We are in an exciting period of evolution for the CRM industry, and many stakeholders across the spectrum are not only keenly aware but also heavily invested in how this seismic shift toward an intelligent, proactive enterprise application plays out.
Chris Matty is the founder and CEO of the predictive analytics company Versium, based in Seattle.