Point-of-sale (POS) systems are changing, and for many businesses, there's no going back to traditional POS terminals. Technological advancements in these systems are making it easier than ever to run a business. These improvements include integration with customer relationship management (CRM) tools, allowing businesses to find new efficiencies and save money.
What is a POS system?
A POS system is a combination of hardware and software that allows customers to make payments for a company's products or services. When a customer makes a purchase, they complete a POS transaction using the system, which enables the completion of the business transaction between the customer and the company. The POS system consists of three parts that operate together:
- The hardware involves the physical components (e.g., credit card reader, monitor, barcode scanner) that are used to conduct the sales transactions and that run the POS software.
- The software, which is based locally or in the cloud, completes sales transactions.
Whereas traditional POS systems merely complete orders and payments from a stand-alone terminal, today's POS systems can perform a variety of advanced tasks, such as processing credit cards using mobile devices and transmitting sales data to other software a business already uses. In addition, many POS systems now come with built-in CRM features.
Key takeaway: A POS system includes the software and hardware needed to conduct transactions. See our list of the best pos system for small business to see how all of the top providers are ranked.
What is a CRM system?
A CRM system helps a company store and manage its customer data. It enables customer service, sales, business development, marketing, recruitment and other departments to manage external interactions and customer relationships. A CRM system provides a central location for storing potential and current customers' contact information, analyzing the data to make business decisions, identifying sales opportunities, tracking customer interactions, managing marketing campaigns and recording service issues.
Imagine never having to manually perform CRM tasks, like inputting customer information, creating sales reports and updating customer databases in the cloud. These are just a few of the things POS systems with CRM functionality can do. By integrating POS systems with popular CRM solutions – such as Salesforce, SugarCRM and Magento – businesses can save time and money, as well as use POS data to build solid relationships with customers and deliver the best customer experience possible. [Read our buying guide on choosing the best CRM for your small business.]
Key takeaway: CRM software helps companies track customer interactions and manage customer data, thus improving sales and marketing efforts.
POS system with CRM features
A POS system with CRM features serves as the hub for merging the company's sales, inventory and customer management services. It automates the process of sharing information collected through POS systems, allowing the CRM capabilities to make use of the data collected. The CRM-enabled POS system includes a wide range of capabilities, including the following:
- Store and manage customer information (e.g., contact details, conversations)
- Track leads from initial contact to conversion
- Track customer purchasing habits
- Forecast and report sales data and inventory
- Organize and segment customers by groups and subgroups
- Integrate text messaging, email and social media for communication with customers
- Conduct real-time reporting of inventory and sales data
- Share files and content among employees
- Record and track customer feedback and complaints
Key takeaway: A CRM-enabled POS system can improve the connection between sales and marketing by leveraging customer sales data to improve targeting in marketing campaigns.
How CRM-enabled POS systems can help your business
A CRM-enabled POS system will save you time in collecting and storing customer data, but it can do a lot more for your business than improve efficiency; it can also help you significantly improve customer relations and your bottom line. Here are five ways CRM-enabled POS systems can help your business:
1. Quickly capture customer information
Need to collect customer information? A POS system with built-in CRM functionality makes this task easier by automating information gathering to quickly capture customer data. Instead of inputting customer information into a CRM solution by hand, you can use a CRM-enabled POS system to collect the data from a transaction and then automatically export and save it. These POS systems can transmit all types of information your CRM solution requires, such as customer names, billing and shipping addresses, email addresses and preferred nicknames. This automation can save you time and money by eliminating the labor required to manually input data.
2. Increase sales by improving the customer experience
One of the most effective ways to increase sales is by paying attention to what customers want and need. With a CRM-friendly POS system, businesses can easily collect and keep track of customer preferences and buying histories, and transmit them to CRM systems in real time. This information not only helps businesses better target marketing campaigns and upsell at the point of sale but also lets them cater offerings to individuals or groups of customers to improve the customer experience.
3. Find your most loyal customers
Go after the right customers, and keep them coming back. One of the primary benefits of CRM software is that it can identify your most loyal customers. Integrating that capability with advanced POS systems can help you discover your three main customer groups: those who have the greatest impact at the point of sale, those who are likely to return and those who are not worth the time and effort to pursue. Combining all of this information with loyalty programs, rewards systems and gift card functionality built into POS systems is a great way to ensure repeat customers.
4. Improve collaboration among departments
It can be difficult or confusing to distribute and share information among staff members. A CRM-enabled POS system can improve the collaboration among departments, thus organizing and synchronizing transactions, customer details and other sales data in real time. This information is always updated and is available anytime to staff members, and to access it, you just log in to a single platform. This means no more wasted time sifting through inboxes, folders and random corners of your server, and no more confusion over the most current version of a file or database.
5. Automate back-end processes
CRM-integrated POS systems don't just automate tasks at the point of sale; they also automate back-end tasks, like reporting, exporting data, creating client records and even populating email marketing lists – all straight from the POS system. This means there's no need to go into multiple programs to manually perform these functions, thus taking monotonous, CRM-related administrative tasks off your staff's shoulders.
Key takeaway: Consider a CRM-enabled POS system to better capture customer data and leverage it to improve your business and find new efficiencies.