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CRM stands for customer relationship management. As the name suggests, CRM software is a system for managing your relationships with customers.
You can use CRM software to keep track of interactions, data, and notes about customers or potential. The data is stored in a central database and is accessible to multiple people within an organization.
A CRM helps streamline sales, marketing efforts, customer service, accounting, and management for growing companies. Multiple people can access and edit the information about a particular client’s customer journey.
A customer might first enter your CRM by filling out a contact information or demo form on your website. After a few follow-up emails with a sales rep, you can update the customer’s information to reflect what you’ve learned about their organization. Marketing can then quickly determine how to best appeal to their customer needs.
Some of these steps are tracked automatically, while other data may be entered manually. Having everything accessible in one system reduces unnecessary clutter and paperwork, speeds up communication, and improves customer satisfaction.
We’ll expand on what CRM is and why companies use these tools in more detail below.
Companies use customer relationship management for many reasons, but the overall goal is to improve the customer experience and increase sales.
In general, a CRM works best for considered purchases or service providers. Fine jewelers, landscapers, realtor firms, lawyers, or accountants can all benefit from a good CRM. B2B companies, especially those with longer sales cycles like SaaS, also benefit from a system that simplifies business processes.
A good way to determine if your business would benefit from a CRM is to consider the challenges a CRM aims to solve:
Now that you know what a CRM is, you might have decided that a CRM system is probably in your company’s future. The next logical question is when?
Many startups and small businesses start by simply storing their leads in an email marketing tool and their list of customers in a spreadsheet. That works fine for a while, but at a certain point, things start to break. Especially for companies looking to grow their business, it can get tough to keep track of everything.
When you store your information in different places, it can lead to discrepancies between different databases. Something as simple as someone forgetting to update one spreadsheet can slow your team down as they try to consolidate everything.
Separating key information can also make it difficult to visualize how different contacts or companies are connected.
With traditional software, you don’t have the option to update information in real-time, integrate with your favorite apps, or track how your customers interact with your website. With a CRM, you can.
A CRM also helps with HR issues like employees leaving. Without a CRM, you rely on salespeople to close their open deals and remember to update any unwritten communications. A CRM removes the guesswork from this process and saves everyone time by storing everything and allowing the next teammate to jump in without losing a step.
In short, the answer for most companies is pretty simple. While you may be able to get by for a while without a CRM system, adopting one sooner is often better than waiting until you feel the pain of an ad hoc solution you’ve outgrown.
CRMs range in price. There’s not a one-size-fits-all answer. A few important things to keep in mind are:
While CRMs have been around since the 1980s, it wasn’t until the late 90’s that they started to develop into the automated cloud-based systems we know today.
Since their creation, CRMs have gone from little more than digital Rolodexes to fully mobile, cloud-based systems that integrate with hundreds of other apps and software.
Automation helps save time, reduces human error, and expedites the sales cycle for companies.
CRMs store tons of information, not just emails and phone numbers. You can track when a customer visits your website, which emails they open, and how they interact with your company.
Thanks to the shift toward a cloud-based model, the remote work environment of today isn’t tethered to an internal system. You can securely access your CRM wherever you’re working and collaborate with coworkers half a world away.
CRMs make life easier, but seeing their impact on your business is also important. CRMs have significantly affected companies' growth in the past few years, and their popularity continues to rise.
65% of sales organizations use a CRM in 2020, compared to 59% in 2018 (Salesforce, 2020). The reasons they chose to use a CRM vary, but top responses included automating tasks like scheduling meetings, content delivery, and contract generation.
Many companies have stated they use their CRM software to improve retention. 82% of the respondents in a 2021 survey said "Active customer retention" is one of the most important objectives for their CRM team (Tinyclues, 2021).
The integration is paying off as well. 61% of overperforming leaders report using a CRM to automate at least part of their sales process compared to 46% of underperforming leaders.
CRM systems like HubSpot CRM solve the many challenges presented by growth. CRMs effectively deal with contact management, company, and sales opportunity information.
They also help consolidate interactions through different communication channels, including your website, email, phone calls, and social media.
It’s more critical than ever for marketing and sales teams to function as a cohesive unit, and CRM systems are the perfect solution to help scaling organizations achieve that goal.
CRMs help lead to a better customer experience, communicating more effectively with your organization.
Perhaps most importantly, modern CRM solutions support the complex workflows of fast-growing sales teams. CRM systems keep your team in sync, facilitate more effective use of time and eliminate many of the mindless tasks that take up time without adding value.
What are common questions for people learning about CRM?
Customer relationship management (CRM) is a system or software that helps track information and interactions between your company and your customers. This system is accessed and edited by multiple people to improve the customer experience, automate parts of the sales cycle, and improve communication.
A CRM system is used to store and track customer data and interactions. Some data might be entered manually, like when a customer gives you their email address, while other information is tracked automatically.
Different groups access the CRM within your organization for various reasons. Sales might look at the type of company or previous orders, while marketing might be more interested in the CTR of different marketing campaigns targeted toward the client.
A CRM automates many mundane tasks such as data entry, cross-department communication, and tracking customer interactions. Many CRMs are cloud-based, allowing you to access this information anywhere. They improve the customer experience and allow for better communication between departments.