What is
CRM?
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.
Why do
companies use customer relationship management software?
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:
Store all
of your customer information in one consolidated system. Instead of
communicating information to multiple divisions, you can use a CRM platform to
create a single up-to-date point of truth that everyone can access.
If
customers regularly interact with multiple people from your company, it’s easy
to keep track of previous interactions with a CRM.
A CRM can
help you track the productivity of your sales teams. It can also help you
establish a workflow or process to follow.
When is
the right time to adopt a CRM?
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.
How have
CRM systems grown to help companies?
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.
