What Is CRM (Customer Relationship Management)?

CRM stands for customer relationship management, which is a system for managing all of your company’s interactions with current and potential customers. The goal is simple: improve relationships to grow your business. CRM technology helps companies stay connected to customers, streamline processes and improve profitability.

When people talk about CRM, they’re usually referring to a CRM system: software that helps track each interaction you have with a prospect or customer. That can include sales calls, customer service interactions, marketing emails and more.

CRM tools can unify customer and company data from many sources and even use AI (artificial intelligence) to help better manage relationships across the entire customer lifecycle, spanning departments like marketing, sales, digital commerce and customer service interactions.

That’s the CRM definition. So why is CRM important and who can benefit? Let’s take a look.

What we’ll cover:

• Who is CRM for?
• Type of CRM
• Why is a CRM system important for your business?
• What are the benefits of CRM?
• What does a CRM system do?
• How much does a CRM cost?
• CRM System Implementation Process

CRM software is used by companies and industries of all sizes. It benefits large enterprises that need to easily track customer activity in one place and share it across departments, small businesses that often need to do more with less and startups looking to be nimble and efficient. No matter your industry or even if you’re a non-profit, if you communicate with customers — and your employees rely on information about those customers — a CRM system can help.

Customer relationship management software can benefit virtually any department at your company, from sales to service, to IT, to marketing, and more. Whether you want to start big or start small, it's easier to get started than you might think.

CRM systems come in various types, each tailored to meet specific business needs. The three main types of CRM are:

This type focuses on automating and streamlining business processes for sales, marketing, and customer service departments.

Marketing Use Case: CRMs can help with marketing automation by integrating and centralising customer data, assigning leads to nurture funnels, automating email campaigns, customer segmentation and a whole host of other functions.

Sales Use Case: CRMs are widely used for lead management. They can automatically assign new leads to the appropriate sales representative based on predefined criteria, such as geographic region or industry. CRM can help with sales automation by streamlining and optimizing various sales processes, reducing manual tasks, reporting on sales pipeline, and allowing teams to focus on closing deals.

Customer Service Use Case: Generating support tickets and routing them to the right customer service agent, ensuring quick resolution of enquiries, and efficient customer management & improvements to customer satisfaction scores.

Analytical CRM Databases are designed to analyze customer data and generate actionable insights. They provide businesses with a deeper understanding of customer behavior, helping to refine strategies and improve decision-making.

Example Use Case: CRMs can be used to analyze customer purchase data, identify trends and create personalized marketing campaigns.

Collaborative CRMs enhance communication between different departments, ensuring that customer data is shared seamlessly. This type of CRM technology fosters teamwork and consistency, leading to a more cohesive customer experience.

Example Use Case: With Collaborative CRMs, you can share customer interaction history between sales and support teams to resolve issues and provide better targeted customer service.

Choosing the right CRM depends on your business goals and the challenges you aim to address. Each type offers unique advantages that can help you build stronger customer management practices and drive growth.

Salesforce offers the full package, offering a unified platform that combines all three types of CRM. So you can streamline operations, benefit from AI-powered analytics, and collaborate with any team you need to.

Doing business has become complicated. The average organisation uses close to 1,000 different applications — but only 28% of these apps are integrated.

To stay ahead, your company needs to be centred around your customers and enabled by the right technology. But getting up-to-date, reliable and actionable information can be tricky. How do you translate the many streams of data coming in from sales, customer service, marketing and social media into useful business information?

With a CRM solution, of course. Here are just a few reasons why using a CRM database is important for your business.

Customer relationship management software like Salesforce CRM can give you a clear, unified customer profile — a single, simple, secure and customisable dashboard with a customer’s purchase history, order status, outstanding customer service issues and more. This information can be invaluable, especially since 70% of customers expect every representative they contact to know their purchase and issue history.

Whether they’ve previously kept in touch via phone, chat, email or social media, a single source of truth ensures everyone at your company can provide the expected level of service.

Having a single source of truth doesn’t just benefit customers: It keeps companies organised and focused on revenue-generating activities. Sales teams generate a flood of data while talking to prospects, meeting customers and collecting valuable information.

If all that information gets stored in handwritten notes, laptops or inside the heads of your salespeople, there can be serious cost implications. Details can get lost, action items aren’t followed up on promptly and customers get prioritised based on guesswork rather than data. And if someone leaves the company, unless their contacts and notes are saved in a CRM, that information — and business — may disappear along with them.

Using CRM software means less administrative work…and more time to focus on sales.

A CRM brings your teams together, sharing information that makes everyone’s job easier.

For example, marketers can use CRM tools to manage campaigns and lead customer journeys with a data-driven approach. CRM software provides visibility into every opportunity or lead, showing you a clear path from enquiries to sales. Then, commerce teams can serve up personalised offers on your website, while customer service already knows a customer's history if they keep in touch with questions.

Some of the biggest gains can come from combining CRM with the power of AI. Doing so enables you to quickly pull together everything you know about a customer — and even some things you didn’t know — which can be used to personalise every interaction. Having this level of knowledge makes every employee even smarter and more productive, especially when you use AI agents that can take action autonomously based on the instructions you provide.

AI agents can help to speed up tasks for teams across your business, too. Labour-intensive tasks like drafting sales emails, crafting marketing messages and writing or localising product descriptions can now be done in a matter of seconds.

CRMs that have AI give employees the power to make more accurate predictions around forecasts like quarterly sales targets, ecommerce sales or the best time to send a marketing email.

There are many benefits of using CRM software — especially when your business combines CRM with AI and data you can trust. Here are just a few of them:

The ability to easily share data across your teams is a huge benefit to both your customers and your business. A CRM provides everyone at your company with a simple, customisable user interface with real-time updates they can use to serve customers. So when a customer calls in with a question, the service agent can see their entire history, past marketing offers and previous purchases. The CRM can even offer up suggestions for new products the customer may like, based on trends and insights uncovered by AI. A CRM with messaging capabilities that incorporates your customer data makes it even easier to communicate across your teams, with the data you need to collaborate right at your fingertips.

Introducing a CRM platform has been shown to produce real results across a business. It helps employees save time, work more efficiently, unlock opportunities and serve customers better. Using Salesforce CRM, global customers across all business sizes have a proven track record of success, including:

An AI CRM will help your business grow. It can make your employees more efficient, serve your customers better and find new opportunities you may not see on your own. AI agents can help employees be more productive and serve customers better, with the ability to autonomously provide 24/7 customer service, engage with prospects, provide personalised product recommendations and more.

CRM software helps employees get more done, faster. With CRM automation you can streamline complex, multi-user processes into simple workflows. Plus, fully integrated productivity platforms such as Slack provide a single place where employees can collaborate right in the flow of work and automate processes. With the help of AI, the best CRM software can automatically generate workflows to create even better experiences.

By understanding your customers better, cross-selling and upselling opportunities become clear — giving you the chance to win new business from your existing accounts and to build lasting, more profitable relationships. With more visibility, you can keep your customers happy with better service. Happy customers become repeat customers and repeat customers spend more.

Today's customers expect fast, personalised support at any time of day or night. A CRM system can help you to provide the high-quality service that customers are looking for. Your service representatives can quickly access a customer’s record of all past interactions so they can provide quick, informed answers and service.

A good CRM system will gather information from a large variety of sources across your business and beyond. So in addition to providing information about individual customers, it can serve as a listening engine. Using AI can give you unprecedented insights into how people feel and what they are saying about your organisation. This helps you to improve your offerings, spot problems early and identify gaps.

CRM lets you store customer and prospect contact information, identify sales opportunities, record service issues and manage marketing campaigns, all in one central location that’s available to stakeholders at your company. It does this by organising customer and prospect information in a secure, easy-to-use digital record with information like a contact‌’s email, telephone, social media handle, all previous interactions with your company and more.

CRM helps you to find new customers, win their business and keep them happy. With automation, CRM can help you to collect even more information faster, like news about your accounts, so that everyone stays up to date.

Summary

• A CRM system organizes and stores customer and prospect data in a secure, easy access record.
• It includes details such as contact information, previous interactions and other custom fields.
• CRM helps your sales and marketing teams to acquire new customers, secure new business, and maintain existing customer satisfaction.
• Automation within CRM accelerates the collection of updated account information.

Customer relationship management software provides businesses with tools that help them to communicate better — both internally and with customers. Here’s how:

Unlike the early days, today’s CRM software lives in the cloud, giving you the ability to safely save and access all of your customer data from anywhere at any time. That means every employee has the same information in real time and can make updates wherever they are.

Shifting to a cloud CRM also means that a CRM system is easy to implement. There’s no hardware, which significantly reduces costs. Installation and ongoing management is an easy lift for IT teams, since there are no frustrating version control issues or updates to schedule. And, with cloud-based CRM, you only pay for the number of seats you use and features you need. As your business grows, you can add more of both, enabling your CRM to scale along with your plans.

Moving to the cloud has changed CRM in countless ways. Now anyone can work from anywhere on any device, boosting collaboration and bringing down costs. Plus, it offers enhanced security, so your customer and company data is always safe.

With a consolidated view of every prospect and customer, CRM software can manage day-to-day customer activities and interactions. For marketing, this means engaging your prospects with the right message, at the right time, through targeted digital marketing campaigns and journeys. Sales reps can work faster and smarter with a clear view of their pipeline and accomplish more accurate forecasting.

Commerce teams can quickly launch and scale ecommerce — from online orders to curbside pickup — for their consumer shoppers (B2C Commerce) and business buyers (B2B Commerce). And customer service agents can respond to customer needs on any channel — from the office, at home or in the field.

As we mentioned, the average company uses close to 1,000 apps — most of which can’t talk to each other. A CRM platform can connect with other business apps that help you to develop customer relationships. CRMs integrate with your favourite business tools, such as document signing, accounting and billing and surveys, so that information flows both ways to give you a true 360-degree view of your customer.

The latest CRM systems have built-in intelligence and trusted AI. They use your customer data to create customisable, predictive and generative AI experiences that automate administrative tasks like data entry and lead or service case routeing. Automatically generated insights or service call recaps help you to understand your customers better, even predicting how they will feel and act so that you can prepare the right outreach. AI can even help you to find opportunities that may be hidden in your business data.

The 9 steps we recommend all businesses take when implementing a CRM:

Step 1: Conduct a needs assessment – First, you need to define your CRM strategy and identify the goals you want to achieve with your CRM system. Consult all your stakeholders in the sales, marketing, customer service, commerce, and IT teams to understand their expectations and requirements.

Step 2: Choosing a CRM – Once you have your requirements, it's time to select a CRM platform that can fulfil them. Usually, those requirements will centre on scalability, simplicity of use, and fit for current systems.

Step 3: Planning and strategy – Next, outline your CRM implementation plan, set timelines, allocate resources (we recommend defining a 'CRM manager' as the owner of the platform and implementation process), and define metrics.

Step 4: Customisation and integration – At this point, you will configure your CRM to support business processes, build custom fields, and integrate with email, calendar, automation tools, and customer care software.

Step 5: Data migration – Typically, you'll need to preserve the historical data from your old system and transfer all your key data to the new CRM.

Step 6: Testing – Before going to live, it is important to fully test the workflows, user permissions and automation functions in the new CRM and address any issue.

Step 7: Training and support – Get your team trained. Work with a partner or use Salesforce Trailhead to ensure your teams have a high-quality experience using the CRM.

Step 8: Going live – It's time to launch the CRM processes. We strongly recommend having a CRM manager, implementation partner or IT assistance on hand to tackle any issues during the launch.

Step 9: Evaluation and iteration – Once it is up and running, it is important to periodically evaluate the performance of the system against your CRM strategy, gather feedback and refine your CRM processes to meet your needs.

A successful CRM implementation is essential in maximising the value your company will get from your new system. Depending on your business' needs, you may want to consider working with a CRM partner to avoid potential problems and mitigate risk throughout the process. Take a look at our comprehensive guide to implementing a CRM system.