What is CRM? Customer Relationship Management Guide

In the days before the internet, it was pretty straightforward for small business owners. Face-to-face, they could get to know their customers’ preferences directly, make the best recommendations from over the counter and take the time to answer every query. However, with more strict demand for personalisation from customers, the rise of ecommerce, and the development of technologies this has become more difficult – and that’s where CRM for small businesses comes in to save the day.

A CRM system keeps your customer contact details updated, tracks your customer interactions, and manages your accounts. By equipping your business with this data, you can improve customer relationships and continue to add value. CRM is therefore a universal tool that is useful for all your teams who interact or deal with customers in some shape or form, from sales to marketing to customer services.

Short for Customer Relationship Management, CRM is a comprehensive software solution that allows you to manage your customer relationships. From collecting customer data to strategising how best to follow up with a lead, CRM gives you the insights necessary to retain and grow your customer base.

See our guide to CRM examples to learn more about some of the tools on the market.

Customer Relationship Management (CRM) can be many things; a strategy, a process, a business goal. Here, though, we focus on CRM as a software; a cloud-based, digital tool that stores, organises, and manages data about your customers – and how they interact with your business.

At its most basic level, CRM software is a digital version of an address book – a place to securely store all contact information. Your CRM database stores all of the valuable data you have about your customers, which is produced through every action and interaction. This data includes:

A CRM database is your foundation for success. And yet, for teams focussed on crunching the numbers to analyse performance, increase revenue, and drive growth, it’s so much more – it’s the building blocks of scalability and sustainable success.

That’s because CRM software allows you to not only store your business’ crucial client, lead, and prospect data, but to use it, too. Clever CRM automations mean it can feel effortless to leverage your customer data into effective comms or sales pipelines.

Keen to learn more about the functions and features of CRM systems? check out some of the other guides in our series on CRM software plus key trends around marketing and selling to customers and providing customer service.

Regardless of whether you’re a sales guru, a marketing wizard, or a customer service hotshot, CRM software brings a series of team-wide benefits to the table. Here are just a few:

With a CRM database, you can easily locate specific information about individuals, and use that data to identify patterns and trends about your customer base as a whole. Better still, you can attach notes from previous email or live chat conversations with that customer, or a recording of your last phone call, to refresh your memory of them before your next discussion.

Using CRM software’s segmentation features, you can create tailored mailing lists, based on engagement, previous purchases, or demographic information. This allows you to deliver targeted email marketing to your customers, ensuring they get only content that’s relevant to them, and encouraging greater levels of engagement.

And, thanks to CRM software’s drag-and-drop email builder and range of preset templates, constructing eye-catching campaigns is a breeze. Take HubSpot, for example:

You don’t need to have an eye for design, or even an ounce of tech-savviness. Just click to drag a feature into your email, and add natural, compelling CTAs (calls-to-action) to give people a place to convert. Simple!

You can use CRM software to correctly manage GDPR (General Data Protection Regulation) and other data privacy requirements. Stay on the right side of the law, avoid big fines, and show your customers that you care about their data privacy. This is particularly important to get right if you’re building your own custom CRM system, without the safeguards of a branded CRM’s data-handling.

You’ll never have more fun cleaning up your pipeline. With more efficient processes, intelligent lead scoring, and a set of brilliant algorithms providing your team with the right leads at just the right team, CRM should send your sales stats skyward. Numerous CRM statistics can point towards the return on investment you’ll enjoy as a result.

Now more than ever, remote working is a key tenet for businesses. However, though your teams may already be collaborating across countries and time zones, CRM allows them to do so in real time. With everything in one place and everyone responsible for maintaining it, a CRM database makes salespeople ‘treading on each other’s toes’  a thing of the past.

Good CRM software allows you to automate not only the bare bones administrative tasks, but plenty of others, too. Modern CRM systems have automated workflows for lead nurturing, customer support, calling, and lead and deal management, plus plenty more – meaning less time spent on gruelling administrative tasks, and more time for the good stuff.

The bottom line? Your team members can focus on their specialisms – and you can concentrate on growing your business.

CRM software allows you to use data more efficiently to make business decisions, and use extrapolations to budget and plan for the long-term. You can also use that information to create stunning, aesthetically pleasing reports to wow the audience in your next presentation.

It visualises key information in intuitive, live dashboards. Within moments of logging in, you can see how many deals have been done, who’s been doing them, and how much money it’s all made you.

Connect your CRM system with your email, telephone, and other productivity tools you rely on, such as payroll, HR, and accounting software. You can also tie your CRM to your social media accounts and website to automate key processes, and speed up service.

The importance of integration can’t be overstated. As Duncan Stockdill, CEO of CRM provider Capsule, comments:

“As today’s CRM solutions connect with hundreds of different third-party software apps (from POS systems to invoicing), they also allow you to create ‘one version of the truth’ across your business, avoiding inefficient duplication of effort.

“While some may think this is only important for bigger companies, it creates much-needed efficiencies for everyone, giving start-ups more time to focus on growing their business.”

Cloud-based CRM software can cost your business anything from £12 to £200 per month. The specific cost will depend on several factors, including the size, scope, and requirements of your business, plus any initial onboarding costs during your CRM implementation process.

CRM software is commonly priced per user, per month – in other words, the more employees you’ll need using the system, the more you’ll pay. CRM software is typically tiered, with different plans available at ascending prices, each unlocking more features than the last.

Head to our dedicated resource on CRM costs to find out how much a CRM system will really cost you. Or, if you’re still wondering what cloud-based CRM software is, we’re about to explain – so read on.

An on-premise solution is deployed on your business’ premises, and you’ll own and operate all the hardware involved. You’ll get ultimate control over your own data and software, too – though you’ll have to stomach the extra costs involved, which include implementation, installation, data migration, and maintenance.

A cloud-based solution, however, lets you sidestep these fees. Your data will be stored securely on the servers of your chosen CRM software provider, and you’ll pay just a lone monthly fee to lease the software.

The big benefit of cloud-based CRM software is its dynamism. There’s nothing to install or download – in most cases, you can access all your data from a web browser. Better still, cloud-based CRM facilitates the real-time collaboration of remote colleagues, from wherever in the world they are (providing there’s an internet connection there, of course).

Hybrid solutions are a bespoke blend of the two. Better-suited to larger, enterprise-level businesses, they offer the highest levels of customisability… at a price.

Out of these options, we most recommend cloud-based CRM software. Its benefits include:

To find out which cloud-based CRM software is right for you, check out our recently updated guide to the best CRM systems for small UK businesses. Or read on, as we finish up with our top tips for selecting a CRM provider.

In order to choose the right CRM system, you’ll need to understand which functions you might use. Stel Kabouridis, a CRM expert from a large lead generation company, gives the following examples of how different businesses might use CRM software:

Any business could use CRM software to inform customers about one time offers, or other special deals.

A website, blog, or publishing-based business could use CRM software as a forum to build brand loyalty, and to promote engagement via newsletters and other correspondence.

For websites, blogs, or publishing-based businesses, we recommend Insightly.

They could also use the software as a consistent method of driving return visitors to their sites. This in turn would raise their domain authority, as well as promote their commercial pages.

An ecommerce business, or any business with multiple conversion points, can use CRM software to help with upselling. The software could also help nurture users towards a conversion – for example, a customer who has searched for “how to build a website” could eventually be steered towards an affiliate website builder they can sign up with.

If this is your goal, we recommend using our free tool to get quotes, and to help you compare and contrast the range of CRM software providers out there. It takes 30 seconds, and there’s just a couple of steps involved.

Simply provide us with a few details about what kind of CRM software your business needs. Are there specific features you require? How many users will it need to support? Let us know.

You’ll then receive quotes from leading CRM system suppliers, tailored to your business and requirements. It’s the quickest, easiest way to get matched with the right CRM software for you.

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