What is CRM? A comprehensive guide to Customer Relationship Management

CRM stands for Customer Relationship Management and refers to business software designed to manage a company’s relationships with its customers and prospects. CRM systems are commonly used by sales and marketing professionals. They help organisations streamline their business workflow using Sales Force Automation (SFA), improving efficiency and productivity, driving business growth, and increasing customer satisfaction.

This complete guide to Customer Relationship Management explains CRM’s meaning, examines its benefits, and discusses its importance for businesses today. It also provides a guide to help you select the best CRM system for your organisation and what features to look out for.

Here’s what’s included:

What is a CRM system?

A CRM system is a central hub that holds all the data for your business contacts, which might include your customers, prospects, suppliers, partners, press, and even colleagues. It is primarily used for contact and sales management.

Over time, the system will build up a history of your interactions with each contact. This might include emails, calls, meeting notes and sales. The beauty of this is that everything is in one place, creating efficiency and providing clear visibility of your sales pipeline.

CRM platform integration

The software can also be integrated with the other apps and channels you use, such as your website, digital marketing tool and accounting software. This lets you create automated workflows, replacing the routine manual processes in your business.

For example, you might use customer relationship management software to capture a new inquiry from your website, which will initiate an automated sales process. The inquiry would trigger a new record in the system, create a task for the sales team to follow up, and send the contact a welcome message.

What does CRM software do?

If by now you’re thinking this all sounds well and good, what does a CRM system actually do, and what is it used for? Here’s a simplified list:

Creates a customer-centric focus

  • Helps you find every customer, contact and communication instantly
  • Helps you deliver fast and effective customer service
  • Improves post-sales service and support
  • Increases customer loyalty and retention
  • Creates detailed history of your team’s interactions, recording who said what and when

Increases Sales and Profitability

  • Categorises and prioritises leads
  • Tracks your leads from end to end
  • Automates your sales process
  • Manages your tasks and appointments
  • Creates effeciencies and improves productivity

Improves management and communication

  • Lets you maximise your team performance
  • Helps to align your sales and marketing teams
  • Controls who has access to what data

Creates a centralised hub with everything in one place

  • Creates total visibility that puts an end to duplication
  • Enhances team and cross-team collaboration
  • Facilitates remote workforce
  • Streamlines your processes by integrating the other systems you use
  • Creates organisation and efficiency

Provides insight and reporting

  • Accurate, detailed reports and forecasts
  • Customer activity insight
  • Management of marketing ROI

Everyone in your organisation can see all the interactions with a contact in the system, including their communications, what they purchased and when, what they paid, and much more. Unless, of course, you want to limit who sees what with user permission levels!

What are the benefits of CRM?

Having worked hard to collect information about a prospect or customer, salespeople can end up with their information held across multiple sources, from sticky notes to call logs. Using a CRM tool helps bring it all together in a centralised hub. The software will facilitate team collaboration and remote working and create efficiency. The result is no duplication of effort, lost messages or forgotten callbacks. This leads to more timely communication, enhanced relationships and sales.

Workflow automation

CRM workflow automation takes over many of the manual selling processes, requiring less data input and admin. You can also use automation to prioritise your leads, combining data insights from across your business activities.

A good system will also help you manage your teams, control your data security and support your compliance with data privacy regulations.

Benefits for your business

  • Enhances contact management
  • Improves customer retention and satisfaction
  • Advances sales management
  • Increases efficiency and productivity
  • Creates organisation and team collaboration
  • Facilitates accuracy of reporting and sales forecasting
  • Heightens data insight for marketing and product development
  • Supports in-depth sales metrics
  • Boosts business growth

Why is CRM important?

Their CRM isn’t just important for many businesses – it’s essential!

To maximise the benefit, you must build your CRM strategy into your business strategy. This will create structure and organization for your company, fostering increased efficiency, productivity, and profitability.

Although originally designed for sales teams, the benefits of using a CRM across your whole organisation can be immeasurable. However, it has become increasingly important for marketers and for customer service teams to manage post-sales communications.

The software gives greater insight into how your business is performing, using the actual sales data to take the guesswork out of business decisions. It provides a complete overview of your customers and their activity, letting you create a truly customer-centric focus that will shape your customer experience strategy.

Who needs CRM software?

Customer relationship management software is relevant across many business functions and industry sectors, including the not-for-profit sector and membership organisations.

It is most commonly used in the sales, marketing and service desk functions. However, use across other teams and management may also be relevant.

Sales team

Your salespeople can use the CRM to monitor new leads in their sales pipeline, log calls and meeting notes, set tasks to follow up with customers, and create and send quotations and invoices. Sales managers will also have real-time visibility of their team’s performance against their targets, running reports and forecasts.

Marketing team

Marketers can integrate their website forms with the system to automatically capture new leads and pass them to their sales team for follow-up. They can also send automated emails to welcome new customers and monitor their responses.

Running marketing campaigns from a CRM means recording all customers’ activity back to the system. This provides insight into their behaviour and ROI analysis.

Service team

A CRM with an integrated help desk system allows you to monitor your customers’ post-sales interactions. Any support tickets raised will be captured and sent back to the customer account so your sales team can be alerted of any potential issues.

Organisations that operate business-to-business (B2B) are generally the target audience for CRM vendors, but the software can also make a difference for other markets.

How do I select a CRM?

When selecting a CRM solution for your business, you must be realistic about your IT competence, your needs, and your budget. There will be a trade-off between ease of use and the features included.

Generally, price is determined by the number of users, customer records, storage requirements, and complexity of features. Even if you can afford the best breed and would like all the features, you don’t need to commit all at once.

Understand your strategy and objectives

Your selection should reflect your strategy and objectives for the system. These might be to:

  • Help salespeople manage and close more opportunities
  • Give sales managers a complete view of the pipeline, and to automate sales forecasting
  • Safeguard ownership of the sales pipeline, a key company asset
  • Make sure that your organisation has a full picture of every sales process
  • Provide a complete picture of every customer to those that need it within your organisation
  • Run and track the effectiveness of marketing campaigns
  • Provide better service for your customers

When should you start using a CRM?

The right time to invest in a customer relationship management system will vary according to your business and industry. As a rule of thumb, you need a CRM system if you’re handling more prospects than you can remember.

You may manage thousands of customers in some industry sectors with a short sales cycle or multiple repeat sales. With others, you may have just a few hundred contacts but with a lengthy sales cycle that needs careful tracking. The system will help you track your interactions and monitor customer behaviour in both cases. This means you can effectively manage the frequency of your interactions to maximise your sales.

What features should I look out for?

The features you need will vary according to your business, and remember, not all CRMs are the same. There are different levels of features, from the very basic to those with all the bells and whistles. Price is likely to be a key factor, but it’s also worth considering which features you really need. A CRM packed with features that you never actually use will be more complicated, more expensive, and is likely to limit user adoption – one of the most cited reasons for CRM failure.

Basic CRM sales features

A basic CRM will include contact management and opportunity management. This will let you instantly find your customers and past communications and track your sales leads. However, many little extras can make all the difference in how you use the CRM. For example, look for one that you can customise with your own fields and settings to reflect your sales process.

Email integration

Ideally, you’ll want email integration included. This will automatically capture your emails to and from your contacts, giving a full history of your communication.


Surprisingly, many small business CRM systems don’t include much reporting, if any. The best systems will include a Sales Forecast report writer and a Listing Report writer for ad-hoc activity. If you cannot unlock your CRM’s insights, it becomes nothing more than a contact management system.


In today’s market, even for small businesses, CRM automation is becoming a must-have. Automation helps create efficiency and increases productivity by automating your manual processes. Your various actions in the CRM trigger workflows to complete a task according to a set of rules that you define. This might mean triggering the billing process when a sale closes or an email reminder when a warranty date expires.

You can also use automation and integration to pass data between your different systems, updating and synchronising your customer information. Here, you can use a native integration via the API or an integration platform like Zapier.

Marketing CRM integration

A CRM platform with integrated marketing lets you run email campaigns directly from your system and record your contacts’ engagement back to their accounts. Over time, you’ll build up valuable information on their behaviour and interests that will help you better meet their needs in the future.

Advantages of Cloud CRM

What is Cloud CRM? In cloud CRM, the application and data are held or hosted on the CRM providers’ servers in a datacentre and accessed via an internet browser.

As the vendor hosts and maintains the software, there are no capital costs and no maintenance for the customer. The provider can create great economies of scale by running thousands of customers’ CRM systems. These factors make a cloud-based system very affordable, with options to pay monthly or yearly, so there’s low financial risk.

The other big advantage is that cloud CRM users can access the system from anywhere via their internet browser. This might be at home, in their office, or on the go from their phone.

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