What Is a CRM?

Monday, December 24, 2018
Christopher Sirk

It's a simple question that usually comes with a not-so-simple answer—what is a CRM? Quick answer: a CRM organizes your business, automates tasks so you can do the thinking, centralizes all your data and analyzes it. All this to serve customers better.

In the space of just a few years, CRMs have evolved enormously. Approachable and far easier to learn, implement, and pay for, they’ve morphed from three-letter monsters into ready-set-go software for businesses of all shapes and sizes.

Yes, they’re still mainly designed to do sales, marketing, and service. But now they do a dizzying number of other things too, like help users manage relationships between team members, vendors, partners, and collaborators.

A short history of CRM software

The ‘Uberization’ trend has hit the CRM market like a tidal wave. Developers have come into the user, offering software with friendly user interfaces and appealing niche design language. Simplicity and low friction usage now come standard.

That wasn’t always the case.

The history of the CRM reaches back to the dot.com bubble era. The first version of legacy software SAP CRM, for example, was released way back in millennial year zero, aka 2000.

Back then, all CRMs had a big learning curve and required a complete retooling of workflow.

First, you needed to train up. Then you’d have to import all your contacts onto a proprietary cloud and plug away doing data entry.  

Things look a lot different today. A small business can now implement a CRM with minimal hassle, without hiring developers.

Cloud-based CRM software has become standard. Cloud storage, automated data entry, and web/mobile cross-platform functionality have improved user experience (not to mention customer experience) dramatically. Prices have dropped too, with free, open source, and affordable professional and enterprise plans available across the market.

Legacy providers like Oracle, Microsoft Dynamics, and Salesforce have kept pace with trends, and continue to command serious market shares. But an increasingly diverse cast of new wave platforms have emerged to challenge them, too.

Bumping up customer satisfaction—CRMs for sales, service, and marketing

CRMs are generally designed to streamline and improve customer interaction, the sales process, and the running of marketing campaigns. They do this by improving efficiencies across workflow and the sales pipeline—automating tasks, and analyzing data.

CRMs provide an all-in-one solution for managing your team’s voice, chat, and email touchpoints, optimizing your website and running ad campaigns.

They track leads, customers, offers, and conversions in one place. That creates greater efficiencies in your business and dramatically increases visibility on your team, customer base, and to the broader public.

Maybe you're asking yourself "why would I choose a CRM over a customer service software?" Well, one reason would be to have a unified knowledge base, aka customer information that is collected by and accessible to multiple different departments—ex. sales, marketing, and customer service. Streamlined access to contact data and collaborative team tools help you respond and resolve customer inquiries faster and smarter.

And, if you're going for a customer service-centric CRM, considering all the customer touch points—social, chat, email, phone, and website—is essential.

Keeping track of all that data makes task automation one of the most significant advantages provided by today’s CRMs. By letting machine learning and analytics do some of the heavy lifting, you save time and keep yourself from getting burned out on cognitively distressing or low brain-activity tasks.

Making phone calls within your CRM platform automatically generates data in real time, the date, who made the call, and so much more. You’ll be able to automatically track customers and schedule follow-ups, with a centralized base for contact information.

Click to call, cross-platform functionality makes it a breeze to call from anywhere, makes your business more agile, and saves an incredible amount of money on phone bills.

Meanwhile, new developments in natural language processing and machine learning are making CRM better and better at turning phone conversations into super useful data.

For example, Dialpad, a cross-channel platform with voice, video, and messaging features, incorporates advanced AI business analytics with VoiceAI. Using speech recognition and natural language processing technology, the platform automatically and accurately transcribes sales and support calls in real time. Analytics offers immediate insight into which parts of the call were most important.

Live chat features allow you to connect with customers one-on-one instantaneously. Your customer service team will be able to access wiki-style customer information from your CRM, including past interactions, conversions, sales, and more. That means you’ll be able to respond in an informed, empathetic way every time, minimizing churn and maximizing customer satisfaction.

Zendesk Suite is a good example. It puts incoming questions from customers via email, tweets, chat, and social channels get put into one place, speeding your ability to respond and making your business smarter. The software flags conversations that need attention and lines up tickets intelligently so agents can knock them down in the right order. Records are tracked until the issue is resolved, and issues can be organized by type.

Email integration streamlines the sales process from your inbox. Platforms like Zoho and SugarCRM let you organize leads, appointments, and contacts, sync information from Gmail to your CRM, and generate follow-up reminders to close more deals.

Analytics, integration, and automation

CRMs can improve your marketing campaigns with powerful analytics and collaborative tools for visibility across your team. Analytical tools can find meaningful patterns for actionable insights, letting you run effective, targeted ads through marketing automation.

Analytical tools can help turn a lead into a customer, predicting shopping habits and determining how likely a person is to buy something again. That can prove invaluable for future marketing decisions and financial forecasting.

You’ll also gain visibility on opportunities you wouldn’t have noticed otherwise. That can influence and improve your marketing, strategy, and improve your sales forecasting.

Marketing automation cuts down work for your sales team, helps you retain customers, and grows sales. Supported by data, your business operations are coaxed towards best practice.

CRM website integration allows you to develop a more accurate portrait of customer and lead behavior. Your CRM will automatically update data and metrics, ensuring you have a complete, reliable portrait of your business. Analytic tools can offer insights on user interface and help you improve customer experience, increasing your bottom line.

Last but not least, there are the benefits of social media integration.

Social channels continue to be a key platform for advertising, customer engagement, and communication with the public at large. Hence the rise of the social CRM, which aggregate and analyze posts from Facebook, Twitter, Instagram, and more. Sprout and Hootsuite both stake their value on social media derived insights for marketing, sales, and general visibility.

The rise of the nontraditional CRM system

The changing nature of work has altered the landscape of CRM software. There’s an increasing number of platforms with non-linear, non-sales funnel oriented applications. They handle everything from personal organization to brainstorming ideas and contact management.

Airtable, for example, is an all-in-one collaboration platform that fulfills basic CRM features but is based on flexible spreadsheet functionality. It synchronizes workflow and has a range of analytic, organizational, and communications features.

The software puts a premium on creativity and personalization. Layout and workflow can be endlessly tweaked and customized. Instead of just text and numbers, tables can be filled with lists, photos, and more.

At Tesla, Airtable is the primary engine for identifying and tracking vehicles leaving its factories. News magazine Time uses it to organize all of its production schedules.

Radar, a ‘contact relationship management’ platform, was developed by a team with a creative agency background. It’s designed for businesses where talent morphs from project to project, providing a single space for organizing specialist freelance talent.

Radar emphasizes network-sharing across your business. It has a lot of potential applications, from managing freelancers to running a music label to handling photo shoots, film productions, and building up model agency rosters.

Dazed, for example, is currently using Radar for production—handling hiring and coordination of stylists, makeup artists, and art directors. Vice has two different Radar accounts, one for production and another for influencers they work with for brand partnerships.

Then there’s Milanote, which comes off as something like a cross between a mood board and a project management tool. Visually oriented and adaptable, it’s designed to appeal specifically to creatives.

In Milanote you put notes, images, tasks, files, and messages onto one platform to connect ideas. Collaborate and share ideas in-app, bridging individual initiative with team critique and insights. While Milanote isn’t a CRM, it does offer super-minimalist CRM in the form of workflow templates. The simple sales pipeline template, for example, is a basic but effective way of tracking prospects from the lead to deal stage. Milanote does this in a Kanban-style card-based view, not unlike Trello.

Followup, meanwhile, offers a personal CRM for managing contacts. Running as a sidebar in Gmail, it offers intelligent insights and reminders to keep your work relationships healthy and informed.     

Welcome to CRMLand

CRMs are about upping sales, saving time and money, and giving customers a service that they remember for all the right reasons.

Nontraditional CRMs, meanwhile, are gaining ground by catering to needs niche and holistic alike. That includes everything from nurturing collaboration across your team to managing freelance contracts, streamlining workflow, and sparking inspiration.

Whatever your business is, whatever its size, you can rest assured an appropriate CRM solution exists. There’s never been a better time to get into CRMLand.