Customer relationship management (CRM) is a process or system used by organizations to handle interactions with current or potential customers.
CRM also refers to the software used to implement such customer relationship management processes. CRM software supports four central functions: customer service, digital commerce, marketing, and sales.
Deeper Definition
Customer relationship management consists of three things:
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Customer: The people that your organization exists to serve.
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Relationship: The sum of all interactions with each customer. This includes any contacts related to sales, marketing, and customer service. Relationship data includes call logs, letters, emails, phone calls, social media activity, and data from cookies.
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Management: The way you use data to improve relationships and extend the customer lifecycle.
The information you store about each customer tells you a great deal about that relationship. You can study what they purchase, what issues they have, and what kind of marketing messages have connected with them.
Data is the essence of customer relationship management. CRM software can plug into a wide range of channels and capture any data that relates to customer interactions. Staff can also use the CRM to log notes and manually update customer details.
The functionality of CRM software depends on the amount of data available. When there is little data on hand, the software is limited to basic functions like contact management: storing customer information and managing communication preferences.
When there’s a substantial amount of data available, CRM can perform a broader range of functions. Examples of such features include:
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Sales enablement: CRM can aid the sales team through lead scoring, pipeline analysis, and sales attribution.
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Marketing automation: The entire marketing process can be marketed end-to-end. This includes lead generation, audience segmentation, and message sequencing.
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Customer self-service: Customers can perform some operations themselves, via a user interface. For example, a customer could log into the website and update their communication preferences.
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Demand forecasting: Customer data can help you to accurately predict variations in customer demand, improving the accuracy of resource planning.
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Analytics: With very large volumes of customer data, you can perform detailed analytics. This will reveal customer trends that will help you identify any areas where you need to improve. Analytics can also reveal where there are hidden opportunities, such as when customers have an unmet need.
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Integration: CRM can be a central pillar of your IT infrastructure. CRMs import customer data from a number of sources and store it in a single format. This data can be exported to other systems, such as ordering systems and Enterprise Resource Planning (ERP).
Customer Relationship Management (CRM) Examples
Salesforce is by far the world’s most popular CRM, mostly due to the ease of integration with other systems. Salesforce is a fully cloud-based Software-as-a-Service (SaaS).
Other popular CRM software products include SAP CRM, Oracle CRM, Adobe Marketing Cloud, Microsoft Dynamics, and Base CRM.
Xplenty integrates with a number of well-known CRMs, including Salesforce and Base CRM.