What is CRM?

cloud computing CRM. It’s an acronym you hear often in the business world. But what is CRM? Let’s start with the abbreviation — CRM stands for “customer relationship management”. It is a software technology that allows for the communications tracking as well as descriptive attribute management of potential and existing customers and clients. That is, what you know about and your relationship with your customer. Prior to the mid-1990s, CRMs were known as salesforce automation systems or SFA. The main goal with a salesforce automation system is simple – to streamline the selling processes so that management could assess if sufficient sales offers to possible customers were being made and accepted. Past the mid-1990s, these systems grew to become more comprehensive – and ultimately CRMs were the choice to track the more speculative aspects of businesses – ie, marketing initiatives and post sale activities, such as customer service.

Organizing Customer Communications

But let’s go a little deeper into what a CRM does. A CRM system is most concerned with the customer record and managing the communications with that customer. Now, there are a lot of different forms of communications that occur with a customer. Typically, these customer communications fall into these kinds of categories: web form inquiries, phone calls, emails (as-needed or scheduled), meetings, advertisements, postal mail, and these days, texts.

This is a lot of different kinds of information, and as you can imagine, all of this communication can get easily lost or separated. This is where a business management CRM comes into play.

A business management CRM allows a company to track these various form of customer communications – all in one place. With the information about all your prospects and customers together, coupled with a record of the communications, you can design targeted action to address customers that are most likely going to purchase your products. Without the CRM tools, it can be nearly impossible to develop and execute on quality action that should lead to revenue-based success.

Tracking the State of Customers Before They Make a Commitment

What a business management CRM does is track the lead inception (first point of contact) to the end of communication where transaction occurs. Here’s an example: you received a lead from an online source. That lead is placed within the CRM system. From there, you were able to easily record the types of communication that have occurred with said lead. Perhaps you have sent an email, or you have reached out to them via telephone. Or you have sent them additional information via postal service. Whatever the type of communication, your business management CRM will easily track it. If you know that leads generally are more willing to speak and buy after receiving an email, you can design a phone campaign to call prospects shortly after performing an outbound email campaign.

Identifying Roles Within the Marketing and Selling Processes

Another key function of a business management CRM is being able to identify and assign roles within the customer communications process. If you have a team dedicated to email blasts (marketing) and another team dedicated to sales, the CRM shares this information among all members. That means your sales team can see an email was sent to during a marketing campaign to a specific prospect while the email team can find and identify specific sales conversations for that same prospect. In essence, your teams are able to cross communicate – without ever having to directly talk to each other — instead, they learn what is going on in the business and its customers through the CRM business management system.

Copyright © Marty Zigman 2011

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Marty Zigman

Holding all three official certifications, Marty is Southern California's NetSuite expert and leads a team of senior professionals at Prolecto Resources, Inc. He is a former Deloitte & Touche CPA and has held CTO roles. For over 25 years, Marty has produced leadership in ERP, CRM and eCommerce business systems. Contact Marty to set up a conversation.

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| Tags: , , , , , , , , , , , , | Category: CRM, Management | 2 Comments

One Comment

  1. Posted July 25, 2013 at 4:33 am | Permalink

    Great..perfect defination of CRM … another one is MobyCRM is your one stop Hosted CRM Software.

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  1. […] Microsoft Dynamics is a marketing name for a bunch of business applications that include one CRM and and four (that we will focus on) ERP systems.  Only one, the CRM, was created from the ground […]

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