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CRM
CRM Explained: A Beginner's Guide (2024)
Liucija Adomaite
July 25, 2024
|
7 min. read
Liucija Adomaite
LAST UPDATED
May 21, 2024
READING TIME
7 min.
CRM (Customer Relationship Management) is not just a tool; it's a game-changer for your business.
In sales, CRM systems can boost revenue by 41% per sales rep and improve lead conversion rates by over 300%, states Finances Online.
Plus, CRM generates about $8.71 in revenue for every dollar spent, according to Nucleus research.
CRM software can become a revenue growth machine when used the right way, giving your business the ultimate advantage over competitors.
This article will cover everything you need to know about using CRM to unlock your business's full potential. We will explain what CRM means, how it works, its main benefits, how to choose the right one.
We will also present you 5 top CRM software to use in 2024. So, buckle up.
What is CRM (Customer Relationship Management)?
CRM or Customer Relationship Management, is a system that manages and stores all your company's customer interactions, activities, and data. It's the most effective tool to enhance sales reps' performance, create stronger relationships with clients, and boost your business revenue.
A company's CRM stores information on all interactions with customers, both existing and potential ones.
CRM platform can include information from someone's activity on your website, time when they opened your sales offer, and how long they spent looking at it.
CRM systems use technology and AI to organize, analyze, and manage data about customer interactions and activities.
The goal of CRM is to enhance customer service relationships, improve customer satisfaction, streamline customer communications, and develop stronger bonds with clientele.
Key benefits of CRM
There are numerous benefits to using customer relationship management tools and apps.
In fact, 91% of companies with more than 11 employees use a CRM system. Moreover, over 8 in 10 businesses use CRM systems for sales reporting and process automation.
CRMs are popular because they serve multiple functions and can be tailored to fit almost any business.
Here are the main benefits of implementing CRM into your business:
Build Stronger Customer Relationships: CRM prioritizes understanding customer needs and behaviors to provide them with a more personalized and positive experience.
Data Collection and Analysis: CRMs gather customer data from various sources like phone calls, emails, social media interactions, website visits, and surveys. This data is then analyzed to identify trends, understand customer preferences, and personalize marketing strategies.
Improved Customer Service: By having access to customer history and preferences, agents can provide faster and more efficient service.
Sales and Marketing Optimization: CRM systems can help target marketing campaigns and sales efforts towards specific customer segments based on their data and past interactions.
Increased Customer Retention: Effective CRM practices can lead to higher customer satisfaction and loyalty, reducing churn and increasing customer lifetime value.
Types of CRM software
CRMs are usually all-in-one software that combines various features. However, there are three main CRM types available in the market:
1.Operational CRM is a software that focuses on automation that helps businesses to streamline customer relationship processes. Operational CRMs include Agile CRM, Salesforce, Really Simple Systems and HubSpot CRM.
2. Collaborative CRM is a type of CRM that focuses on teamwork and information sharing. The goal of collaborative CRM is to foster teamwork among different departments to provide a unified customer experience. The common examples of collaborative CRM are ClickUp CRM, Dynamics 365, and Copper.
3. Analytical CRM focuses on data analysis to gain insights into customer behavior and interactions. It goes beyond simply collecting customer data and delves deeper into understanding trends, identifying patterns, and ultimately improving customer relationships and business strategies. The most popular examples of analytical CRM include Salesforce Einstein, Zendesk Explore, and Zoho Analytics.
Another type of CRM that can be included in this list is personal CRM. Contrary to other 3 CRM types that focus on customer interactions, personal CRM system is built for personal relationship management (and professional, if you feel like it.)
4.Personal CRM is a tool designed for individuals to organize and manage their personal and professional relationships efficiently. It enables users to track interactions, schedule reminders for important dates, and streamline communication with contacts such as friends, family, and business associates.
This system enhances your productivity and ensures no important task or communication is overlooked. The best personal CRM apps include Airtable, Dex, Notion, Contacts+, Folk, and Close. Find out more in the in-depth guide of the 10 best personal CRM tools to use in 2024.
CRM subtypes and other formats
Other notable subtypes of CRM software include:
Marketing CRM, also sometimes referred to as Marketing Automation CRM, is a specific strategy within customer relationship management (CRM) that focuses on marketing efforts. Marketing CRMs typically offer marketing features like lead generation and personalized communication. These apps can be a little more expensive but some sales-focused businesses may be willing to invest more in order to close more deals faster. The notable examples of marketing CRM includes HubSpot CRM and Salesforce Marketing Cloud.
Multichannel CRM allows your sales team to manage customer interactions across different channels such as phone, email, chat, social media, and so on.
Omnichannel CRM joins all these communication channels together in an integrated and unified view. Omnichannel CRM focuses on a customer-centric approach and aims to provide a seamless customer experience.
Key features of CRM
There are numerous features and functionalities a CRM system can offer. Typically, key features of CRMs include:
Customer Information Management. CRM systems store valuable customer data in one central location for easy access and management.
Contact Management. CRMs can track customer contact information and interaction history which contributes to strong customer relationship building and maintenance.
Task Management. CRMs help to manage tasks, calendars and alerts efficiently to ensure that your team doesn’t miss any sales opportunity.
Email Integration. CRM systems are often integrated with email for seamless communication and better follow-ups.
Sales Management. CRMs help track sales pipeline, visualize deal stages and analyze win and loss rates for optimized sales strategies and revenue growth.
Social Media Management. Integration of CRM systems with social media platforms enables social selling and proactive customer engagement.
Reporting and Dashboards. CRM systems provide insightful reports and visual dashboards for real-time performance tracking.
Mobile Access. Most CRM tools are accessible on mobile devices, allowing remote access for on-the-go business operations.
Third-party Integrations. CRMs can integrate with other business tools for enhanced functionality. Usually, the richer integrations, the more robust the CRM.
Customer Service. Some CRM systems can support a variety of customer service operations and help to resolve customer complaints or queries more efficiently.
Employee Tracking. CRM systems can help to track and monitor team performance and productivity.
Workflow Automation. CRMs are go-to tools for automating repetitive and manual tasks. This in turn increases operational efficiency, saves time and resources, and allows users to make more sales faster.
Overview: The best CRM software to use in 2024
Every customer relationship management software keeps track of contact information, customer deals, relationship activity, and all the steps you make in the sales cycle.
That’s its basic features. On top of them, each CRM offers a different approach to increasing your teams’ productivity. In some CRM apps it can be email marketing and lead generation, in other CRM tools it’s the priority for customer service and mobile integrations.
Below we wrapped up a list of the best CRM software for you to use in 2024 to build insightful reports, generate more leads, boost your sales team’s performance, implement AI, and save time thanks to automation.
Hubspot CRM is a robust, comprehensive, and user-friendly platform that centralizes sales, marketing, and customer service. It's aimed at small to medium-sized businesses that are experiencing growth.
HubSpot is renowned in the CRM industry for its flexibility, serving various industries with tools that cater to different business needs. While it's accessible for free, advanced features come at a cost.
It's ideally suited for small to medium-sized businesses for affordable CRM management and businesses seeking an all-in-one CRM solution. HubSpot CRM will also benefit businesses focused on inbound marketing.
When it comes to its functions, HubSpot CRM stands out for automation, simplifying various aspects of sales, marketing, and service processes. The suite includes Marketing Hub, Sales Hub, Service Hub, and Operations Hub, which makes it an excellent unified solution for seamless operations.
More than 205,000 businesses in 135 countries currently use HubSpot. Notable companies using HubSpot CRM are eBay, DoorDash, and Reddit.
Rating:
Capterra - 4.5/5 ⭐⭐⭐⭐⭐
Here are the key features of HubSpot CRM:
Contact and Lead Management that allows for detailed profiles and a timeline of interactions for each contact.
Email Tracking and Engagement provides insights into email opens and engagements for timely follow-ups.
Pipeline Management helps to create visual and customizable sales pipelines to track deal progress.
Marketing Automation and Email Campaigns facilitate automatic email campaign creation based on user data and behaviors.
Reporting and Analytics offer deep insights with over 90 essential reports available even in the free account, covering sales activities, marketing performance, and customer service efficiency.
Task Management helps you to manage day-to-day to-dos and simplifies the handling of daily tasks.
Campaign Tracking and ROI analysis thanks to integrations with platforms like Facebook and Google. Overall, it has rich integration capabilities.
Live Chat and Communication Channels with a chatbot builder offer you instant visitor engagement.
Salesforce CRM is a powerful, expansive and all-in-one cloud-based software. It offers a huge variety of operational CRM tools for sales processes and collaborative work. Salesforce is scalable, easy to use and robust CRM platform which needs no introduction. In fact, it's the oldest and most established CRM software recognized across different industries.
Salesforce CRM is a powerhouse in the CRM market. Salesforce CRM caters both small businesses and FORTUNE 500 companies and has over 150,000 customers.
In 2023, approximately 50% of Salesforce customer relationship management (CRM) software customers are located in the United States, the data shows. The biggest companies that use Salesforce are Amazon Web Services, U.S. Bank, Walmart, Toyota, BMW, L'Oreal, American Express and others.
Rating:
G2 - 4.3/5 ⭐⭐⭐⭐
Capterra - 4.2/5 ⭐⭐⭐⭐
Key features of Salesforce CRM are:
Marketing Automation: Tools for expanding audiences and enhancing lead quality.
Email Marketing: Customizable templates and campaign management.
Audience Discovery: Data sharing and audience targeting enhancements.
Contact Management: Comprehensive contact database with detailed histories.
Opportunity Management: Deal tracking and pipeline management.
Workflows: Automation features for sales and support.
Customer Support: Integrated support features including AI-enhanced workflows.
Self Service: Branded portals for customer self-help options.
Einstein AI: Advanced AI for sales forecasting and lead prioritization.
Analytics and Reporting: Customizable dashboards for real-time insights.
Mobile App: Remote access to CRM functionalities.
Integrations: Compatibility with a wide range of external SaaS platforms.
Zoho CRM is a feature-rich operational CRM notable for relatively affordable pricing and user-friendly interface.
Zoho CRM suits the needs of businesses of different sizes and industries. It offers customizable modules, social media listening tools, easy automation, rich integrations including with Facebook, Google+, and Twitter. In general, Zoho CRM is a great CRM for automating sales and marketing workflows.
Rating:
G2 - 4.1/5 ⭐⭐⭐⭐
Capterra - 4.3/5 ⭐⭐⭐⭐
Key Features of Zoho CRM are:
Sales and Marketing Automation: Automates repetitive tasks to streamline sales and marketing workflows, enhancing efficiency.
Product Customization: Allows for the creation of tailored solutions including layouts and homepages to meet specific business requirements.
Free Plan Availability: Offers a forever-free tier for up to three users, making it an attractive choice for small businesses or startups.
Artificial Intelligence Integration: Advanced AI tools for premium accounts (Enterprise and Ultimate plans) assist in customer engagement prediction and call transcription, although these features are restricted to higher-tier plans.
Mobile Accessibility: Zoho Solo setup on mobile caters to micro businesses or freelancers, providing essential CRM functionalities like contact management, tasks, and invoicing on the go.
Add-Ons and Integration Zoho CRM boasts a wide array of integration options with top-tier external services, including Shopify, HubSpot, UPS, Salesforce, and Etsy, besides connections to Zoho's internal products like Zoho Desk and Bigin.
Free version for small teams (limited to three members)
Includes Zoho’s AI assistant Zia
4. Pipedrive : the best easy to use CRM for sales teams
Pipedrive is a cloud-based operational CRM that stands as an all-in-one pipeline. It features customizable pipeline management tools, contact management and lead tracking features, sales activity monitoring, information sync across channels, and more.
It’s also important to note that Pipedrive CRM is generally less complex and has a lower learning curve than HubSpot CRM and Salesforce. Pipedrive CRM is used by 100,000 businesses in 179 countries.
Rating
G2 - 4.2/5 ⭐⭐⭐⭐
Capterra - 4.5/5 ⭐⭐⭐⭐⭐
Key features of Pipedrive CRM are:
Visual Sales Pipeline: Pipedrive is known for its visual sales pipeline interface, which allows you to see all your deals at different stages in a customizable pipeline. This provides a clear overview of your sales progress and helps you identify bottlenecks.
Drag-and-Drop Functionality: You can easily move deals between stages in the pipeline with a drag-and-drop function, making it intuitive to update deal statuses.
Customizable Stages: You can customize the sales pipeline stages to match your specific sales process.
Lead Capture Tools: Pipedrive offers various tools to capture leads, including web forms, chatbots, and live chat features.
Lead Scoring: Qualify leads based on their behavior and interactions with your website or marketing campaigns.
Lead Nurturing: Automate email drip campaigns and nurture leads until they are sales-ready.
Email Integration: Integrate Pipedrive with your email provider to send personalized emails directly from the CRM.
Workflow Automation: Automate repetitive tasks like sending follow-up emails, assigning leads to salespeople, or updating deal statuses.
Sales Forecasting: Pipedrive provides sales forecasting tools to help you predict future sales based on your pipeline data.
Contact Management: Store and manage all your customer contact information in one central location.
Activity Tracking: Track all customer interactions, including calls, emails, and meetings.
Reporting and Analytics: Generate reports on your sales performance, identify trends, and measure the effectiveness of your sales activities.
Mobile CRM: Access your CRM data and manage your sales pipeline on the go with the Pipedrive mobile app.
Product Catalog: Create and manage a product catalog within Pipedrive to easily add products to quotes and invoices.
Integrations: Pipedrive integrates with a variety of third-party applications, such as marketing automation tools, accounting software, and email providers.
5. Agile CRM : best free CRM software for small teams
Agile CRM is an easy-to-use and powerful yet affordable customer relationship management system with sales and marketing automation for small teams.
Its free plan allows up to 10 users to access some robust features, including access to 1000 contacts, unlimited deals, tasks, documents, andappointment scheduling. You can customize your dashboard, share data, launch your first campaign, and qualify your leads.
Agile CRM's free plan gives you apleasant360-degree contact view with Facebook-style timelines. Moreover, its contact management functionality provides next-gen capabilities that can boost your ROI.
Rating:
Capterra - 4.1/5 ⭐⭐⭐⭐
G2 - 4.0/5 ⭐⭐⭐⭐
Key features of Agile CRM (free plan) are:
Email Marketing and automation
Web Forms and Popups
Google Apps Sync, Including Gmail
Online Appointment Calendar
Free Plugin of Your Choice
Deals and Sales Automation
Cloud CRM vs On-premise CRM
This is what you need to know about the differences between the two modes of CRM, cloud-based and on-premise, commonly used by companies. The major difference between them is how they are hosted and how the users access them.
While more and more teams are switching to cloud CRM systems, on-premise CRMs are still popular among specific business industries like financial services (banking, investment, insurance), healthcare, and government agencies. It's due to the fact that on-premise CRM gives you complete control over the system, including user data and privacy.
Cloud CRM is a system that you can access from anywhere as long as you have an internet connection. It’s ideal for remote and hybrid teams because of how flexible it is. This kind of software solution is also known as SaaS (Software as a Service). Cloud-based CRMs constantly evolve and upgrade to cater to the ever-changing needs of their users.
Cloud CRM systems usually focus on releasing new features, capabilities and integrations to help increase your return on investment (ROI). Cloud CRM apps always put an emphasis on user experience, refining interfaces, and fixing bugs. Most of them also have security patches that protect customer data. Popular examples of Cloud-based CRM include Pipedrive and HubSpot CRM.
On-premise CRM is a system that requires users to be close to the server. On-premise CRM typically has a higher up-front cost since it requires an advanced IT infrastructure, including hardware and servers, set-up, staff resources, and continuous maintenance and so on.
On-premise CRM examples include Oracle Siebel CRM which is a widely recognized CRM platform known for its scalability and robust functionalities. Another example of on-premise CRM is enterprise-grade CRM, also known as SAP Customer Experience.
CRM vs ERP
CRM is software that manages all the ways a customer interacts with a business. At the beginning of CRM era, CRM functions were designed for sales departments and they were called sales force automation (SFA).
CRM's key functions are:
Contact Management: Stores and organizes customer data.
Sales Pipeline Management: Tracks leads, deals, and opportunities throughout the sales process.
Marketing Automation: Automates marketing tasks like email campaigns and social media marketing.
Customer Service Management: Tracks customer inquiries and facilitates efficient resolution.
Customer Insights: Analyzes customer data to understand customer behavior and preferences.
ERP (Enterprise Resource Planning) is software that runs an entire business and serves as a shared database for all the parts of an organization. It supports automation and processes in finance, human resources, manufacturing, supply chain, services, procurement, and more.
ERP key functions are:
Financial Management: Tracks income, expenses, and financial transactions.
Supply Chain Management: Oversees procurement, inventory management, and logistics.
Human Resource Management: Streamlines HR processes like payroll, benefits administration, and recruitment.
Project Management: Tracks project progress, resources, and budgets.
Reporting and Analytics: Provides insights into overall business performance across departments.
The most important CRM terms in 2024
When choosing the best CRM tool for your business, you will encounter many of these CRM-related terms that are crucial in understanding how CRM works.
Customer Journey is the complete process a customer goes through when interacting with your business, from initial awareness to purchase and beyond.
Customer segmentation means grouping customers with shared characteristics, behaviors, or needs to tailor marketing campaigns and interactions.
Customer Lifetime Value (CLTV) is the total revenue a customer is expected to generate over their entire relationship with your business.
Customer satisfaction is a measure of how happy and satisfied customers are with your products, services, and overall experience.
Lead is a potential customer who has shown some interest in your product or service.
Lead Generation is the process of attracting and identifying potential customers.
Lead Conversion is the process of converting a lead into a paying customer.
Sales Pipeline refers to different stages a lead progresses through before becoming a customer such as prospect, qualified lead, opportunity, and close.
API (Application Programming Interface) is a set of protocols that allows different software applications to communicate with each other.
CRM pricing: how much will a CRM cost?
Here's a breakdown to help you understand how CRM systems are typically priced.
CRM pricing models usually are:
-> Per User, Per Month: The most common pricing model charges a monthly subscription fee based on the number of users who will be accessing the CRM system. Prices typically range from around $5 per user/month for basic plans to $150 or more per user/month for enterprise-level plans with advanced functionalities.
-> Tiered Pricing: Many CRM vendors offer tiered pricing plans with different feature sets. Higher tiers come with more advanced functionalities and usually cost more per user per month.
-> Freemium Model: Some CRM providers offer a free tier with limited features, which is ideal for very small businesses or those just starting out. Paid plans with more features and user capacity are available for an upgrade fee.
What affects the cost of CRM:
Number of Users: The more users who need access to the CRM system, the higher the overall cost will be.
Features: CRM systems with more advanced functionalities, such as marketing automation, sales forecasting, or advanced analytics, typically cost more.
Deployment Options: Cloud-based CRM systems are generally more affordable than on-premise solutions that require hardware setup and maintenance.
Customization: Customizations or integrations with other business applications may incur additional costs.
Scalability: Choose a CRM system that can scale with your business needs. Some CRM vendors offer flexible pricing plans that allow you to add or remove users as needed.
Here’s roughly what you can expect to pay for the CRM suite:
Basic CRM (Free or up to $30 per user/month): Suitable for very small businesses or startups, with features like contact management, basic reporting, and task management.
Mid-Tier CRM ($30 to $100 per user/month): Ideal for small and medium businesses, offering features like sales pipeline management, email integration, and lead scoring.
Enterprise-Level CRM ($100+ per user/month): Caters to large organizations with advanced functionalities like marketing automation, workflow automation, and customizable dashboards.
Our advice is to take advantage of a variety of CRMs’ free trials and demos before making a commitment to a paid plan. Another important thing to note is that there may be hidden fees like setup costs, data migration charges, and even training fees. Long-term cost for your business is also something to consider.
How to use CRM to get the most out of it
Implementing CRM software into your company if you never used it before can be challenging. Especially, if you don't know what goals you want to achieve with it.
In order to make sure your team is in sync when switching to a customer relationship management tool rather than trying to work on all the processes manually, you have to have a plan ready.
These are the key steps in making sure a CRM system benefits your business and brings ROI ASAP:
1. Add Your Sales Team to the CRM.
The first step in utilizing your CRM system is to include all the sales representatives in your team. This ensures that your data is comprehensive and accurate. To fully leverage CRM software, your sales team must understand how it works, its benefits and believe in its value.
2. Customize Settings to Reflect the Sales Process.
The CRM settings should be tailored to map the stages in your customer's journey. These stages could include 'lead', 'opportunity', 'customer' and more. To do this, you first need to have a clear understanding of your sales process.
Once you've defined your stages (e.g., Connect, Qualify, Demo, Close), you can create deal stages in your CRM pipeline for each. Along with this, create custom properties for the unique data related to your business. Lastly, adjust the currency setting if necessary.
3. Import Existing Contacts, Companies, and Deals.
Import all your existing customers' data into your new CRM including data stored in your old CRM platform or in the spreadsheets.
Most CRMs allow data importation through a CSV file upload, make sure you use it. Ensure that each column aligns with an equivalent property in the CRM for easy and smooth data transition.
4. Integrate Other Tools with Your CRM.
Centralize all the information about marketing, sales, and customer services in your CRM to get a 360-degree view of your prospects and customers.
This step streamlines work and minimizes manual data entry. This could mean integrating different tools that you already use with your CRM or using platforms like Zapier to make the integrations.
6. Customize Your Dashboard.
It will help you to get a clear overview of how your team is performing. The metrics displayed on your dashboard should be directly related to your sales goals and processes, so make sure to keep an eye on them.
For instance, if you are targeting to increase sales of a particular product, you may want to see that product's sales statistics on the dashboard.
7. Set Up Regular Reports.
You can easily set up your CRM to generate and send out daily, weekly, monthly, or quarterly email reports as required. Reps might receive a daily email showing their individual performance against the team's overall achievements, fostering a healthy and motivational competitive environment.
These reports could track the completed activities by each rep, emails sent/received, calls made, deals won, and retention rates. It will show you the big picture and will unify your customer-centric efforts among the departments.
8. Make Your CRM Customer-Centric.
When integrating the new CRM in your business processes, it's crucial to make sure that this system brings value to your customers. After all, this is why you decided to implement CRM in the first place.
Frequently Asked Questions (FAQs)
What are the three types of CRM?
There are three main types of CRM software: operational CRM systems, collaborative CRM systems, and analytical CRM systems.
What is an example of a CRM?
Salesforce Sales Cloud, Zoho CRM, and HubSpot CRM are all popular examples of CRM.
What is the best free CRM?
The Best Free CRMs of 2024 are the following:
Insightly: Best for opportunity management.
Agile CRM: Best for Integrated marketing solutions.
Bitrix24: Best for unlimited free users.
EngageBay: Best for live chat.
FreshSales: Best for robust features.
Do I need a CRM?
Yes. Most businesses benefit from using CRM software. CRM generates about $8.71 in revenue for every dollar spent, and when used in sales, can boost revenue by 41% per sales rep, improving lead conversion rates by over 300%, and decreasing spending by 23%.
How will CRM affect my ROI?
CRM offers a strong return on investment by boosting sales, enhancing customer retention, reducing costs, and improving overall business efficiency. When implemented effectively, a CRM system can be a powerful tool for driving long-term business growth and profitability.
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A CRM system supports sales, while a CDP creates a more complete view of customer relationships beyond the sales cycle. But they are most powerful when used together.
CRM methods are practices businesses use to manage and analyze customer interactions and data throughout the lifecycle. This is what you need to know about the most effective ones.
It’s impossible to remember everything and everyone, and you don’t have to. A personal CRM does it for you. It organizes meaningful personal relationships, such as colleagues, friends, family, and private business acquaintances. This article features the top 10 personal CRM tools everyone uses in 2024.
CRM, or "Customer Relationship Management", is a software system that manages all customer relationships. The goal of CRM is to build and nurture stronger relationships with your leads and clients. Using CRM can increase work efficiency, enhance sales teams' performance, make your customers more satisfied, and boost sales.
Liucija Adomaite
Jul 25, 2024
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