What is CRM? Definition, benefits & tips

For any business, establishing and nurturing a strong relationship with customers is vitally important. Customer relationship management (CRM) is a powerful tool that enables organisations to do just that.

CRM processes and systems enable businesses to build meaningful connections, streamline operations and drive growth over time.

In this article, we’ll be exploring what CRM is, and why it matters to businesses in every sector or industry.

CRM definition

Customer relationship management, more commonly referred to as CRM, is an approach to customer service that allows businesses to manage and improve their interactions with customers.

CRM involves making use of technologies and processes to acquire customers, retain them and then improve their relationship with your brand.

Ultimately, the goal of a CRM strategy is to improve customer satisfaction and loyalty, improving profitability in turn.

One of the key reasons that CRM matters is that, often, the value realised by retaining existing customers is greater than the value of acquiring them in the first place.

Key CRM features

There are a range of features that are considered to be standard to a CRM process. Take a look at the sections below to find out more.

Customer data management

By using a CRM system, businesses can collect and organise customer data. This can include things like contact information and purchase history, and even insight into customer preferences and other behavioural metrics.

Exactly what you track will depend on various factors, including the permissions you ask customers to opt into as well as the sort of business or website you operate.

The data you do have can be centralised and used as a single source of truth for your business, allowing you to understand and analyse customer behaviour. This data can be used to improve your overall website marketing strategy, as well as to improve specific parts of the customer experience.

Sales automation

CRM platforms often provide tools that will help your business to streamline, or even automate, sales processes.

These tools can include lead management, opportunity tracking, sales forecasting and pipeline management. Combined, these functions can help teams to identify priorities and to efficiently convert leads into customers.

Marketing automation

CRM systems can also help to automate marketing activities, including email marketing campaigns.

Using a CRM system will help with lead nurturing and can enable personalised messaging, and advanced customisation to make sure your messaging hits in the best way possible.

Combined with the customer data businesses collect, it’s possible to segment audiences to target specific customer groups with tailored marketing messages likely to drive the highest level of success.

Customer service

Often, CRM systems will enable efficient customer service by integrating with various channels, including phone, email and social media.

This sort of function provides a unified view of customer interactions and can feed your business’s understanding of how people engage with your organisation.

Using CRM systems, you or your staff can quickly access customer information to provide immediate support, track ongoing support and provide personalised assistance where necessary.

This level of functionality can massively improve the experience your customers have, building their trust in your organisation over time.

CRM analytics

CRM products normally offer a high level of analytic data that you can use to gain insight into customer trends and behaviours.

Using this data, companies are better placed to make data-driven decisions, identify opportunities and fine-tune marketing or sales solutions to more closely match their customers’ needs.

CRM benefits

When used in the right way, a CRM process or tool can offer a range of benefits to businesses of any size. Take a look at the sections below to find out more.

If you’re interested in comparing brands, you might want to check out our best CRM platforms page.

Improve customer relations

CRM enables businesses to gain an overview of their customers, allowing them to personalise interactions and better understand their needs.

By delivering improved customer service, and by building relationships with users, businesses can improve customer satisfaction and loyalty.

Improve efficiency

Thanks to the automation and streamlining of processes that can be done with CRM systems, businesses can reduce the number of manual tasks they need to complete. This can be a massive time-saver and can even reduce the cost of activities.

Increase sales

CRM platforms provide visibility into the sales pipeline, offering insights and benchmarks as to where specific user groups are sitting.

With this information, sales teams can identify opportunities, prioritise their leads and close more leads. Over time, this can lead to improved sales performance and increased revenue.

It is worth bearing in mind that many businesses will take time to perfect this process though; it may not be a simple plug-in-and-go experience for your organisation. Be prepared to learn what works and what doesn’t.

Effective marketing

Through the data they provide, CRM systems can empower businesses, and the marketing teams within them, to target the right audience with the right message. This can lead to improved engagement rates, in turn driving a higher return on investment.

By tracking and testing your marketing strategies, CRM can help you to perfect your messaging and targeting to drive even better results.

Data-driven decisions

CRM processes and platforms offer valuable insight that can help businesses to make informed decisions.

By understanding customer preferences, behaviour patterns and market trends, organisations can refine their strategies to drive growth.

This level of data can also inform other areas of your online strategy. For example, with CRM data you might be able to uncover common pain points that can be addressed with an effective SEO strategy, where content is generated to answer questions users might have.

Likewise, the data you gain from a CRM can provide some direction for how you conduct your search engine marketing operations, providing insight as to what sort of new audiences and keywords you might want to target to improve results.

Data-Driven Decision Making: CRM analytics offer valuable insights that help businesses make informed decisions. By understanding customer preferences, behaviour patterns, and market trends, companies can refine their strategies and drive growth.

What is CRM? Final thoughts

Customer relationship management (CRM) has become an integral part of modern business operations. It has massively improved the way that customers interact with their customers, providing a whole host of options to improve retention and satisfaction.

By making use of the technologies and data on offer, CRM systems can be used to build strong customer relationships, enhance operational efficiency and drive growth.

A good CRM strategy can empower businesses to gain a competitive in a world where customer satisfaction is still one of the most important things you need to preserve in order to succeed.

Bryn Glover

Bryn is the founder and editor of WebsiteJumpStart. He has worked in the digital field for over a decade and was editor for Startups.co.uk - the UK's leading small business website - and for NerdWallet UK before launching WebsiteJumpStart to help people and businesses get online with ease.

Content brief template

Whether you run a personal or small business website, creating engaging and interesting content is vital to engaging with your audience and hitting your goals. Every page on your website will have content of some kind – from your homepage and about us page to product listings or articles.

July 18, 2024 No Comments

What is Google Search Console? Definition, features & benefits

Search engines play a crucial role in connecting users around the world with relevant information. As the most popular search engine globally, Google holds a dominant position in this area. For that reason, understanding how a website performs in Google’s search results is essential for businesses and digital marketers. This

October 11, 2023 No Comments

What is Google Analytics? Definition, features and benefits

Google Analytics (GA) is a valuable tool that offers website owners and managers access to data and insight to help them monitor the performance of their website or websites. A comprehensive website analytics platform, GA provides information on a range of metrics covering everything from how much traffic your site

October 10, 2023 No Comments

What is keyword tracking? Definition & tips on how to do it

Keyword tracking is an essential part of search engine optimisation which allows users to monitor the performance of their site for specific keywords. Typically, this would involve keeping an eye on how your site ranks for specific keywords on Google, but also monitoring how the keywords themselves change over time.

August 24, 2023 No Comments

Best CRM software 2024: Compare top business picks

Maintaining strong customer satisfaction is vital for any business. The best CRM platforms offer a range of tools for businesses of all sizes to help manage interactions, streamline processes and improve customer happiness. With a range of customer relationship management (CRM) options available, it can seem tricky to choose the

August 16, 2023 No Comments

What is email marketing in 2024? Definition, benefits & strategies

Email marketing is a powerful tool for online businesses and individuals. It allows them to reach their target audience with relevant content and information that, over time, can help to develop meaningful connections. So, what is email marketing? Though it might not seem like a new tool, compared to social

August 8, 2023 No Comments

Table of Contents