What is a CRM?

What is a CRM?

Let’s start with the basics.

CRM stands for Customer Relationship Management. It can be both a business philosophy and a piece of software you use to manage your customer relationships.

Now we’ll dig a bit deeper into both.

CRM as a philosophy

When you look at CRM as a business philosophy it means putting the customer at the center of your organization. It’s about building close relationships with customers using their preferred channels and regularly communicating with, rather than talking at them.

When you’re close to the customer, you can easily assess every decision through their eyes. You can balance their needs and wants with the commercial drive of a business, which improves the end result.

With so many customers and so many channels, to develop these deep customer relationships and insight requires a whole lot of data analysis from multiple channels. That’s where the CRM software comes in.

CRM software

CRM software keeps track of all your customer interactions across multiple channels and stores them in one central place, for everyone can access.

In its most basic form, a CRM manages all your customer contacts. It organizes them so you can create groups to target. As you know, there are lots of software companies such as email providers that hold customer data and can organize them into different groups too, but that doesn’t make them a CRM.

You see it’s the ‘Relationship’ part of a CRM that makes it so unique.

With a CRM your contact management goes much deeper. It connects people to organizations, partnerhips and anywhere you need it to. This sophisticated structure goes beyond the simple contact details for each person and you start to see the big picture. Within each contact you can also store all your interactions, notes and documents related to that person.

This helps you build a 360 view of each customer.

When you fully understand your customer, you can communicate on a deeper level. You’ll respond to their needs more effectively and be more able to deliver a stellar customer experience and make them feel valued.

A CRM tracks how well you look after your customers and highlights those that may need more love before it’s too late. In fact a CRM can pull in data from any source and help you track any aspect of your customer’s journey so you can uncover meaningful insights.

Examples of the types of information you can store in a CRM include:

  • Contact details: name, address, email, phone number
  • Email conversations such as Mailchimp
  • Meeting notes
  • Social media interactions
  • Preferences, interests
  • Number of enquiries or sales leads
  • Purchase history
  • Customer health score
  • Help desk queries or tickets
  • Financial data such as proposals or invoices from Xero or QuickBooks Online

The list goes on.

Who needs a CRM?

If you have customers and you no longer know the details of each one personally or you find you’re missing new business leads as there are too many to handle, you need a CRM system.

It’s the only way you’ll be able to deliver a positive experience to your new and existing customers. Customer expectations are very high, people expect an immediate response to every enquiry, anything less isn’t good enough.

If you use disparate tools to manage your customer communication channels, things can start to fall through the cracks and you’ll miss opportunities.

When you have a small number of customers to manage you’ll naturally know each customer inside out. But this becomes impossible at scale and that’s when you need a CRM.

CRM for one view of the customer

A CRM gives you the big picture of your business by giving you a complete view of your customers. You can simply store customer information as you collect it or connect your CRM to other software. When you connect, data is automatically pulled in from different sources, so you get a full picture of your customer without any manual data entry.

Having one source of truth for all your customer data for all to access is life changing for a business. Opportunities are never missed and people are fully informed when they speak to customers, providing a first class experience that builds loyalty.

A customer profile in Capsule with historical interactions listed

CRM for contact management

One of the fundamental uses of a CRM system is contact management. Not only can you store all your contacts in one place, after all an address book does that very well, you can create relationships between people and the organizations they work or connect up their partnerships.

You can segment your contacts and group them on specific characteristics, helping you target them more effectively with more personalized messages or offers.

And a CRM contact record can hold an unbelievable amount of data from notes, email conversations, proposals, contracts and any other relevant information you wish to store.

The best CRMs make this data look beautiful and easy to understand.

CRM to keep you organized

Organizing your contacts is one thing but what about organizing your day too? A CRM is fantastic at keeping you on track with simple task management features.

You can usually create tasks for a person, an opportunity, even a project and allocate them to different people in your team. Most CRMs have a calendar function too, where you can view all your tasks in one place.

It’s amazing how a simple task list can keep you organized. Read more about the power of tasks in a CRM and how they improve your productivity.

CRM for marketing and sales

A CRM helps you manage your leads and track then right through to sale. You can map out your whole lead to sale process in your CRM and it’s usually presented in a pipeline.

Once you have visibility of all your sales leads, the time they take to convert plus the conversion rate, you can start to forecast your sales and project future business growth.

The pipeline is a phenomenal tool. You’ll easily see the leads that get stuck alongside those that fly through and analyze the activity that affects both. You can then start to share best practice.

Find out more about the sales pipeline.

CRM software also automatically create reports on all your sales opportunities, activities and forecasts so you get a clear overview of all the potential business coming your way and how long it will take to convert. This is critical to successful business planning.

pipeline forecast bar chart

CRM for other departments like HR

A CRM is not just for sales and marketing. Other departments such as HR can benefit too. Candidates can be grouped under specific roles they’re interested in or by skill sets. All their documentation and feedback from their interviews can be stored under their contact record.

If you only want the recruiting managers viewing specific candidate’s details you can also find CRMs that restrict access to specific contacts.

Some CRMs even have areas in the platform that can be used for project management and this is great for all recruitment drives. And when you find a successful candidate, you can easily create tasks to follow for when they arrive, giving everyone a perfect start to your business.

CRM for relationships

The true purpose of a CRM is to build strong, loyal customer relationships. It does this by helping you understand them on many levels by pulling in all the data you need into one place and organizing it in a way that helps you gain valuable insight. When you know your customer preferences, special dates, key milestones you can create very personalized communications and interactions for them and easily show you care.

Your CRM organizes you too. It reminds you to get in touch and tells you what type of activity is working when you do. This all has a positive impact on your relationship with your customers. It helps you look after them.

CRM for business growth

Introducing a CRM platform is proven to produce real results – especially to the bottom line. CRM systems increase your lead conversion rates, productivity, customer satisfaction and over all sales revenue. As soon as you begin to track and report on your sales activity, you’ll see a huge boost to your overall revenue.

How long have CRMs been here?

The first CRM was a simple Rolodex about 40 years ago.


It was in the ‘90s when innovators (like Brock Control Systems) began to explore the possibilities of new automated database systems.

By 1995, the CRM industry finally had a name and it helped organizations maintain lists of customer contacts that were beyond the ability of us humans to manage.

In 1999, Salesforce disrupted the industry with the cloud based, software as a service model and soon there was a boom!

Capsule was launched and CRM was suddenly a must-have for every business.

Twenty years on, technology has transformed the way we collect and understand data. CRM’s are the hub of the business. A place to go for all your customer data, to schedule your workday, standardize workflows, onboard clients and even manage your projects.

The future of CRM

More data automation is a key trend in CRM, people want to reduce data entry to a bare minimum so the more CRMs can help with that, the better.

When you have all this data coming into your CRM the next focus is gaining insight quickly. So future CRMs need to help people turn this data into actionable insights.

Larger enterprise companies with an extraordinary amount of data are experimenting with Artificial Intelligence (AI) in their CRMs. AI can analyze the data and make smart recommendations such as how and when to make contact with a customer or prospect and aid decision making.

But wherever the future takes us, at the heart of every CRM is the customer. A CRM will store everything you need to know in one central place so you have all the information you need to make them feel valued and supported. And happy customers equal a happy bottom line.

Now I want a CRM, where do I start?

Before you jump right in it’s worth stopping and thinking about what you truly need from a CRM and the value it will bring to your business.

You must be clear on your objectives before you go searching for the perfect solution. There are a huge amount of CRM solutions to choose from so if you do the thinking first, it makes the search and comparisons a little easier. Here’s some guidance on choosing the best CRM.

Once you’ve found the perfect CRM for your business, plan the implementation well. Introducing a new system can be disruptive so here’s a guide for a successful rollout.

Good luck with your CRM journey, and remember our friendly support team are here if you’d like to chat about Capsule.

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