Customer relationship management (CRM) software is a sales tool that organizes data, optimizes workflows, and manages your pipeline of leads and prospects. To help you choose, implement, and use the right one, this article provides a high-level overview of the entire topic, directing you to in-depth articles on the major concepts of CRM software. Use this article as your guide to becoming a CRM power user for you and your team
Rather than taking the full reader journey through the entire topic, you can jump to our complete list of niche-specific articles for any CRM software need: See them below. Otherwise, continue reading for an A-Z overview, beginning with how CRM software works:
How Does CRM Software Work?
With CRM software, you can manage contact data, set up sales pipelines for lead nurturing, and coordinate lead generation campaigns. The data your CRM collects allows you to generate detailed reports and build dashboards that continuously track your sales progress. You can also automate processes like data entry, client outreach, and sales forecasting – which gives you and your staff more time to focus on generating revenue and building meaningful relationships.
Analytical CRM: Turns data into actionable insights via advanced forecasting and AI. It’s beneficial for large businesses that need thorough data for planning and performance management, or any company wanting to better understand customer trends.
Operational CRM: Streamlines front- and back-office duties by automating menial tasks like data entry and scheduling. It’s best for sales, marketing, service, and admin teams wanting to optimize their workflows in order to focus on revenue-generating activities.
Collaborative CRM: Facilitates communication and collaboration by collecting, organizing, and sharing data. It’s ideal for environments where multiple departments often interact with the same customers and rely on the same data to make decisions.
Marketing CRM: Generates and nurtures online leads through advanced marketing tools for social media, email, and landing pages. It’s recommended for sales and marketing teams that want to level up their inbound efforts with effective messaging.
To select the right type of CRM software, think about your business’s current pain points and overall goals. For example, if eliminating cross-department silio-ing is something your company could be doing better, a collaborative CRM would be a logical choice, whereas a marketing CRM would be suitable if you want to enhance your inbound and lead generation strategies.
Of course, there is the possibility that your business could benefit from the qualities of more than one type of CRM. In that instance, opt for a CRM with a mix of core features that adequately address your company’s most essential needs. We’ll go into further detail about choosing the right CRM software for your business later in this article.
Best CRM Software & Average Costs
The CRM software market is flush with options, but the best ones include a robust set of core features to help businesses effectively organize contact data, map sales processes, and automate tasks. (We’ll further explore CRM features later in this article.) The best CRMs are also reasonably priced and generally easy to implement and use. Most CRMs offer a range of prices based on features and are either free or cost about $50 per user, per month.
With average costs and core features in mind, check out the five best CRM software options:
HubSpot CRM: Best for businesses seeking a feature-rich free CRM that’s scalable with paid premium upgrades (free starting price)
Pipedrive: Best for teams that prefer to manage and oversee their sales process using customizable visual pipelines ($12.50 starting price)
Freshsales: Best for companies wanting to harness artificial intelligence to forecast sales and identify viable leads (free starting price)
Salesforce Essentials: Best for small businesses looking for advanced features at a fraction of the cost of the original Salesforce CRM ($25 starting price)
Zoho CRM: Best for companies that rely heavily on social media to generate and nurture leads (free starting price)
All five of these CRMs include a free trial and/or a free-for-life platform. Most CRM software offers a way for users to try their software for free – whether it’s a demo, a trial, or a stripped-down version of the core platform.
Small-to-medium businesses can find free or low-cost CRMs with basic core functions with the option to pay for premium upgrades as they scale. Meanwhile, enterprise-level CRMs are feature-loaded and often require businesses to request a quote first. Also, some industry-specific CRM software, such as those for real estate and finance, tend to cost more due to niche features and advanced data encryption that may be required for compliance.
Check out our editorially independent review of the best CRMs for salespeople and sales teams for a full list and deeper explanation of our top CRM choices, including notable features, price ranges, and who each is right for.
Benefits of CRM Software
Aside from giving businesses a way to store essential data and streamline tasks, CRM software comes with a plethora of additional benefits that’ll allow sales, marketing, and customer service teams cultivate and maintain meaningful client relationships. CRMs also aid business owners and other leadership personnel in making informed decisions that’ll improve their bottom line.
Implementing CRM software can improve your business in the following ways:
Meet Customers’ Exact Needs: Tracking CRM metrics, client interactions, and other pertinent data gives sales, marketing, and customer success teams a chance to gauge what resonates with clients in order to provide a more personalized user experience.
Generate Viable Leads: Tools such as lead scoring, social media integration, and chat widgets help sales and marketing professionals attract and nurture leads who are most likely to convert into full-fledged customers.
Create Efficient Processes: From task automation to third-party app integrations, managers and reps alike are able to optimize their workflow so they can spend more time on activities that actively promote the growth of the business.
Improve Data Organization and Segmentation: A CRM’s centralized database allows sales and marketing reps to sort contact information so that it’s more accessible – which makes it easier to develop segments for targeted campaigns and correspondence.
Closely Monitor Team and Individual Progress: Sales managers can use CRM metrics to track team-wide and individual milestones, giving them an opportunity to offer more meaningful one-on-one feedback and re-route assignments accordingly.
Develop More Accurate Forecasts: Business owners and team leaders can use internal and external data plus advanced tools (such as AI) to accurately forecast revenue and quotas.
Note that the above is not an exhaustive list of the top CRM benefits. As we mentioned, in selecting the best type of CRM software for your business it’s important to look at your company’s specific pain points. The right CRM will be able to accommodate the unique needs of your staff and your customers.
Top CRM Software Features
CRM software features are among the most crucial criteria to consider in evaluating your CRM choices because you’ll want something that provides you and your employees with the resources they need to succeed. When evaluating CRM options for your team or business, take a close look at the various tools and functions each software offers to see how they’ll contribute to your company’s goals and overall mission.
The top CRM software features fall into these three categories:
Core CRM Features: Standard functions that all CRMs should have; some of these include contact management, lead management, CRM reporting, and customization.
Advanced CRM Features: Made for handling vast amounts of client and sales data; these features include lead scoring, sales forecasting, and AI automation.
Marketing CRM Features: Geared toward marketers who need to generate and nurture leads; some of these features include email marketing and social media integration.
Industry-Specific CRM Features: Most industry-specific CRM options come flush with industry-relevant sales and marketing tools not found in general options.
Note that advanced CRM features and/or industry-specific features tend to cost a premium and are typically most useful for large and enterprise companies with sizable client bases that regularly handle large volumes of data. Core CRM features, as well as marketing CRM features, should suit businesses of any size.
For a complete breakdown of the top features across the four categories above, check out our article on CRM features. There, you'll find a detailed list of all the CRM features you should consider using in your own software.
How to Choose the Right CRM for You
The CRM software you choose will heavily influence the success of your CRM implementation. While it may be tempting to select the cheapest or most feature-laden option, choosing the right CRM for your team or company requires plenty of careful planning. Otherwise, you run the risk of dumping money into a tool that your team leads and reps can’t effectively use.
Here are six steps you can take to select the right CRM software for your business:
Define Your Goals and Needs: Evaluate your SMART goals to see what your company could be doing better, then see which CRM tools and functions your staff will need to successfully make those improvements.
Think About Who Will Use the CRM: Who will be relying on CRM software most in their day-to-day operations? Talk to those individuals and gather some feedback from them for a clearer idea of which CRM features to seek.
Make a List of Must-Have CRM Features: Armed with the information you’ve gathered from the previous two steps, you’re now able to create a list of core and industry-specific CRM features you’ll want your ideal CRM software to have.
Draw up a Budget: Your budget should cover the total number of allotted seats, range of features, and potential upgrades in the future. There may be other expenses to build into your budget related to training, hiring, app integrations, and/or data migration.
Select Your Top Five CRM Choices: Start with a broad search for CRM software options that match your desired features and budget, then whittle it down to the top five choices that tick the most boxes for your business.
Try the CRM Before You Buy It: Hands-on experience with CRM software will help you make a well-informed decision. Fortunately, most CRMs include a way to try their software at no cost with no commitment necessary if it doesn’t work out.
Expect the process of choosing a CRM to take several weeks, as you’ll want to ensure the software you choose is the best fit for your business. Helpful for choosing is to check out our top CRM statistics, including how salespeople and businesses use CRM software. Once you have a software vendor locked in, it’s time to implement the CRM across your team or company.
How to Implement Your CRM for Maximum Effectiveness
CRM implementation is the process of installing a CRM software for a team or business. Developing a solid CRM implementation strategy will yield high user adoption rates, more efficient employees, and an increase in revenue. For maximum effectiveness, follow this nine-point CRM implementation process:
Choose the Right CRM: Select a CRM that fits your budget and best addresses your company’s needs; see the previous section for an in-depth look at this step.
Coordinate a CRM Implementation Team: Assemble a core group that will encourage employees to buy into the software, monitor post-implementation success, and ultimately become the CRM’s power users on whom others can rely for assistance.
Create a CRM Implementation Plan: Outline the steps your business needs to take for successful CRM implementation – incorporating your objectives, budget, key players (implementation team), and projected timeline.
Customize the CRM: Configure the software to meet your company’s unique needs – for instance, set up user permissions, create automated workflows, and customize the layout of the CRM.
Migrate Your Data to the CRM: Transfer data to the new software, then ensure everything has been properly imported from the previous source (whether that’s a spreadsheet or another CRM).
Integrate the CRM With Third-Party Tools: Expand the functionality of your CRM by adding commonly-used apps to further optimize workflow via native integrations, third-party connectors, and/or API integration.
Test the CRM: Once you’ve imported your data and configured the CRM to your specifications, it’s time to put the software through its paces in a controlled environment to detect any bugs that may need to be ironed out before the official launch.
Roll Out the CRM and Train Your Team: Once the CRM is live, take the proper measures to acclimate the intended end users by having your CRM implementation team host training sessions.
Monitor Post-Implementation Progress: Secure high adoption rates by continuing to promote the benefits of the CRM software through offering regular training sessions and encouraging users to give feedback.
This nine-point plan will require a significant investment of resources, money, and time. However, it’s your company’s best chance to secure a CRM that will be well-received and effectively utilized – which in turn will increase growth, sales, and productivity.
Take a look at our guide to CRM implementation for a detailed explanation of every step in the nine-point process we’ve outlined above. This should help you successfully implement your CRM software so it's widely adopted and used.
Frequently Asked Questions (FAQ)
Is CRM Software Hard to Learn?
That depends on the complexity of the CRM software itself plus the innate technical knowledge of the user. Some CRMs tend to have steeper learning curves than others – particularly if they have a lot of customizable elements and advanced features. However, access to proper training plus a well-built library of self-serve reference materials will translate to a successful effort in acclimating your intended end users, regardless of if they're tech savvy.
Which Industries Can Benefit Most From a CRM?
Customer-centric industries like retail and hospitality should consider adopting a CRM in order to strengthen existing client relationships and usher in new patrons. Meanwhile, those in the financial services or healthcare industries should think about implementing a CRM to keep sensitive user information secure and orderly.
Industry-specific CRMs will give those businesses a competitive edge in their respective industries, but any organization seeking a way to streamline workflow and organize data will benefit from using CRM software.
What Are the Drawbacks of CRM Software?
Possible drawbacks of CRM software include increased operating fees, poor user adoption rates, and occasional technical issues. However, such issues can be largely mitigated by executing a solid CRM implementation strategy and choosing a software vendor with quality user support plus a robust knowledge base.
Is CRM Software Worth It for Small Businesses?
Although small businesses may be able to use spreadsheets and calendars when they’re first starting out, they’ll eventually outgrow those tools. The sooner a small business adopts a CRM software solution, the easier it will be to scale as their client base grows and profit margins expand. Fortunately, there are several excellent free CRM software options cost-conscious small business owners can use until they’re ready to upgrade to something more substantial.
Bottom Line: CRM Software
Whether you’re a small business or a large enterprise, CRM software is a dynamic sales software tool that can go a long way in helping your staff become more organized and efficient – provided you have a firm grasp of what your company needs to succeed. Selecting the right CRM software and executing an effective implementation strategy will yield an increase in productivity, growth, and revenue for your business.
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