Definition
CRM stands for Customer Relationship Management. It refers to the systems, processes, and strategies that businesses use to manage interactions with customers and potential customers. CRM software centralises customer data such as contact details, purchase history, and communication records, enabling businesses to build stronger relationships, streamline workflows, and improve customer satisfaction.
For example, a sales team may use a CRM platform to track leads, manage opportunities, and monitor customer touchpoints across the sales cycle.
Advanced
CRM systems go beyond storing customer information. They integrate with sales, marketing, and service platforms to automate processes such as lead nurturing, customer support, and personalised marketing campaigns. Advanced CRMs often include features such as predictive analytics, AI-driven insights, customer segmentation, and multi-channel communication tracking.
Enterprises may adopt cloud-based CRMs like Salesforce, HubSpot, or Microsoft Dynamics to ensure scalability and accessibility. Integration with ERP systems, e-commerce platforms, and social media further enhances visibility into customer journeys. Data security, compliance with privacy laws, and customisation for industry-specific needs are also central to advanced CRM strategies.
Why it matters
- Centralises customer data for better decision-making.
- Improves sales efficiency by tracking leads and opportunities.
- Enhances customer experience with personalised communication.
- Supports long-term loyalty and retention strategies.
Use cases
- Managing customer support tickets and case resolution.
- Automating email campaigns tailored to customer segments.
- Tracking sales pipelines to forecast revenue.
- Analysing customer behaviour for cross-sell and upsell opportunities.
Metrics
- Customer acquisition cost (CAC) and lifetime value (CLV).
- Sales pipeline conversion rates.
- Customer retention and churn rates.
- Average response and resolution times for support cases.
Issues
- High implementation and training costs for complex systems.
- Data silos if CRMs are not properly integrated with other tools.
- User resistance to adopting new processes.
- Compliance risks if customer data is not handled securely.
Example
A retail company adopts a CRM system to unify online and in-store customer data. By integrating purchase history with targeted email campaigns, the company boosts repeat purchases and improves loyalty program participation.