At one time, businesses kept all of their information on paper. Contacts were stored in Rolodexes and bookkeeping was traced using paper-based ledgers. Most professionals carried around a paper-based daily planner where they kept up with customers and tracked their activities. Technology changed all of that. Today’s workers expect to be able to do everything using software, including tracking activities, storing customer information and managing their marketing campaigns. For all of this, many businesses now use customer relationship management software.


CRM, or customer relationship management, is a software platform that helps a business manage all of its customer relationships.

What Is a CRM Database?

Interactions with customers are at the heart of any successful business. You need a way to track and store customer data so you can later use that information to strengthen your relationships. A CRM database is a handy way to do this, making it easy to input contact information and extract it in usable ways. At one time, this might have simply been used to create mailing labels for your postal marketing campaigns, but today, CRMs are relied on for so much more.

By inputting customer contact data and having your employees note their daily activities, you can use built-in analytics in your CRM to gather information on your business. Over time, you may find that you’re adjusting and refining your activities to match the data from your CRM. First, it’s important to know the many ways you can use it.

The History of CRM

CRM software started in the 1980s, when ACT! launched a platform it called "contact management software." This technology was designed to serve as a digital Rolodex, where the names, addresses and phone numbers stored on an employee’s desk could be moved to his computer. This approach served as the very foundation for the customer relationship management software seen today. Throughout the remainder of the '80s, companies released similar contact information software, including Goldmine and a few other vendors that are still around today.

When you consider the CRM meaning, though, you likely think of the software that began hitting the market in the '90s. Companies like Brock Control Systems introduced the world to what we now know as sales force automation. These solutions automated the process of database marketing and combined them with the contact management software already on the market. When Tom Siebel left Oracle to form Siebel Systems, the field quickly advanced, becoming closer to the solutions we know today by the mid-'90s. Soon Siebel Systems was met with competition due to offerings from Oracle and Baan.

CRM for Sales Teams

When CRM is mentioned, people automatically think of sales teams. Salesforce has become a household name due to its widespread use in businesses across all industries. Although CRM has many other purposes, sales teams are especially prone to rely on it, mostly because they need a way to track customer interactions. CRM goes well beyond simply collecting contact information on the people team members encounter as they network. It also helps you identify the best leads for the goals you’re trying to achieve, and it helps you create and track a pipeline.

For sales teams, CRM solutions are perfect for ensuring everyone works well together. One team member can see if another has reached out to a prospect so they don’t duplicate efforts. If someone has noted that a potential customer isn’t interested, other team members know not to follow up. Newer features even allow sales teams to set up alerts to remind them to get back in touch with a prospect or customer after a certain amount of time has passed, preventing things from falling through the cracks.

CRM and Customer Service

People also associate the CRM meaning with the tools used by customer service teams. Whether your business has a call center or just a few people interacting with customers, a CRM can help keep up with it all. If a customer calls about an issue, team members can log it and see it later. They can also route the issue to other team members using tickets.

One of the best things about CRMs for customer service teams is that they can be set up to share the information with other teams in the same organization. Sales teams will be able to tell if customers have called in, and they can follow up. Marketing teams can also push incentives through their customer service teams, asking them to upsell customers as they call in to resolve an issue they’re having, for instance.

CRM for Marketing Teams

From the start, the concept of a CRM database applied perfectly to marketing team activities. Marketing teams needed a way to pull extensive contact lists to ensure their messages reached the right people. Over time, these databases have evolved so that marketing teams can not only send marketing messages but can also track the success of them. Marketers can see how many of their emails were opened, how many recipients took action, such as clicking on links or responding to offers, and what time of day their messages are most likely to be opened rather than ignored.

Today’s CRM software is also used to allow marketing teams to set up drip campaigns, which means that a later email is sent based on the response to previous ones. A prospect who didn’t open a first email might get a different follow-up email than a prospect who clicked on the link in that first message. Over time, teams can use what they learn from their analytics to create more effective marketing campaigns.

Implementing CRM for Your Business

As valuable as customer relationship management can be to an organization, putting it in place can be complicated, especially in workplaces where employees have done things a certain way for years. For a while, the cost of CRM software and implementation put it out of reach for smaller businesses, but cloud technology has made it easy even for the smallest startup to jump on board for a low monthly per-user rate.

Even with cloud-based solutions, you’ll need to ensure your employees are trained on how to get the most out of your new software. It can help to fully introduce everyone to the basic CRM meaning by describing everything it will be able to do for your organization. The vendor you choose may have training options, so make sure you check into that. If you decide to provide training in house, make sure you record it or create manuals so that future employees can get on board without you having to repeat the training.

The Future of CRM

The best thing about CRM is that it’s only getting better. CRM database technology is already improving, thanks to machine learning. This means that eventually software you use every day could predict outcomes, telling you exactly what efforts you need to take to increase sales 10 percent, 20 percent or 30 percent.

To prepare your business for this future technology, though, you’ll need to make sure your database is stocked with as much information as possible. You won’t be able to replicate historic data once you get the newer version of your CRM, so having that information input now will help you down the line. Make sure that at the very least you’re collecting contact information for every customer and promising lead, even if they turn you down today. You may find that once you have more sophisticated software, you can reach out in a way that will turn a no into a yes.