Customer relationship management, or CRM, involves multiple functions. It deals with the many interactions between a company, its sales forces, its marketing team and its customers. CRM software supports these interactions primarily by serving as a data management system. Although its functions can vary widely with software vendors, most CRM software has a core set of functions starting with the tracking of leads and ending with monitoring the service rendered to customers.

Lead Capture

CRM software captures information about potential customers, or "leads". Sales representatives can type lead information into the system manually, or, when the software is combined with a web site, visitors are invited to submit information on forms that the CRM software captures automatically.

Prospect Tracking

CRM software can track the behavior of leads who are displaying interest in becoming customers, or "prospects," by recording click-through and conversion of affiliate marketing ads, links in emails, website forms and even human-to-human contact such as on-site visits and phone calls. It will capture this information automatically, except for the human-to-human contact, which sales representatives must enter.

Customer Tracking

Once a prospect purchases from the company, he or she becomes a customer worth tracking. CRM software will track information about customers such as products purchased, dates of purchase, sales representatives involved, purchase prices, special instructions and customer feedback.

Marketing Reporting

The data in a CRM software system is useful when aggregated and displayed in reports that answer specific marketing questions. For example, marketing personnel will want to see which ads received the most click-through and conversion rates, which affiliate sites attract the most clicks from prospects, customer demographics and which products are selling and at what prices.

Service Tracking

A CRM system may include information that helps representatives with customer service. For example, the system will give the representative access to customer purchase and service contract data, product information and a knowledge base while also allowing the representative to record service-related information such as complaints and support tracking numbers.