To the question: what does the acronym CRM stand for? Acronym Finder will answer you that these 3 letters CRM do not have 30 verified meanings, like the acronym ORM mentioned in this post, but this time more than 127 possible definitions! Which is quite a lot.

For this new post I will focus on the most common and popular meaning at the end of 2021: CRM for Customer Relationship Management. Now, from a software point of view, there are a lot of software names and editors available in that huge technology market. As a change from the usual, this time I’ll start with the top ten best CRM solutions from PC Magazine for 2021, first the practical side and then the theoretical side:

There is no doubt that SalesForce is the most popular and complete CRM software out there, as detailed in this article. As a $13 billion company, it can not be ignored if you are considering CRM software. We know the names of ten competitors now, but what is a Customer Relationship Management exactly?

Customer relationship management is a process in which a business or other organization administers its interactions with customers, typically using data analysis to study large amounts of information.
Wikipedia

The encyclopedia provides a really complete definition and description here, in a total of 11 sections, starting from the “history” of CRM, then the five “types” of CRM: strategic, operational, analytical, collaborative and the customer data platform (CDP) type. We learn in the “components” point that it’s a management process, similar to Outsourcing Relationship Management, but built through marketing, observing the relationships as they mature and managing them according to their stage of maturity.

There is an headache and tired stressed asian young employee businessman working finance about cost with clipboard document report and coffee cup on desk at home office, illustrating customer relationship management software

The section called “In Practice” describes five application cases of a CRM, but for me, these are the most interesting:

  • The section about CRM “effect on customer satisfaction“, where CRM systems are indicated to increase customer loyalty & customer knowledge, followed by a reduction of customer complaints and defections. In addition to that, the sales force & customer service are more effective and efficient. The studies that support them say that these tools can fix all problems a company may face with its customers.
  • The section called “Criticism” about CRM, balancing the preceding enthusiasm, by discussing the importance of customer privacy laws, then about a CRM paradox, or the dark side of CRM, with possible favoritism toward some customers based on their profitability. This part of the article tells us that translating CRM data for CRM analysis can be a difficult and critical job for companies using CRM, who are usually disappointed with their inability to meet their expectations in terms of relationship management, and do not pay attention to the proper way to translate their CRM data into a feasible action plan.

Many companies receive vast amounts of data via e-mails, online chat sessions between customers and reps, and phone calls that contain relational signals, but they’re poor at collecting and analyzing all this information.
Harvard Business Review, july 2014

To conclude this post, let’s look at the cases in which a CRM is needed and when it isn’t needed. Being aware of what a management process is won’t allow you to understand when, for instance, you ought to use it. In February 2021, the team from Really Simple Systems Ltd, a UK-based company with almost 18,000 customers and a commerciliazed CRM solution since 2006, published a comprehensive and intuitive guide about how and when a business might benefit from a Customer Relationship Management software:

  1. More prospects are in front of you than you can recall
  2. Your prospects have more than one point of contact
  3. As a B2B business, you deal with contacts (individuals who belong to accounts)
  4. You want to review or run sales forecasts on instinct.
  5. Your salespeople prospects should be under your control
  6. You won’t be able to remember where each prospect is in the sales pipeline
  7. Sending out simple newsletters or using more sophisticated & segmented campaigns is how you use email marketing

In the same vein, the authors conclude by advising us of four reasons why a CRM system is not necessary:

  • If you’re a one-person operation and you do not have to manage sales staff
  • There are only a few leads you get every week
  • You only have a few key customers.
  • Sales cycles are short and repeat business is nonexistent.

Corporate Customer Definitions Management Relationship Software