What is a CRM System
Sean Salas
By: seansalas
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What is a Customer Relationship Management (CRM) System?

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Keeping track of your customers is vital to the success of your small business. A Customer Relationship Management (CRM) system is a database that tracks a business’ interaction with its customers. The type of CRM system can vary from a simple excel data sheet tracking your customer interactions to a fully-integrated online system providing real-time information on customer data, marketing campaigns, and performance. In this article, we will evaluate the advantages of having a CRM system. We will also expose and the different types of CRM systems, so you can find the one that best suits the needs of your business.

Advantages of a CRM System

If you operate a customer oriented business with more than a handful of clients, then your business needs to have a CRM system. By not having a CRM system, your business is not going to fail. However, your business will be at risk of not maximizing the earnings potential of its customers. Moreover, your business could be at a competitive disadvantage, given competitors with CRM systems will know their customers better.

These are the two key benefits of having a CRM system:

  • Customer Interaction Tracking: A CRM system evaluates how your business is interacting with its customers. If interaction with your customers is 100% transactional (at the office or retail store), then you have a problem. Find new, innovative ways to interact with your customers through social media, newsletters, website, Yelp, and events. Your customer will love you more for it. More love, more money.
  • Customer Performance Tracking: Tracking a customer’s performance allows you to maximize your earnings potential. Key data points that you should track include: frequency of customer purchases (daily, annually), revenue and profit per customer, and new and lost customers.

What CRM System is Right for You?

The rule of thumb here is: start simple and then build-in complexity. At Camino Financial, our first CRM system started with an excel sheet. By starting simple, we figured out what were the customer data points we wanted to capture. In addition, starting simple helped us establish administrative procedures to track our customer information. Establishing processes to update a CRM system is as important as the CRM system. You may also want to consider using existing financial tools, such as QuickBooks, as a way to begin tracking customer performance.

But existing financial tools or an excel sheet will take you only so far. A more sophisticated CRM system will give you more capabilities such as customer forecasting, mobile data entry and tracking, social media integration, and marketing campaign optimization. Depending on your CRM budget and type of business, there are many different CRM systems that may suit your business needs. In this supplemental article, you will find 9 CRM products that have two things in common: they all are affordable and simple to use. We encourage you to find there the CRM option that best suits your small business. The CRM of your choice will make a difference in the way you interact with your customers, thus having a great impact on your business.

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