What does a CRM do?

So you’ve heard all about CRMs and how they can help your business.

But what is a CRM and what can it do?

Well, let’s review it all. Today, we’ll break down the basics and advantages of CRMs.

What is a CRM?

Let’s start with the very basics. The letters CRM stand for Customer Relationship Management.

But when talking about a CRM, most people are referring to a CRM software platform.

In essence, CRMs seek to collect, store, organize, analyze and centralize all of your customer data. This includes contact information, purchase history, email history, chat history and more.

Want to learn more about CRMs? Read our guide about what CRMs are and how they work.

Types of CRMs

As you might expect, CRMs come in many different shapes and forms.

Generally, CRMs are divided into 3 main types.

Operational CRMs: Seek to improve the operations of your customer data tasks. Including the collection, storage and organizations of your customer data.

Analytical CRMs: Seek to identify insights and trends based on your customer data that can educate future strategies for your business.

Collaborative CRMs: Seek to centralize your customer data across your organizations. This allows all departments to work with up-to-date data and prevents data duplication and errors.

Despite the existence of these categories, most modern CRMs have features that fit the descriptions of more than one type of CRM.

After all, a great CRM tool will be able to become the main hub for all of your customer data, not matter the use.

Want to learn more about the types of CRM? Read our guide on the 3 types of CRM and how they differ from each other.

What does a CRM do?

Now let’s get into the nitty-gritty of things. What can a CRM actually do?

Let’s review some of their most important features.

Automates Customer Data Collection

CRMs help you automate the collection of customer data. CRMs can collect your customers’ contact information automatically once they contact your business, instead of leaving this information in a messy email inbox.

Data can also be collected from live chats, calls, web sessions, purchases, marketing email opens, etc. This saves your company a lot of time by reducing your customer data input times.

Centralization of Data

After this data is collected, CRMs store it and organize it in centralized profiles for each customer. This way, all the data related to any customer resides in one single place. From their contact information to their purchase history.

This allows any employee across your company to access the same file for each customer. This allows every employee to have access to the most up-to-date information and prevents data duplication and errors.

Increases your Customer Revenue

The ultimate goal of any CRM platform is to optimize your customer-focused operations and data.

And as a result, increasing your customer revenue and decreasing the cost of your customer-focused operations.

More Advantages of CRMs

The three scenarios above are just the tip of the iceberg.

CRM platforms offer numerous benefits for all kinds of companies.

From the ones we’ve mentioned to marketing automations, insights and more. Check out our guide on the 7 best advantages of CRM solutions.

Do you need a CRM?

At this point, you might not only see all the benefits of CRM platforms, and you also might be wondering if you need one.

The truth is that it depends. After all, each business has different needs and goals.However, we’ve put together a guide on 7 sings that might say that your business needs a CRM.