CRM

What is CRM?

What is CRM?

Customer Relationship Management Helps You:

  • check_circle_outline Deliver a great customer experience
  • check_circle_outline Get a handle on customer data
  • check_circle_outline Go after the best opportunities
  • check_circle_outline Cut down on manual work
  • check_circle_outline Boost your bottom line

Deliver a great customer experience

Experience. Everyone’s talking about it, from Gartner, which has a customer experience summit, to industry reports.

The third stage of HubSpot’s flywheel — Delight — underscores the importance of customer experience (CX). It’s not enough to sell people something or even to meet their needs and desires with your product or service.

Today’s consumers want enjoyable, memorable, positive experiences when interacting with your brand.

They want to be delighted.

And not just once. CX applies across all touchpoints, from interactions on social media to online purchases using a mobile phone to customer service issues. What will providing a first-class experience do for your company? Consider this finding from a 2018 Salesforce survey: 70% of customers are willing to pay more for a positive experience.

Not only that, Salesforce research has also shown that expectations are going up across the board. Nearly 75% of customers say that a great experience with one company raises their expectations of other companies.

Using CRM software puts your business in a position to meet those expectations.

How?

The CRM’s central database gives sales, marketing and service access to the same info, enabling your company to provide the consistent interactions customers think they should receive.

Access to customer data also helps you cross-sell items a customer’s likely interested in, thereby providing convenience. You can set rules in the system so that when someone buys a new iPhone, for example, they’ll receive an email about purchasing a phone case and protective screen as well.

With CRM, you also gain tools that allow you to personalize your interactions beyond emails with the contact’s first name. Social media integration provides insight into how your customers interact with your brand on different channels so you can respond accordingly. And you can use list segmentation for precise targeting, so you put the right content in front of the right people.

Get a handle on customer Data

Spreadsheet tabs multiplying? Mountains of scribbled notes threatening to bust down the doors? Scads of data bouncing around without a purpose?

If any of those sound familiar, customer relationship management can provide tremendous value. These solutions use a central database for storing data-rich profiles. Everything from contact info to likelihood to buy is viewable from a single screen.

The information updates as the contact progresses through your funnel, giving a real-time view. Some solutions also pull in data from social media sites, such as the person’s connections or how they’ve interacted with your brand online.

Go after the best opportunities

Knowing the health of your pipeline and which leads you should spend time pursuing is critical.

With strong customer relationship management, you get insight into those areas and more. That way your team doesn’t waste time chasing after the wrong leads and you always know where opportunities stand.

Many systems include a broad toolset that help direct your efforts:

  • Lead Scoring: Identify which prospects are hot — and which aren’t.
  • Data Intelligence Capabilities: Model a contact’s revenue potential, reveal which regions are the most profitable and more.
  • Segmentation: Group leads based on qualifying criteria, such as the products they’re interested in or what demographic they fall into.
  • Visual Pipelines: View what stage every lead is at and easily transition them through the funnel.

Cut down on manual work

Automation is one of the most helpful features CRM offers.

Tackling customer relationship management activities without a dedicated solution is a lot of work. Manually entering each new contact’s info. Scribbling notes to keep track of details. Setting reminders to send that follow-up email.

That workload isn’t scalable. Even if you have a team to help, doing things by hand isn’t efficient.

CRM solves that problem. They can update data when a change happens in the system, automatically pull data to display in charts and graphs, assign leads to different sales reps, and a host of other things.

Thanks to marketing automation features, you can build email sequences and define when to send each email, based on actions taken by the lead or customer.

  • Send a “thank you” email after a purchase
  • Trigger an email nurture campaign after a lead fills out a form
  • Deliver a monthly newsletter to subscribers of your members program

Boost your bottom line

At the end of the day, effective customer relationship management increases your revenue.

Besides pointing sales reps toward the best deals, it can notify your sales team when a lead needs attention lest they become a victim of the dreaded black hole known as “churn.”

Robust CRM software also comes with a host of analytics tools. Dashboards, charts, graphs and reports visualize a variety of metrics — giving you a comprehensive look under the hood of your business:

  • Email campaign performance (number of opens, click-through rate, etc.)
  • Deals closed per sales rep
  • Sales by region, vertical, product, etc.
  • Leads most likely to churn
  • Overall lead conversion rate
  • Average deal size
  • Forecast revenue

That list is only the beginning of what you can drill into. Such deep insights help you make smarter decisions and optimize for the most profitable outcome.

You don’t have to fire shots in the dark and hope you hit your target. CRM shines a light on where your business does well so you can direct your efforts toward doing more of what works.

FAQs: The Scoop on CRM

What Does CRM Stand For?

People throw the term “CRM” around a lot. But what does it mean?

Usually, they’re talking about the digital platforms used to store data, send email campaigns and the like. That’s what we’ll focus on in this article. However, the answer to the question “What’s a CRM?” actually has a close relative because CRM refers to both a concept and the technology used.

So before you can research What a CRM system is, you first have to ask what is customer relationship management.

CRM refers to customer relationship management, which describes the process used to manage every aspect of a company’s communication with prospects, leads and customers. It helps businesses generate and nurture leads, close more deals and retain customers with the ultimate goal of increasing customer lifetime value (CLV) and driving revenue.

What Is CRM Software?

Customer relationship management software, on the other hand, is the technology that helps your company execute customer relationship management. It’s often shortened to CRM, making it interchangeable with the concept of customer relationship management.

To illustrate, think of managing your customer relationships as your destination and the software as a car that takes you there.

Though CRM systems on the market have a wide range in terms of capability, they revolve around the central mission of helping businesses interact with consumers.

CRMs are typically grouped into three main types: operational, analytical and collaborative.

Operational: Helps streamline a company’s sales, marketing and service activities. This is where you’ll find applications for sales force automation (SFA), marketing automation and service automation.

Analytical: Lets you probe your data using methods like data warehousing and data mining. Equipped with robust analytical features, these systems help put your data to work by pinpointing trends, extracting insights, and painting a more accurate picture of who your customers are and what they want.

Collaborative: Breaks down silos across teams so they can collaborate more effectively. For example, when marketing passes a qualified lead off to sales, the sales rep can view the lead’s profile so they’re not walking into their interactions blind.

The thing to remember is that many customer relationship management systems offer a diverse set of features. True CRMs — aka not standalone SFA or marketing automation — combine elements of each type described above. This makes them one of the most powerful tools at your disposal.

Why Should I Care About CRM?

CRM is big, and it’s only expected to grow in importance and size. It surpassed database management systems in 2017 as the largest software market, with global revenue just shy of $40 billion.

And earlier this year, Gartner called it “one of the fastest-growing business software application markets,” with growth forecasted at 13.5% CAGR through 2022.

But there are reasons customer relationship management matters apart from the impressive stats and expert opinions.

Back to the car analogy, customer relationship management is essential in reaching your destination faster and more efficiently — yours might be increased growth, doubled sales or better customer service. No matter your goal, not having CRM is the equivalent of traveling cross-country by stagecoach when everyone around you is using a car.

Selling is hard today. People want experiences, not just products or services. They want to interact with your company on their terms, using different devices and channels. And data floods in from social media, websites and dozens of other sources.

CRMs provide you the tools you need to keep up with customer demands, put your data to work and improve your bottom line.

How Does CRM Software Work?

CRMs handle dozens of activities, with specific tools that aid each. But those all surround and support three main purposes:

  • Attract prospects and convert them to leads
  • Nurture leads until they become customers
  • Keep those customers happy and coming back for more

Let’s walk through the marketing, sales and customer service phases to see the purpose of a CRM platform in a company.

Marketing

Marketing acts as the entry point, running campaigns and conducting other activities to generate leads. Marketing automation and email capabilities, such as customer targeting and triggered emails, play a central role at this stage.

Customer relationship management also provide contact management and lead management. Contact management lets you store all a lead’s info for easy access. Lead management comes with the following capabilities to convert prospects and monitor their progress through the funnel:

  • Lead generation
  • Web forms
  • Pipeline tracking
  • Lead follow-up
  • Lead capture
  • Lead distribution

The goal of this stage is to nurture leads to the point where they’re qualified for sales to take over. Automation and a 360-degree customer view make the handoff process more streamlined and less prone to error than it used to be.

Marketing also steps back in post-purchase, since many customers are candidates for repeat buying. A CRM helps send new offers, encourage upgrades and support membership programs to increase customer retention.

Sales

Once a lead passes to the sales team, they receive all the contact’s info and history. Here, CRM solutions use opportunity management, win/loss analysis, quote management and other tools to drive more deals.

Automations take repetitive tasks off the plate of the sales team, and cloud-based CRMs have mobile apps that give reps on-the-go access.

At this point, leads will either convert to customers, drop out of the cycle altogether or revert to marketing for more nurturing. No matter what happens, the CRM tracks everything.

Service

The lead has become a customer. Mission accomplished!

Well, not quite. Customer relationship management supports the entire journey a customer has with your company. Given that retaining customers provides a far higher ROI than constantly losing them and going after new ones, giving them every reason to stick around is necessary.

This is where the service team takes the stage, to support customers so they don’t jump ship when something goes sideways. This includes responding to issues and answering questions.

You’ll find CRM systems that come with capabilities for building knowledge bases and help centers or integrating your current help desk solution. And since a customer’s profile contains all their past interactions and information, it’s easy for service agents to get the full picture so they can provide a more personalized, relevant experience.

Who Uses CRM?

You may think that only large enterprises need CRM. But CRMs are helpful even for companies with only a few employees. There are even solutions specifically for nonprofits.

Research by CSO Insights from 2018 showed that nearly every company uses customer relationship management, whether it’s a commercial product or an ad hoc version that stitches together different tools.

No matter what industry or company size you look at, customer relationship management has become a basic cornerstone of building a successful business.

As we just looked at, a CRM solution will mainly be used by sales, marketing and customer service teams.

When Should My Company Adopt CRM?

How can you know the right time to say goodbye to your spreadsheet and go mainstream? It depends on your company’s unique situation. Every business is different. That said, here are some good indicators it’s time to invest in effective customer relationship management:

  • Your spreadsheet has gone Frankenstein monster and is out of control. Keeping track of contact info is a nightmare.
  • You’re losing out on revenue and need software to produce higher quality leads and drive more sales.
  • Your business has outgrown your internal CRM concoction. It’s time to streamline work or drown in all the to-dos.
  • Your one sales rep leaves and you suddenly realize that there aren’t any processes and systems in place for keeping the pipeline full and the sales flowing in.

How Much Do CRMs Cost?

This depends entirely on the level of functionality you need. If you’re running a small operation, an open-source CRM or free version of a premium product may be adequate.

If you need more capabilities, there are a range of price options that can cost anywhere from hundreds to thousands of dollars per year. A few things to keep in mind:

  • The typical pay structure for CRMs is subscription-based, where, you pay for each user either per month or annually. If one user costs $100, then five users would cost $500. The exception is on-premise systems, like those from SAP or Oracle, which have a licensing model where you make a one-time purchase and own the right to use the software.
  • Vendors almost always have different pricing tiers that add more capabilities the higher you go. So if you want an advanced feature — say, task automation — it’ll cost more.
  • You may also pay more for extra contacts or storage.

Should I Use Cloud or On-Premise Hosting?

This used to be a raging debate. But recently, it’s become less of a central factor as cloud CRM has become the preferred choice.

Gartner expects that trend to continue. 2019 will see cloud solutions account for 75% of the total spend on CRM software.

Our own research indicates a similar move toward the cloud. In speaking with more than 500 companies looking for a CRM last year, we found that 63% were solely looking for cloud-based applications while another 35% were open to the idea.

Cloud-based CRM brings a world of benefits to a business. With your software hosted in the cloud, there’s no need to worry about maintenance, security updates and other upkeep — the vendor handles it all.

Another key advantage is the flexibility cloud solutions offer. All users need is an internet connection, letting sales reps and others use the system from their home office, the airport and anywhere else.

That’s not to say on-premise deployment is ready to accept its place six feet under. It’s still a viable choice for some organizations. When looking at options for your company, keep your requirements at the forefront when determining which deployment method makes the most sense.

However, the cloud is certainly casting an ever-growing shadow across the CRM industry.

How Do I Select CRM Software?

Choosing software can be a complicated, time-consuming process. And with customer relationship management, there are literally thousands of solutions available to pick from. We’re here to make that journey more manageable and less stressful.

Whether you’re looking for a new system or your first CRM, our free comparison report is a great place to start. It’ll give you a rundown of the top products available so you can take your search in the right direction from the get-go.

We’ve also put together a number of CRM resources for you to peruse:

Recent Articles

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Your Guides

Our industry journalists proudly distill the helpful information you read on SelectHub, always on the mission to share what matters to you can make your best decisions independently.

CRM articles are written and edited by:

Zachary Totah

Market Research Associate

As a Market Research Associate at SelectHub, Zachary Totah develops articles for HR, supply chain management, project management, CRM, construction, marketing automation and ERP.

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Bergen Adair

Market Research Associate

Bergen Adair is a Market Research Associate at SelectHub who writes content on CMMS, FM, EAM, Business Intelligence and Enterprise Reporting.

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Kim O’Shaughnessy

Lead Editor

Kim is the Lead Editor at SelectHub, where she edits and manages content for over 40 different software categories.

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Thought Leaders

SelectHub has sought out and invited thought leaders to contribute to our CRM industry articles and resources. These thought leaders ensure we deliver quality content with the most accurate information, focusing on what matters most. No thought leader is compensated for their contributions, but shares our belief that information should be democratized so everyone can make the best decision.

Ardath Albee

Ardath Albee

B2B Marketing Strategist and CEO

Ardath Albee is a B2B Marketing Strategist and CEO of her firm, Marketing Interactions, Inc., who helps companies with complex sales

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David Deans

David H. Deans

Senior Partner, David H. Deans & Associates

David H. Deans is the Senior Partner of David H. Deans & Associates. As a seasoned entrepreneur, he has worked within the multinational telecommunications

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David Dozer

David Dozer

CTO of Blaze IT LLC

David Dozer is a business consulting and IT specialist with more than 15 years of experience in the enterprise software realm.

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John Chan

John Chan

Co-Founder and CEO, Shrood

At Shrood, we’re passionate about bringing advanced business intelligence to a host of industries including Retail, Wholesale, Manufacturing and Supply Chain.

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Andy Crestodina

Andy Crestodina

Co-Founder and CMO, Orbit Media

Andy Crestodina is a co-founder and CMO of Orbit Media, an award-winning 38-person digital agency in Chicago.

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Doug Kessler

Doug Kessler

Co-Founder and Creative Director, Velocity Partners

Doug Kessler is co-founder and creative director of Velocity Partners, the London- and New York-based B2B content marketing agency (a Content Marketing Institute Agency of the Year).

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Bryan Eisenberg

Co-Founder, BuyerLegends

Bryan Eisenberg the co-founder of BuyerLegends and is the co-author of the Wall Street Journal & New York Times bestselling books “Call to Action”, “Waiting For Your Cat to Bark?”, “Always Be Testing” and “Buyer Legends:

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CRM Requirements Checklist and Evaluation Template Document

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Picking CRM software is one of the most important choices you’ll make for your business. However, it can feel like a high-stakes game of Russian Roulette. Many companies have a difficult time finding the right solution. It costs too much or doesn’t have the capabilities they need or can’t be customized to fit their processes. You can avoid all of this by starting your search the right way: identifying your CRM requirements.

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CRM Automation: What It Is, What It Does and How It Can Benefit You

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CRM software has become almost legendary at this point. You’re probably familiar with the common benefits touted — data organization, improved sales performance, higher customer retention and so on. Well, you can add several more things to that list, thanks to CRM automation.

Zachary TotahCRM Automation: What It Is, What It Does and How It Can Benefit You
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The Current State of the CPQ Market

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CPQ strategies continue to bring greater accuracy and speed to every aspect of sales cycles, from pricing to product configurations. Considered to be one of the hottest areas of Customer Relationship Management (CRM), CPQ strategies are unique in that they provide unequivocal evidence of their value across an enterprise. The more complex the sales cycles, product configurations and channel selling structures, the more CPQ selling strategies pay off. Gaining greater insights into customer requirements and being able to quickly anticipate and act on their needs is essential for winning additional deals.  CPQ is the catalyst of sales growth many companies need to excel at, as every aspect of customer relationships is becoming more complex, faster and more context-driven than ever before.

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Salesforce vs Netsuite: Which CRM Is The Winner?

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NetSuite and Salesforce are two leading customer relationship management solutions that many companies are banking on to deliver successful results to their sales and marketing goals.  Listed on PCMag’s Best CRM Software list, both systems are among the industry’s leaders.  Customer relationship management tools provide key assistance to sales and marketing teams and many others within an organization.  They help people at all staff levels to understand customer profiles, craft better interactions, and ultimately win more business.  Here are some of the reasons that people are going with these 2 CRM leaders: Salesforce vs. Netsuite.

SelectHubSalesforce vs Netsuite: Which CRM Is The Winner?
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CRM vs. Marketing Automation: A Comprehensive Comparison of the Difference Between Them

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Many people and businesses are wondering the difference between CRM vs. marketing automation. If you’ve done any research, you already know that combining CRM & marketing automation is highly recommended. But, you still may be wondering what the actual difference is since you’ll likely have to invest in 2 different solutions.

SelectHubCRM vs. Marketing Automation: A Comprehensive Comparison of the Difference Between Them
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Top CRM Features and Functionality List

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Working with customers can be a challenging task. Keeping up with contacts, correctly diagnosing problems and ensuring satisfaction as well as positive interactions can feel like the weight of the world on the shoulders of your customer relations team. Customer relationship management software (CRM) can carry a lot of that workload for business and sales processes.

Bergen AdairTop CRM Features and Functionality List
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Best CRM Software For Banks

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Banks aren’t what they used to be — the days of stuffy vaults and high counters are long behind us. Banks of the modern age need a modern way to interact with customers, and customer relationship management CRM software (customer relationship management) offers just that. But which CRM software do banks use? To answer, our analyst team has compiled this list of the top CRM for banks to help you stay informed.

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Salesforce CRM vs Oracle CX: Which CRM is the Winner?

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CRM software (customer relationship management) can make a huge difference in your organization’s relationship with its customers. Salesforce and Oracle are some of the most powerful solutions on the market, so it’s no wonder they’re common choices for cloud-based CRM. But which is better for your business? We break down Salesforce vs Oracle CRM feature-by-feature to help you make an informed decision.

Bergen AdairSalesforce CRM vs Oracle CX: Which CRM is the Winner?
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Manufacturing CRM Software And 7 Critical Benefits

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In the world of manufacturing, it might be tempting to think you don’t need CRM software. It’s only helpful for the marketing and sales pros right? After all, you have a lot of things to focus on as a manufacturer — production, distribution, the supply chain. But if a manufacturing CRM system isn’t on the list, you’re missing out on a world of opportunity.

Zachary TotahManufacturing CRM Software And 7 Critical Benefits
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B2B vs B2C CRM: A Comprehensive Comparison of the Difference Between Them

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Customers are the heartbeat of any business. It’s critical to manage that relationship if you want to see long-term success. However, that doesn’t mean all CRM software is a good option. Why? Because B2B CRM software and B2C CRM software aren’t created equal.

As a CRM buyer, you need to distinguish between the capabilities of the two. They’re very different and do different things for an enterprise.

Zachary TotahB2B vs B2C CRM: A Comprehensive Comparison of the Difference Between Them
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Salesforce Competitors: 20 of the Top Salesforce Alternatives

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Saying Salesforce is a big name in the CRM software space is like saying Christianity is a popular religion — it’s pretty obvious to most people who know anything about CRM. But it doesn’t have to be the only option. For those who may be looking for something else, we gathered data on the best Salesforce alternatives to help you find the right match for your organization.

Bergen AdairSalesforce Competitors: 20 of the Top Salesforce Alternatives
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Best CRM Campaign Management Software Tools

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Imagine your customers are fish. There are lots of fish in the sea, but only certain kinds that you want to eat — or, in this analogy, sell to. Marketing campaigns are the bait that brings the fish to your hook, where they can either be tossed back or sent down the sales pipeline. Designing a marketing campaign is like choosing the right bait. You want to attract a lot of fish, but you also want the right kind of fish. Marketing campaign management software by way of CRM tools with campaign management features is like a scientific research assistant that helps you study the fish, choose the right kind of bait, cast your line so it’ll land somewhere with a lot of fish and analyze what kinds of fish you caught and how to improve next time.

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How CRM CPQ Integration Can Drive Growth for Your Business

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Trends in the software world are like Star Wars fans — they’re everywhere. Over the past few years, CPQ (Configure, Price, Quote) has joined the party. Related to ERP systems and CRM software, CPQ solutions have bolted into the spotlight as a means for making sales teams more effective and productive. And one way to maximize the power of CPQ applications is by implementing CRM CPQ integration.

Zachary TotahHow CRM CPQ Integration Can Drive Growth for Your Business
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Salesforce vs SAP: Which CRM Software Is The Winner?

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Choosing CRM software (Customer Relationship Management) can feel like one of Hercules’ impossible tasks: there are so many, some cost an arm a leg and a sacrifice to the gods, and did I hear something about an Oracle? All jokes aside, just like Hercules had Eurystheus to help him out, you’ve got us. While there are many CRMs to explore, we’re going to break down the differences between Salesforce vs SAP CRM.

Bergen AdairSalesforce vs SAP: Which CRM Software Is The Winner?
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How to Define The Scope of CRM

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So you’re looking to implement a CRM software (Customer Relationship Management) solution for your business. That’s great! But first, you need to determine the CRM scope of the solution you’ll be implementing. Defining the scope of CRM projects means figuring out which areas of your business need to be included in the CRM implementation plan. Before any CRM initiative begins, scoping is essential to establish what the effort will and will not cover, as well as to prevent feature creep and project bloating. Follow the steps below to properly define the scope for your next CRM project.

Bergen AdairHow to Define The Scope of CRM
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The Big CRM Feature Comparison Chart and Matrix

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Knowing which features are most important in CRM software (customer relationship management) can seem like an uphill battle. So many vendors, so many features, so many choices. How can you know what to prioritize?

We get it. It’s a challenging process, and understanding what CRM features will best meet your needs and fit all of your company’s requirements is no small task. If you’re feeling lost, we wrote this article — complete with a handy CRM comparison chart — for you.

Zachary TotahThe Big CRM Feature Comparison Chart and Matrix
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Best Sales CRM Software for Sales Teams

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CRM software is a marketer thing — or is it? This common misconception is two things: not true, and hurting your business. That being said, not all CRMs are equally useful to your sales reps as they are to your marketing teams. So we compiled a list of the best sales CRM software to help you make informed decisions that will help you make your customers, sales teams and marketing one big happy family.

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Infor CRM vs Salesforce Sales Cloud: Which CRM Is The Winner?

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Micromanaging your business’ relationships with individual customers is so 2008. Customer relationship management (CRM) software has been making marketers, sales teams, and managers’ lives easier for years. Today we have a faceoff between two industry giants to help you determine which CRM system is best for your business. Salesforce and Infor CRM are two of the best options on the market, offering a wide array of helpful functionalities to their users.

We’ve created this introductory Infor vs Salesforce comparison chart to help make your decision a little easier.

Compare CRM Pricing & Costs with our Pricing Guide
Bergen AdairInfor CRM vs Salesforce Sales Cloud: Which CRM Is The Winner?
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Salesforce vs Act! CRM vs Zoho CRM: Which is the Winner?

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For companies looking at Customer Relationship Management dashboards, it’s important to get a tailored and customized solution that’s going to work for the business, rather than one that ends up confusing staff or hindering internal operations (see more from Gene Marks, a well-known expert on CRM, on HuffPo regarding using these tools the right way). Shoppers can look at a variety of types of functionality, along with pricing and service models, to figure out what works best for a particular business.

SelectHubSalesforce vs Act! CRM vs Zoho CRM: Which is the Winner?
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