What is CRM?

CRM stands for Customer Relationship Management. It is a set of strategies businesses deploy to improve their relations with leads and customers.

The term CRM is widely used to denote CRM software—a tool designed to manage interactions with buyers and optimize/automate the selling process.

Read on to find out some interesting facts about CRM and how it can help improve your business operations.

How does CRM Software Help your Business?

Customer relationship management is literally what CRM software does. From the time a customer comes to know about your brand to sales and support—CRM software takes care of various facets of your relationship with customers. It can help you with:

Lead capture

Sales and marketing teams use various sources of lead generation. Collecting all the leads in one place helps manage leads better and understand which channel is performing better.

Typically, a CRM system allows you to capture leads from:

  • Voicemails and inbound phone calls
  • Digital ads
  • Websites
  • Online marketplaces
  • Chatbots and live chats
  • Social media
  • Online portals

Lead distribution

Once you have generated leads, you need to assign them to sales reps to follow up. But did you know 78% of customers buy from the first responder? And the ideal lead response time is less than 5 minutes. But wait, how will a sales rep know that a buyer has submitted an inquiry?

Well, that’s why you need to use CRM software to distribute leads to sales reps and notify them. The distribution is automated and can be based on agent attributes like role, lead quality, location, languages, agent performance, and more.

Lead management

Lead management involves all the steps necessary to convert a lead into prospect. It is applicable to both–

Since sales are heavily reliant on managing relations with leads and customers, CRM software is helpful. The typical modules of lead management are:

Tracking sales

A CRM helps you track sales activities as well as the status of a lead in the sales funnel. A typical sales funnel comprises of the following stages:

  • Awareness
  • Interest
  • Decision
  • Action

(Depending on your sales process, the number of stages in the sales funnel may vary) CRMs help by automating funnel activities like lead nurturing. They also keep sales users updated about the funnel movement and remind them to follow up as per the set schedule. Finally, all the data gathered in the process can give you insights into your sales performance, which you can use to optimize your sales strategy.

Automate processes

A CRM can help you automate many of your marketing and sales processes.

Marketing automation

The marketing automation module in a CRM system helps you:

  • Send email, SMS, and WhatsApp marketing campaigns to all or a particular segment of leads in your CRM system.
  • Trigger automated communication based on lead activities like ad clicks, email link clicks, website visits, etc. It can even notify sales reps about these activities to encourage them to follow-ups with them.
  • Create automated lead nurturing workflows for your marketing leads.
  • Consolidate channel performance reports, measure ROI from each of your marketing channels, and more.

Sales automation

More than 30% of sales processes can be automated to save sales reps’ bandwidths, such as:

  • Lead distribution
  • Notifications for new lead assignments and task reminders
  • Lead scoring and qualification
  • Sales autoresponders
  • Meeting schedulers and reminders
  • Follow-up reminders for sales reps
  • Automated follow-up campaigns for cold leads

Analytical insights

Data-driven organizations are three times more likely  to see better outcomes from their decisions compared to those who rely less on data.

CRM tools organize information related to marketing, leads, and sales activities into an easily digestible and actionable format. Managers can utilize this information to improve their processes and make better decisions for their teams. Examples of such reports are:

  • Daily/weekly/monthly sales reports
  • Opportunity dashboards
  • Marketing analytics or marketing channel wise sales reports
  • Region-wise or team-wise sales pipeline reports
  • Revenue report
  • Average time to win a customer report

Types of CRM

CRM systems have evolved to manage business relations with customers as well as align teams and processes and utilize interaction data to make business decisions.

Broadly, there are 3 types of CRM.

  • Operational CRM
  • Analytical CRM
  • Collaborative CRM

Apart from this, CRMs can be classified based on the user base (B2B or B2C CRM), model of software delivery (on-premise, cloud or hybrid), accessibility (Web, Mobile), and license (open-source or proprietary).

Operational CRM

This CRM category streamlines a company’s customer-facing operations—mainly sales, marketing, and customer service.

  • Marketing automation CRM: Covers lead capturing, nurturing, managing email and SMS campaigns, marketing workflow automation, and campaign reports.
  • Sales CRM: Covers lead and sales process management, sales automation, and opportunity management.
  • Customer service CRM: Covers capturing and distributing support queries and reporting.

Analytical CRM

Almost all CRMs available today have analytical capabilities. However, analytical CRM is specifically meant for working with customers’ behavioural and intent data, analysis, and reporting.

Collaborative CRM

A collaborative CRM integrates multiple business functions, like sales, marketing, inventory, etc., in one platform. Tasks like contact management and channel sales management are simplified with collaborative CRM.


It is meant for B2B companies with comparatively lesser lead volume. They are built to manage longer sales cycles. Customizable CRM tools are better suited for B2B needs.


A B2C CRM can handle a high volume of leads coming through various sources. Here, the call volumes are high, and marketing campaigns are sent to many recipients. These are generally standard products with limited customization requirements.
Also read: B2B vs B2C CRM

On-premise CRM

These are built by a company for their own use. Companies that deal with sensitive information, such as banks or insurance firms and prefer not to let a third-party vendor handle their data opt for on-premise CRM.

Cloud CRM

It is hosted on the CRM provider’s servers. Users can access the CRM services through the internet and on any mobile device.
Also read: On-premise vs cloud CRM

Mobile CRM

It is a CRM app that delivers the functionalities of a CRM on smartphones, tablets, and other internet-enabled devices. Mobile CRM is especially beneficial for outside sales reps who would want to manage their tasks on the field.

Open-source CRM

Here, the CRM software’s source code is publicly available to use and customize according to the business requirements.

How Do You Know You Need a CRM?

You may get overwhelmed with the vast number of sales, marketing, and customer data. And that’s okay. What’s not okay is to not utilize it. And that’s the first signal to start looking for a CRM tool. In the following points we will try to reinforce your idea of getting a CRM for your business.

  • Communication
  • Information
  • Leads
  • Reports
  • Campaigns
  • Mobility
  • Time Management

You are facing communication challenges

Imagine you have sticky notes all over your desk, a calendar cluttered with notes and business cards scattered here and there You are still using the communication apps intended for personal use and digging through emails to find the right information. For instance, you are using WhatsApp for talking to clients while also using Gmail or Outlook to send official emails to the same people. Worse, you also end up missing deadlines and follow-ups.

Solution: CRM.
It helps you integrate all your communication tools so that all the interactions can be recorded in one platform. Via CRM, you can also send messages over channels your client prefers.

Digging through spreadsheets is confusing

All businesses start with spreadsheets at first. They are simple and get the job done. However, spreadsheets are not enough as the business grows.
Over time, the spreadsheet will increase in number of rows and columns. You will soon find that you are storing a lot of redundant data in the spreadsheet. In later stages, you break up that spreadsheet into more sheets, but linking them is hard. Searching through them is even more challenging.
If such is the case, you will need a relational database. CRM database allows you to store and access complex data formats. This data is completely synchronized. For example, if a deadline changes, all team members are notified. If you get a new lead, the data is visible to all.

You are losing leads

With so many sources of lead generation, it’s imperative to lose track of some and miss on leads coming from those sources.
Sometimes, leads sit idle in the system because there’s no one to follow up with them. Why? Mainly because no one knew about them.
CRM software minimizes such instances by automating the lead capture and assignment processes.
In a single workflow, you can capture leads from many sources and distribute them to sales reps based on their attributes.

Sales reports are hard to read

Sales reps spend about 22% of their time in general administrative tasks. That includes creating and maintaining reports.
But these reports may have discrepancies and may not tally with the book of business.
Since CRM software has all the data needed for the sales reports, you will get to know the true picture of your business through CRM reports.
Some CRMs also generate reports in visual formats—making it easier for the management to understand it simply in a glance.

Marketing campaigns are not delivering results

The reasons why you are not getting the desired results from your marketing campaigns could be:

  • Incorrect messaging or sending a generic message to all your prospects and customers
  • Not knowing your customers and their interests well
  • Campaigns are not timed properly
  • Not knowing the marketing channels that can bring you revenues

With CRM, you can personalize your messaging basis the client details you have like name, their company’s name, age, gender, etc. Also, a CRM can give you correct inputs on:

  • The types of campaigns that have worked for you in the past
  • Customers, their needs, source of acquisition, etc.
  • Channel-wise customer acquisition cost
  • Email delivery rate, optimum time to send emails/texts, etc.

The above information can help you refine your campaign strategy.

You cannot work when you are away from your desk

This point is applicable to sales agents who go door to door to meet their clients. What would you prefer?

  • Making notes while on field and then manually feeding those records in computer, or
  • Using an app to feed those details while being on the field

Obviously, the latter. One, because it saves time. And two, you can do more work on the field. Mobile CRM apps are helpful here. They help you access lead details, get notified when you are assigned a new lead, input meeting notes, get meeting reminders, and more.

It is getting harder to manage your growing business

The number of customers is increasing. You are hiring more employees. There are more interactions with customers, more conversations between teams, more marketing. While it sounds like a growing business, it also signals the internal chaos. A CRM tool can help reduce that chaos.
It helps you with sales and marketing management, where you can:

  • Define processes and create a trackable workflow in the CRM
  • Give you an overview of your sales ops
  • Helps you manage your teams, their tasks, and performances
  • Helps you manage escalations
  • Manage marketing attribution

If all or any of the above points sounds like your struggle, it’s time to get a CRM for your organization. But wait, what should you look for in your CRM? Let’s find the answer to that

What Should You Look for in Your CRM Software?

Before everything else, list down teams who’d be using the tool and the functionalities they’d expect. Then, evaluate the software based on functionalities and trust for the vendor and try to answer the following questions.

  • Does the CRM tool serve all or most of the use cases you listed?
  • Is the tool customizable (If it does not have the module you need)?
  • Does it integrate with other software you use? (Like telephony, ad platforms, etc.)
  • If your team grows, would your software be able to accommodate more users? (Without increasing the price exponentially)
  • Does your CRM software vendor provide customer support? And how good is that?
  • How long is their implementation time, and does it work for you?
  • Do they provide platform training?
  • Is the software compliant with GDPR/HIPAA regulations?

Download the checklist [editable PDF] of essential features and support you should look out for in a CRM vendor.

Red Flags

To watch out for while selecting a CRM

Less than an average 3-star rating on review sites

First, read online reviews of the CRM software you’ve shortlisted. Especially the negative reviews (or reviews with 1-star ratings). Positive reviews may be scripted, or buyers may be incentivised to spread good words. But negative reviews come from frustrated customers. If their challenges with the software sound like a concern for you, it’s better to speak with the vendor to clarify those points.

The CRM can do a lot of things, but not exactly what you need

Some CRM providers may take pride in the number of features they’ve built. But it’s of no use if the tool does not support the basic features you need to run your business.
So, you can look for a simple CRM that serves the purpose

Hidden costs

Many CRM features have hidden costs associated with them. So, check contact limits, messaging limits, etc., even if they’re marketed as all-inclusive.

Limited integration capabilities

If the CRM system you’ve shortlisted doesn’t support integrations with everyday tools you use, you may end up juggling between platforms. Data will be inconsistent, and eventually, you may not be able to adopt the CRM platform very well.

Data security

If the system isn’t ISO or GDPR compliant, you may be at risk of compromising your customer’s information.

red flag sec

Businesses That Have Realized Huge Benefits by Implementing a CRM

The most important benefits of CRM that people have reported in the live Bing survey are:

  • Improving customer satisfaction and loyalty
  • Increasing sales and revenue

Let’s Take a Few More Examples of How CRM is Being Used in Different Industries for Business Growth.

CRM in healthcare

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New Jersey-based hospice and home healthcare provider, Ennoblecare, is using healthcare CRM to:

  • Capture and categorize leads according to the care they seek
  • Create patient profiles for automated yet personalized communication
  • Automate workflows for their practice

“We have clear visibility on every single lead that comes in through LeadSquared.”

Hicham Moro, Operations ManagerEnnoble Care

Read complete story of Ennoble Care.

CRM in education

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California Career Institute, a leading institution for medical career, uses Education CRM for:

  • Gaining visibility into their admissions pipeline
  • Communications automation
  • Student portal

“With LeadSquared, we can take a deeper look at our processes and utilize new technology to study how we’re doing as an institution.”

Maggie Zaman, Director of AdmissionsCalifornia Career Institute

Read California Career Institute’s story.
Here’s another story of how EdTechs use CRM in their sales operations.
BYJU’S, the Indian EdTech giant uses EdTech CRM for:

  • Pre-sales
  • Post-sales
  • Order management

“It makes it easy for you to measure both your marketing and sales parameters easily and without much error.”

Mrinal Mohit, Chief Operating OfficerBYJU’S

Read BYJU’S journey of growth after implementing CRM.

CRM in real estate

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Shapoorji Pallonji International Property Developers, uses real estate CRM for:

  • Automating lead capture process
  • Real estate broker onboarding and management
  • Improving agent productivity
  • Lead prioritization and management

“We’re able to capture 50% more leads from various sources.”

Rohit Satyavrata, Senior Marketing ManagerShapoorji Pallonji Group 

Read the complete story here.

CRM in travel and hospitality

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Acron Homes and Hospitality, a known name in Goa, India for their hospitality and real estate establishments, uses Travel CRM for:

  • Lead management
  • Sales tracking and management

“You might have the best product in the world and the best sales team. But without leads, it is like a car without fuel and that car is not going to go anywhere.”

Dr Joseph Britto, Co-founder and DirectorAcron

Read Acron Homes’ story here.

CRM in financial services

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Pune-based Poonawalla Fincorp, a leading name in the Indian financial services sector uses Lending CRM for:

  • Automating loan origination and approval processes
  • Upselling and cross-selling loans
  • Self-serve loan portal
  • Assessing creditworthiness and e-KYC

“Our agents are more efficient, and the journeys are more seamless, helping us deliver a premium experience to every borrower.”

Kandarp Kant, Chief Technology OfficerPoonawalla Fincorp

Read Poonawalla Fincorp’s CRM story.

CRM in insurance

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Ditto Insurance, the seller of health and term insurance policies, uses Insurance CRM for:

  • Lead Capture and distribution automation
  • Tracking conversations between leads and sales reps
  • Sales funnel management
  • Setting up daily tasks and reminders for insurance agents

“Automated lead assignment helps us save a lot of time and bandwidth, and we can focus on what we do best—provide good insurance advice and service.”

Lokesh Gurram, Co-founderDitto

Read Ditto’s story here.

CRM in stockbroking

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India’s 3rd largest stockbroking firm, Angel One, uses stock broking CRM for:

  • Multichannel lead capture automation
  • Lead distribution based on pre-set logic
  • Monitoring customer interactions and ensuring call quality with agents
  • Marketing automation for customer communications

“With the help of the right tools, our lead engagement has become measurable, and the lead volume has increased from 50k to 6 lakhs per month.”

Prabhakar Tiwari, Chief Growth OfficerAngelOne

Read Angel One’s CRM story.

CRM in logistics

Freight Systems, an international freight forwarding company, uses CRM for:

  • Process automation
  • Managing marketing campaigns
  • Managing data

“We have optimized the performance of our existing people, resources, and data to increase our productivity by 50% in just three months. We now dial more numbers and connect with more people every day.”

Savio Rodrigues, Manager-Inside SalesFreight Systems

Read Freight System’s story.

History of CRM

Building good relations with customers has been a trade norm for ages. Even during the old stone age! However, the term, “Customer Relationship Management” was first used in the 1970s. Companies gauged their customer satisfaction directly by asking them. In the mid-20th century, computers became commercially available. People started keeping digital records of their leads/customers’ details. People in sales also used Rolodex, a rotating file device to store business contact information. In 1982, Kate and Robert D. Kestenbaum introduced Database Marketing. It is a method of collecting, analyzing, and processing customer data for sales and marketing purposes.

Fast-forward today
  • 1970
  • The 20th Century
  • 1950
  • 1982
  • 1986
  • The 90s
  • Fast-forward today


What does a CRM system do?

At its core, the CRM system is designed to manage communications with customers and align all stakeholders involved in interactions with them. However, CRM systems have evolved to perform complex tasks like automating processes, setting up workflows, tracking all conversations and using all the sales and marketing data to derive meaningful reports.

What is CRM software used for?

CRM software is used for:

  • Aligning teams and automating customer-facing processes
  • Standardizing sales processes and automating them
  • Managing customer tickets
  • Tracking the performance of various marketing sources
  • Reporting and analytics

How much does a CRM system cost?

Depending on the features, the cost of a CRM system may start from $10-$25 per user per month. CRM companies also offer custom plans for specific features.

Why is CRM important for marketers?

With CRM, marketers can check the performance of their marketing sources, evaluate touchpoints, and more.
A CRM helps marketers better understand customers and tune their messaging accordingly. Marketers can also personalize their messages using lead details captured in the CRM platform.

Why is CRM important in sales?

Because sales reps pursue many leads, CRM plays a significant role in organizing them as per their stages in the sales pipeline. It also helps them keep track of interactions with prospects, schedule meetings, set reminders, and more.