CRM tools come with a lot of business advantages, and if you’ve decided against using CRM in your organization due to a lack of familiarity, you might be missing out on the best available solutions for some of your biggest challenges.

But if you don’t know that and don’t have anyone you can ask, what else are you supposed to do?

We got you. In this article, we’ll cover the basics, the key benefits of CRM software, the drawbacks and whether or not you should be leveraging CRM for your organization. Then you’ll be better prepared to make important decisions regarding how and when to use CRM solutions.

What are the benefits of CRM?

Put in the simplest terms, CRMs serve as a command center that allows teams to better serve leads and customers throughout the entire lifecycle. The right solution can keep all of the relevant information for sales, marketing and customer service in a single source of truth, so everyone is working with the same data and critical insights.

SEE: How to Create Effective CRM Strategy

Of course, CRM solutions provide the same core benefits that most business software is designed to achieve. What makes CRMs stand out are their customer experience functions that enable sales, marketing and customer success to refine their approach to external-facing relationships.

Let’s dive into some of the top benefits of CRM software.

1. Workflow optimization

Like any good digital business tool, a CRM is designed to take laborious, manual processes and streamline them to reduce friction and mental inertia. So many “best practices” feel like more work than “the way we’ve always done things,” and that makes any process overhaul a tough sell. But if the computer is doing most of the heavy lifting, well, clicking a button doesn’t sound too bad, even if you have to do it a few times before you’re done.

2. Data integrity

In a similar vein, digital systems help reduce and/or eliminate the less helpful aspects of human participation: data entry errors, missing information, messy databases, lag time and so on. Human brains are pretty impressive, but there are things that computers do indeed handle better than us — recording, transferring and sharing information, chief among them.

3. Analytics insights

It’s hard to argue with the value that large datasets can offer, provided they’re accurate. Scientific fields have known this for decades, and the majority of our modern marvels are built upon principles of peer review, rigorous testing and constant experimentation.

With the advent of “big data” and business analytics, the corporate world is finally starting to catch on, as the data can often tell you why your product works and why it doesn’t, or who’s buying and who’s not. Sure, you can shoot from the hip when you’re making major business decisions. But when you could instead base your strategy off of verified, data-backed research, why would you?

4. Audience and lead targeting

This is where CRMs start to stand out from other digital tools. Plenty of B2B technology solutions can make work easier, help with data and empower you to make more effective decisions. CRMs do this specifically for the teams that bring in customers and the teams that take care of customers once they’re onboard.

With the right systems generating the right data, you’ll know if your prices are too high (or too low). You’ll also know if your marketing is working, is almost working or needs a total overhaul. And you can tell if you’re overpromising during the sales cycle and underdelivering after signup. All of that is just the beginning.

5. Supercharged support

Finally, CRMs help track both the progress and the end result of customer support and, in some cases, fulfillment. A boost in sales is good, but not if it’s accompanied by a major drop in retention, and the only way to know is to track the numbers.

CRMs can help collect data from every interaction and touch point and identify areas of concern or opportunity, and you can present proof that the CS team is doing the best with what they have. Then you can start making adjustments, either on the sales funnel side or on the product side, to better align your offerings to your customers’ needs.

6. Inter-department communication

While CRM software is a sales solution, sales teams are not the only ones who use it; teams in marketing, administration, support, logistics and more can all access the same information to ensure transparency of valuable information. Teams can securely tag one another for tasks, follow up, leave notes and even strategize future campaigns from one hub without having to jump between applications.

7. Quicker deal closing

With the help of a CRM tool, businesses can continuously monitor their CRM cycle to ensure maximum efficiency. Having all customer data, interactions and history in one dashboard ensures the sales process, from lead generation to nurturing and objection handling, can run leanly and smoothly.

When there’s less time spent on moving data around or following up manually, reps can focus entirely on customer relationships and moving projects forward. This will directly result in quicker deal closing, happier customers and more profit.

8. Customer retention

CRM software can help your sales reps engage with clients in appropriate cadences throughout their buyer’s journey. With all their information and account history stored in one place, reps are able to troubleshoot customer issues quickly, resulting in higher client retention.

Are there any disadvantages to using CRM?

Like any business software, CRM solutions aren’t perfect. CRM has its shortcomings, and there are some problems it can’t do anything about.

First, let’s point out some of the things a CRM platform won’t fix for you. No software or optimization tool, CRM or otherwise, can fix problems caused by things like:

  • Low-quality product or service.
  • Misleading, predatory or false marketing.
  • PR disasters caused by illegal, unethical or problematic business practices.

A CRM can certainly help you pinpoint causes and develop answers to those causes. But they won’t resolve problems on their own.

As for the drawbacks, there are a few noteworthy ones:

  • Implementation costs: Setting up a new software platform takes time, money and other resources that may be in short supply.
  • Adoption resistance: Not everyone is keen to start learning how to use a new platform, and not everyone is quick to pick it up once they do.
  • System compatibility: Depending on your current infrastructure and your tech stack, getting new software up and running may be a challenge (or outright impossible).
  • Security concerns: Some providers are better about data privacy than others, and that can have an impact on GRC considerations you may have.
  • Garbage in, garbage out (GIGO): The quality of a system’s output depends heavily on the quality of the input. If the way your team uses CRM is putting garbage in, then garbage out is all you’ll get.

How CRM works

You’re probably already familiar with what a CRM is, even if you’re not sure if implementing one is right for your current team. But if you haven’t seen one in action, you may be curious about how exactly it works within a business.

So let’s compare it to project management software and what you might lose without CRM software to give you a glimpse.

Similarities to project management software

You’ve likely used or seen a project management tool before. These software platforms help teams coordinate their efforts as they work toward the completion of tasks and objectives. A PM tool allows you to assign, track, monitor and record a project and all its subordinate requirements.

A PM tool lets teams ask questions and share information, flag issues or notify teammates of completed tasks, centralize the storage of relevant documents and files, and a lot more. It makes it easier to stay organized, improve team collaboration and efficiency, and maintain transparency and visibility across the entire workflow.

That is, in many ways, exactly how a CRM functions. The key difference is that with a CRM, what you’re tracking aren’t products and projects. You’re tracking sales leads, marketing campaigns and customer accounts.

What a team looks like without CRM

A less optimized system might silo information, with separate records kept by marketing teams, sales teams and customer support teams. If a lead is qualified, or a sale is closed, that hand-off from team to team might happen manually, slowing things down and introducing potential data entry errors.

Worst of all, without a unified system, these teams lack an easy way to collectively identify trends on a number of fronts, like the effectiveness of customer acquisition efforts, potential upsell and cross-sell opportunities, common customer complaints and so on.

That might present a major obstacle to success and growth. Or maybe it’s less of a priority than other, more pressing concerns. But that all depends on the business in question.

What companies can benefit from a CRM?

Organizations of any size can benefit from adopting CRM software into their sales process. Startups, small businesses, mid-size companies and enterprise-level corporations can use a CRM tool to manage their customer data.

Apart from company size, CRMs can be specifically categorized into the industries it can serve. Depending on the industry your business is in, you might require certain features to operate efficiently and effectively. While some CRM providers offer general core features with additional customization to match your business’ specific needs, others are built with particular industries or business-sizes in mind.

For example, construction companies need invoicing and quote management tools, nonprofits need ways to track donations and plan events, and contact centers need a tool to manage and assign incoming tickets.

How to choose the right CRM

Since the market for CRM software is so vast, I understand that it might be intimidating to narrow the choices down to one solution and feel confident about it. There are several factors to consider, such as CRM pricing, in-market experience and general UX/UI. Fortunately, it’s standard for CRM providers to offer demos and lengthy free trials of their software so companies can test out the tool and see if it could be a fit before committing to a subscription.

Here are some questions I suggest fleshing out before purchasing CRM software:

  • What is your allocated budget for purchasing a CRM platform?
  • How many users do you anticipate having access to the CRM platform?
  • How quickly do you need it implemented and set up?
  • What technical expertise do your reps have?
  • Does the provider have in-market experience in your industry?
  • How scalable is the CRM platform?
  • Does it offer integrations with your existing tech stack, such as your email provider?

PREMIUM: Choosing the right CRM for your organization.

Are CRM systems worth it?

If you’re looking for help with a cost-benefit analysis on this topic, we can only get you part of the way there. We’ve listed some of the benefits above — optimization and efficiency, analytics insights, transparency, scalability and all-around better performance for sales/marketing/CS — as well as some of the major hurdles.

What we didn’t do, and can’t do, is lay out the specifics tied to your team, your business, your industry or your use case.

Even if using a CRM isn’t the right call for your team currently, there’s no way to know that unless you take a good look at what they can offer. So take a look at some of the top CRM providers, follow CRM best practices and see if the ROI is worth the investment and hassle.

Top CRM tools

While obviously not a comprehensive list, we have a few CRM platforms we can recommend for a closer examination. The solutions below are some of the top CRM software in the business:

Frequently asked questions (FAQs)

How can a CRM help you?

CRM software can help companies improve their customer relationships, increase sales profit and so much more. Companies that are implementing a CRM for the first time can expect to see a drastic improvement in their sales reps’ productivity, thanks to workflow automations and omnichannel communication. Additionally, businesses can better visualize their sales process to proactively spot faults and continuously evolve their selling strategies.

What is the main purpose of CRM software?

CRM software’s main purpose is to help marketing, sales and support teams eliminate siloed sales processes by presenting all customer data, including contact information, activity, purchase history and more, within one hub.

Beyond housing information, CRM software can manage lead generation campaigns as well as produce visual pipelines representing workflows, reports and forecasting. CRM software can streamline tedious or long sales processes into automated workflows with the help of advanced technical functionality.

What are the pros and cons of a CRM?

Pros of CRM software include increased productivity, customer satisfaction and detailed sales reporting and profit forecasting.

While the pros of a CRM greatly outweigh the cons, it’s important to know what risks or vulnerabilities come with any major business software. First, the quality of the customer data within a CRM is only as good as what reps submit. Second, while there is free CRM software, these solutions can be costly depending on the number of users and add-ons.

This article was reviewed by Allyssa Haygood-Taylor.