Customer Relationship Management (CRM) Software

There are hundreds of customer relationship management (CRM) solutions on the market, despite a decade of aggressive consolidation. There are systems for large enterprises, for the small businesses, for different industries requirements, and applications for sales, service, marketing, and more. This fragmented market leaves buyers with a big challenge as they evaluate CRM reviews to identify which product is right for their needs. We’ve written this buyer’s guide to help.

Here’s what we’ll cover:

What is CRM Software?
Application Categories
What Type of Buyer are You?

Market Trends To Understand
Benefits & Potential Issues

 


What is CRM Software?

Customer relationship management is the discipline of managing an organization’s interactions with customers throughout the entire relationship. Software supports these activities with applications for marketing, sales, and customer support. A well-implemented system will increase the number of customers for an company, increase the satisfaction of those customers, and grow revenue and profit in both absolute and per-customer measures.

Application Categories

Marketing Automation Assists in creating and managing marketing activities and campaigns. Functions include campaign management, lead scoring, lead nurturing, collateral management, and campaign reporting. Example vendors include Eloqua, InfusionSoft, and Marketo.
Sales Force Automation Assists in managing and optimizing sales rep activities and reporting. Functions include contact, lead, opportunity, pipeline, sales forecasting, and territory management. Example vendors include Microsoft Dynamics, Salesforce.com, and SugarCRM.
Customer Service & Support Used to track and manage customer service issues. Functions include trouble ticketing, load balancing, agent coaching, contact channel management, escalation, scripting, and workflow. Example vendors include Zendesk, Oracle, and PhaseWare.
Field Service Management Manages and supports field services operations. Functions include technician scheduling, dispatching, parts inventory and ordering, and service contracts. Example vendors include Service Pro, Microsoft Dynamics, and SAP.
Call Center Automation Manages inbound and outbound calls for organizations and is often a component of CSS software. Functions include call logging, load balancing, call list management, autodialing, scripting and workflow, and computer telephony integration (CTI). Example vendors include Salesforce.com, Microsoft Dynamics, and Oracle.
Help Desk Automation Assists in generating and tracking trouble tickets from the initial contact to problem resolution. Functions include trouble ticketing, contact management, resolution tracking, asset monitoring, and reporting. Example vendors include Zendesk, PhaseWare, and Spiceworks.
Channel Management Helps organizations manage indirect sales partner relationships. Functions include lead and contact management, channel partner financial information, channel recruiting, and partner portals. Example vendors include Goldmine, Oracle, and Microsoft Dynamics.

What Type of Buyer Are You?

Before doing a CRM software comparison, you’ll need to assess what type of buyer you are. We believe over 90% of buyers fall into one of these four categories:

  • Enterprise buyers. These buyers work for organizations that have invested in or are considering an enterprise resource planning (ERP) suite. In most cases, seamless integration is more important than specific features. However, these buyers benefit from the increasingly powerful solutions offered by ERP providers.

  • Best-of-breed buyers. These buyers are focused on specific functions. For example, companies with a large field service force may focus on dispatching or scheduling or firms with a high-volume call center programs want strong agent scripting. Typically, these functional requirements will trump the need for seamless integration.

  • Small business software buyers. These small businesses want to upgrade basic contact management like Outlook to support more sophisticated functions like SFA, customer support tickets, or marketing campaign management. They typically seek an easy-to-use system that supports all of their needs. They also might consider open source CRM software due to a limited budget.

Trends You Should Understand

As you do a comparison of the best customer relationship management software for your needs, keep these trends in mind. How your vendor fits with these trends could have a big impact on their viability.

  • Social CRM. The biggest trend is the convergence of customer relationship management software and social networking technologies - “social CRM.” Organizations are using social media tools like Twitter to address customer satisfaction issues and Facebook to friend prospects. Savvy firms mine social networks to find issues, then proactively address them.

  • Software as a Service (SaaS). SaaS offerings are commonplace. Salesforce pioneered this market and is, in fact, only available in the cloud. An outgrowth of SaaS is Platform as a Service (PaaS), which allows organizations to develop apps in the cloud, without investing in a data center. One of the main benefits of SaaS software is increased accessibility. SaaS systems can be accessed from multiple devices using either Mac or PC operating systems.

  • Mobile apps. Mobile applications are becoming increasingly sophisticated and popular. Your users will care deeply about what devices are supported and their first impressions of mobile apps will impact adoption.

  • Web self service. Customer self help, for both sales and support, allows customers to order products and correct issues without talking to human customer agents. This decreases per-customer costs on both sides of the transaction.

  • ERP vendors as leaders. All of the major ERP vendors now have at least a decade of offering customer relationship management software, and their products have matured. Oracle stands out through its Siebel acquisition. SAP and Microsoft have both developed excellent solutions. Today, buyers can look to their ERP vendor for best-of-breed systems.

Benefits & Potential Issues

The key benefits of a system are increased sales and lower costs for marketing, sales support, and customer service. These are realized in several ways. Increased customer satisfaction extends customer contracts and leads to repeat sales and referrals. More effective delivery of marketing messages, better lead generation, and targeted sales efforts yields a faster sales cycle and better use of sales force resources. Automated customer support tools reduces costs for handling after sales.

The entry cost for customer relationship management software has never been lower considering the continually falling price of computer hardware and relatively low cost of subscribing to SaaS solutions. Meanwhile, the opportunity costs of failing to implement a system can be very high. We recommend that you look at some CRM software reviews to see what benefits and issues other users have experienced.

Have an opinion on this guide? Email the authors. We appreciate the feedback.

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Top 10 Most Recommended Systems

Sage ACT!

One of the most widely-used software solutions in the world, Sage ACT! is an affordable, effective client management system for the small business.

2 Reviews

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LeadMaster Lead Management

An industry contender since 1998, LeadMaster is an extremely comprehensive, fluid sales lead management software, offering an arsenal of web-based solutions for sales force automation, lead tracking, and more.

4 Reviews

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Sage SalesLogix

Sage SalesLogix is a premium CRM offering for midmarket organizations, with a legacy strength in sales force automation. With multiple deployment options, users have a consistent user experience, whether in-office or on the go.

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Microsoft Dynamics CRM

A global solution available in more than forty languages, Microsoft Dynamics CRM should be on the shortlist of the mid-market and enterprise organization looking for an industry-specific, end-to-end system.

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FieldOne

For service companies looking to streamline workflow into a single, intuitive interface, FieldOne encompasses every aspect of both daily operations and back-end administration into a single, web accessible solution.

4 Reviews

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InfusionSoft

Designed specifically for small businesses, Infusionsoft is a powerful solution that can be used across most industry segments.

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AIMcrm

AIMcrm is an industry leader in the web-based market with an exceptional presence among small- and medium-sized businesses.

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PlanPlus Online

PlanPlus Online is a complete online solution for customer relationship management and business collaboration. It includes modules for SFA, customer support and email marketing, all designed to enhance overall productivity.

18 Reviews

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Salesnet

Salesnet is a customer relationship management solution with extensive SFA capabilities for both the small and large organization. Salesnet offers professional services to help organizations with implementation and training.

2 Reviews

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FieldAware

FieldAware is a web-based field service management solution that helps every member of the team, from the service manager, scheduler, field personnel and account manager, better manage the service delivery process.

1 Review

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Interactive Timeline

CRM Software History


PRESENT
1980
1990
2000
2010

Future
1980s
Evolution of Database Marketing
Direct Marketing, a practice pioneered by Lester Wunderman, evolves to Database Marketing. Database marketing put more emphasis on statistical techniques for understanding customer behavior. This data was then used to create personalized communications with potential customers. Robert D. "Bob" and Kate Kestnbaum are often viewed as the trailblazers of this practice. Suggested by: Neil Woodcock
Late 1980s
Introduction of Client/Server Architecture
Client/server architecture is introduced, spurred by the wide adoption of PCs. This provides end users with far more computing power on their desks and creates an opportunity for thousands of new software companies. The earliest front-office vendors have their roots in PC-based contact management software during this era.
1986
First Contact Management Software
Pat Sullivan and Mike Muhney found Conductor Software. They release their first product, ACT! in 1987, which is recognized as the pioneering contact management application. Goldmine and other vendors followed suit with their own releases of contact management systems.
Early 1990s
Contact Management Becomes Sales Force Automation
Contact management evolves into sales force automation (SFA), and early innovators such as Saratoga Systems and Brock Systems make their debut. These systems automated standard processes for sales professionals to promote efficiency in tracking their leads, opportunities and deals.
1993
Siebel Systems Enters the Market
Tom Siebel forms Siebel Systems, which will become the dominant SFA player in short order. Earlier in his career, Siebel headed Oracle's direct marketing division and created a program to streamline the sales process. He tried to convince Oracle CEO Larry Ellison to package the internal application for sale. Ellison does not see the opportunity.
1995
Term "Customer Relationship Management" Coined
The term "customer relationship management" (CRM) wins out as the most popular term for front-office applications. Most industry insiders credit Gartner with coining the term, but others will point to Tom Siebel, IBM or John Anton. Several terms including CIS (customer information system) and CIM (customer information management) float around for several years, but CRM wins out.
1997
ERP Vendors Expand to Front Office
Oracle enters the CRM market with the roll-out of Oracle Sales and Marketing (OSM). Meanwhile, ERP vendor Baan acquires customer relationship management software provider Aurum. It becomes clear that the major ERP vendors are setting their sites on the front office.
1998
CRM Expands Beyond Point Solutions to a Broader Suite
Siebel acquires Scopus, adding leading call center technologies to Siebel's traditional strength in sales automation solutions. While viewed as an aggressive undertaking, the deal made clear that competition in the CRM market was moving beyond point solutions to a broader suite of sales, service and marketing applications.
1998
SAP Enters Market to Rival Larger Vendors
SAP seriously enters the CRM market by establishing SAP Labs as a unique research and development organization which would focus solely on emerging application categories like CRM. It becomes clear that the real battle for CRM leadership will come down to Siebel and the large ERP vendors.
1999
Acquisitions Lead to Consolidation of the Market
PeopleSoft acquires Vantive, a historically strong player in the customer support market. Vantive had raced to build out SFA and compete with Siebel, but was was unable to keep pace. Rumors of a PeopleSoft/Vantive combination swirled for years; PeopleSoft ultimately bought Vantive on the cheap after the target's financial results had slowed significantly.
1999
CRM Goes Mobile
Siebel releases Siebel Sales Handheld, one of the first mobile CRM applications. The following year, other major vendors such as Oracle, SAP and PeopleSoft released their own mobile applications. While these early mobile applications were limited in functionality, today's smart phones deliver almost 100% of the CRM feature set.
1999
e-CRM Vendors Provide Stiff Competition
Emerging "e-CRM" systems like e.piphany, Broadbase, Kana and Silknet gain momentum and the appreciation of Wall Street investors. These systems rode the wave of the ill-fated dot-com bubble as Siebel and other legacy software vendors raced to adapt to new Internet era technologies.
1999
Salesforce Enters Market as First Major SaaS Vendor
Salesforce.com enters the scene as the first major player in the Software-as-a-Service (SaaS) CRM space. Originally, Salesforce is viewed as a "toy" for smaller businesses. However, the system evolves to add functionality and scalability, eventually threatening to disrupt industry leaders such as Siebel Systems.
1999
Nortel Buys Out Call Center Leader Clarify
Telecommunications giant Nortel buys out Clarify, one of the leaders in call center solutions. The combination suffers with the collapse of Nortel's core networking business. The Clarify business is eventually sold to AMDOCS, a software and services business focused on the telecommunications market.
2001
Burst of the Dot-Com Bubble
Dot-com bubble bursts and the CRM market retracts. Oracle experiences a loss in license revenues of over 25%. Even industry titan Siebel Systems is impacted, posting its first quarterly decline in revenue. e-CRM players fall the hardest as enterprises halt spending on "dot com" technologies.
2001
Sage Enters Market and Expands Through Acquisitions
Sage enters the CRM market with the acquisition of Interact Commerce, Inc. Sage goes on to acquire SalesLogix, expanding its CRM offering to become a leading vendor in the SMB segment. The majority of the company's growth is the result of acquisitions.
2001
Greenberg's "CRM at the Speed of Light"
In February, Paul Greenberg releases "CRM at the Speed of Light"ť. The book, now in its 4th edition, introduced the idea of 'xRM,' which expands traditional CRM to encompass the management of all relationships, both internal and external, for-profit and non-profit, and government and municipalities. Suggested by: Leon Tribe
2002
Integration With Legacy Systems Becomes a Selling Point
Microsoft enters the CRM market with the release of Dynamics CRM. The product is fairly limited in its initial release, but touts strong integration to Microsoft Outlook as a primary benefit. The product will evolve to make Microsoft a strong contender in the CRM market.
2004
SugarCRM Becomes First Major Open Source CRM Vendor
In June, SugarCRM is founded as both a for-profit start-up and an open source project on Sourceforge.org. "Sugar" was one of the first open-source enterprise applications. The application gained rapid adoption amongst early adopters and price conscious organizations. SugarCRM later rolled out a cloud-based version of its product. Suggested by: Martin Schneider; Christopher Nielsen
2006
Siebel Wiped Out In String of Oracle Acquisitions
Oracle acquires Siebel after years of dueling for CRM leadership. Siebel had fallen on tough times and founder Tom Siebel had turned over the reigns to new leadership. With little light at the end of the tunnel, Siebel agrees to become the next addition to Oracle's pile of acquired enterprise applications.
2007
Launch of Force.com
Salesforce.com launches Force.com, a cloud-based application development environment. The platform enables Salesforce to build an ecosystem of SaaS partners, address gaps in its product line and counter the notion that cloud-based systems are not customizable. Suggested by: Marshall Lager
2008
Switch in Focus From Transaction to Interaction
Comcast kicks off @ComcastCares, one of the first examples of a large company using a social network to interact with customers. This strategic Tweeting garnered positive feedback and significant media attention. Other corporate giants followed suit and social CRM was validated.
2009
New Technology Expands Customer Service Capabilities
Web self-service becomes a top priority for SaaS vendors. The traditionally high cost of customer service, combined with long waiting times in queues drive this development. RightNow acquires HighLive, a customer community platform vendor. Oracle announces their integration of InQuira's web self-service applications with Oracle CRM OnDemand. Salesforce.com adds a knowledge management and customer Q&A feature to their Service Cloud.
Future
Looking Forward: Trends to Watch in CRM
Social CRM and the future of the industry. Where will the CRM industry go next? With the introduction of concepts such as Customer Enterprise 2.0, Sales 2.0 and Social CRM, we can anticipate an increased focus from vendors on how to incorporate these new technologies into a CRM strategy. Currently, many vendors have 2.0 or social functions, but they have yet to figure out a way to integrate these concepts in such a way as to realize their full potential. Also, with new technology comes new blood. We expect to see a good amount of smaller vendors enter the space in an attempt to capitalize on this new technology, similar to what we saw in the early years of SaaS.