With the growing number of affordable, Web-based products on the market, more and more small businesses are looking for customer relationship management (CRM) software to manage interactions with both current and prospective customers.
Many are seeking to upgrade from basic email marketing or contact management systems. However, the capabilities of CRM systems can range widely, with varying levels of functionality for sales, marketing and customer support. We developed this guide to help buyers understand exactly what these products can offer, so they can select the solution that best meets their needs.
Here's what we'll cover:
Thousands of small businesses contact us every year, looking for advice to help them select the CRM solution best suited to their company. Some are just getting started, while others are looking to replace an outdated or problematic system.
Startups may have their own needs, in some cases related to but unique from the needs of small businesses in general. If you're a startup, check out our guide to CRM for startups here.
Small businesses most commonly look to purchase a CRM system because they are:
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|Contact management||The core component of any CRM solution, contact management systems consolidate critical customer data (e.g., names, addresses and company info) into a single database, as opposed to scattering it across many individual inboxes or address books.||Most small businesses; any business that needs to organize contact information or associate notifications, tasks, notes, files etc. with specific customers.|
|Sales management||Basic sales management applications allow businesses to track deals at different stages of the sales pipeline, integrating sales activities and appointments with the general contact database. Some may also include limited automation (e.g., automatically sending follow-up emails or setting up reminders) and reporting.||Any small business with a dedicated sales team, or that needs to organize a high volume of leads and automate follow-up (e.g., real estate agencies).|
|Marketing automation||Entry-level marketing automation applications allow small businesses to quickly set up landing pages, Web forms and email templates that inspire potential customers to take action. They may also offer some degree of automation to send targeted, personalized messages based on prospects’ behavior.||Small businesses with a dedicated marketing team, and/or looking to attract potential customers through email marketing or Web traffic.|
|Customer service management||Simpler customer service applications typically focus on basic trouble ticket management, which allows small businesses to document, track and resolve customer issues.||Small businesses with a dedicated customer service team, or any business that needs to resolve a high volume of customer inquiries and/or complaints (e.g., software companies).|
Most small businesses should consider hosted, cloud-based CRM solutions. Because these systems are hosted by the vendor, they eliminate the need for you to have a dedicated IT team for managing and maintaining your own server. They also drastically reduce upfront investment and installation costs.
In addition, they typically offer monthly subscription pricing, which makes them scale well for fast-growing companies that need to add additional user licenses or features down the road.
However, small businesses with sufficient IT resources and capital may still benefit from on-premise CRM systems. These solutions usually require purchasing an expensive perpetual license up front, but they may become the cheaper option if you use the same system over an extended period of time.
You can see how pricing for these two models compares to figure out what works best for you using this tool. However, keep in mind that with on-premise solutions, you might also pay additionally for upgrades, customizations or maintenance.
With so many options and feature sets to choose from, selecting the right CRM for your small business can quickly become an overwhelming task. To narrow things down, here are four key factors for small businesses in particular to keep in mind as they evaluate different products:
Which Applications to Prioritize?
Because CRM encompasses so many functions (e.g., sales, marketing and customer service), many entry-level products are actually “best-of-breed” solutions. This means they focus on only one of the core applications listed above (although all CRM systems will provide some level of contact management functionality). “Integrated suites,” meaning solutions combining multiple applications in one software package (often billed as “professional” or “enterprise” editions) are much more expensive.
So before you begin shopping, start with a clear assessment of exactly which functions you need. The “Best for...” column in the chart above provides recommendations as to which types of companies may need which applications.
System Complexity and Ease-of-Use
Many small businesses we speak with say they’re replacing their CRM system because it’s too complicated or difficult to use. And if your employees find it too burdensome to input data into your program, you’ll wind up with a spotty, incomplete customer database, which defeats the entire purpose of having a system in place.
As a result, small businesses should pay particular attention to ease-of-use as they evaluate CRM software options. Consider solutions with smart, intuitive interfaces. Also, take advantage of the demos and trials offered by many companies to get a real sense of how user-friendly a system is.
While small businesses may not have as many integration requirements as larger companies, you should still consider CRM solutions that integrate with programs that you and your employees already use, such as email clients, calendars and accounting software.
For instance, integration with email clients such as Outlook and Gmail will make it much easier to import contacts and conversations into your new system. It also allows your employees to continue using the programs they’re comfortable with, while ensuring your contact database remains comprehensive and up-to-date.
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