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What is a CRM System? A Simple Explanation


In a world where things change every day and everyone is vying for the client’s attention, connecting with your customers is not only useful. It can make the difference between your business being successful or failing the competition and going out of business. If you don’t monitor how and with whom managers communicate, you can lose clients, and, therefore, your income.

A Simple Definition of CRM with Example

CRM is like a smart record book. It helps you run your business more systematically by managing all client affairs. You can monitor all your customers, e.g., by tracking what they bought and what they might want to purchase in the future. 

According to noltic.com, a team of experts in Salesforce solutions, a good CRM system makes communication with clients much easier, especially if you are truly interested in developing your company and planning on increasing the number of clients.

“Customer Relationship Management” is the only correct way to decipher the CRM abbreviation. In practice, this is all about managing customer relationships, including communications, sales, brand advocacy, retention, etc. 

Let’s take an example. CRM creates a special page for each client, where all interactions with the client are recorded: calls, letters, and messages. So, you can always go in and see who the customers are, what they want, and what they talk about. This information helps better understand the client in order to sell him more and better products in the future.

A CRM system is not just a program or an online service. It’s like a philosophy for a customer-oriented business. It helps you not just talk to clients, but also begin to understand what they really want and to start working better with them at every stage, from first communication to making purchases and offering further services.

Main Functions and Tasks of a CRM System

The work of a CRM system is built around the concept of a sales funnel. A sales funnel shows you how to attract, engage, and convert prospects into your customers.

In this regard, a CRM system ensures:

  • managing leads – the system captures potential clients and helps process and manage a large number of leads;
  • customer segmentation – based on accumulated data, a sales team can determine who they work with, which helps to improve the effectiveness of all marketing efforts;
  • sales forecasting – estimating future sales based on data about customers and their behavior;
  • customer journey analysis – the system tracks the customer’s path through all stages of the sales funnel.

A CRM system automatically collects all the above information, allowing you to adjust your interactions with the customers and increase conversion.

Final Remarks

Understanding the need for CRM is a pivotal point and a key decision for any business owner. Today, companies can find a wide range of ready-made CRM systems and relevant online platforms. The choice always depends on your industry and specific business goals.

Implementing CRM is a fantastic investment in your relationship with your customers, where the key benefit is nothing short of increased sales and successful business growth.