What is a CRM and what is it for?

In today’s article we will explain ‚úÖ What is a CRM how it can boost the quality of customer services in your company ūüí° Read on!

Should I implement a CRM system in my company, are CRM and ERP the same thing, what is a CRM for…? We clarify all the doubts you can imagine in this article.


What is a CRM and what is it for?

Before going in depth about the advantages of a CRM and why you should implement it in your company, you must understand what a CRM is and what it is for. We explain everything in the following sections.


What is a CRM?

To know what CRM is, we must first indicate that its acronym refers to Customer Relationship Management.

CRM refers to the set of practices, business strategies, project management and technologies focused on the relationship of a company’s team with customers.

A CRM is ultimately much more than an Excel shared among the employees of a company, a software or a customer database.

The CRM is the basis for managing any interaction between a company and its customers, where:

– All interactions of the company with its customers are centralized.

– Different areas are managed, such as: commercial management, marketing and customer service.

– All the company’s information is centralized in a single platform that can be accessed by all employees.

– It is based on a deep knowledge of the customer, their profiles, preferences and needs.

For all these reasons, we say that a CRM system has as its main function the relationship with both own and potential customers.

Continue reading the following section to know what a CRM system is for.


What is a CRM for?

Now that you know what a CRM is, you will better understand what a CRM is for:

These systems can be implemented in companies of all types and serve to centralize data and information, optimize processes, improve profitability and boost business growth.

At a general level, we should highlight that a CRM is useful mainly because of the following:

It improves internal communication and leaves nothing pending, since tasks can be assigned, projects, leads, etc. can be tracked.

Employees are more productive, since all the information is integrated in the platform and a lot of emails, meetings and calls sending or requesting information about customers to colleagues are avoided.

The sales department is able to generate more sales, because they can easily keep track of all their leads in a personalized way.


how does a crm work


The CRM is not just an elaborate contact list, because, above all, it collects, stores, manages and integrates a very valuable customer database with purchase histories of your customers, the preferences of your potential customers, and so on.

A CRM is, in short, essential to increase sales and productivity of all types of companies.

Now that you know what a CRM is and what a CRM is for, read on to learn how it works.


How does a CRM work?

After reading what is a CRM and what is it for, you will understand much better how a CRM works.

The CRM works as a platform with multiple unified tools that are responsible for performing tasks such as:

Recording and storing data of current and potential customers (name, address, phone, email…).

Interactions with current and potential clients: visits, calls, emails, etc.

All the information that is recorded in the cloud is useful so that, through the platform, there is a coordination of the work team and the interactions with customers are refined, either to get a lead, personalize the attention or build customer loyalty.

We see below what would be the work and operation of a CRM according to the department:


crm and erp


Most CRM systems manage sales, marketing and service processes, although as we saw in the previous diagram, it can be the key to optimize other areas of your company. We explain below how a CRM works in different areas:


The data of your potential customers are very valuable for your company. The moment a user contacts your company through a form, phone, email or any other means, their data is recorded in the CRM.

Any type of interaction that an employee has with this user will be recorded in the system, so that it can be used to improve communication and sales arguments, since we will be able to know, for example, their buying preferences.

A pre-sales CRM will then function as an agenda where we keep all the information of a potential customer and that will help us to offer them campaigns of their interest until they become part of the company’s customer portfolio.


In this area, CRM serves as a means to analyze the conversion tunnel and to identify what aspects to improve and what strategy to create to increase sales. The CRM system will help us to sell more in less time.

In the area of sales, the CRM will provide us with relevant information about our customers at this stage and will become a solution to manage the pipeline and optimize the entire process of capturing opportunities, negotiating and closing sales in a fast and organized way.


The information stored in the system is the key to boost the demand for the product or service.

The application facilitates customer segmentation, which is very important to design campaigns and improve the positioning of the brand, product or service.

The operation of the marketing area is fundamental to obtain leads. We can use CRM to reach potential customers before they reach us.

We will create strategies that will attract them, call their attention to buy in our business or hire our service.

A CRM system helps to optimize this sales process, since, by having all the information about our audience, we can apply more focused segmentation criteria and persuade the most receptive customers.

In addition, thanks to segmentation, CRM provides us with statistical information on the markets that are most profitable for our company.

The CRM system will allow us to target our campaigns to the right customers, as well as communication based on the purchase history of each customer.

The CRM will also allow us to analyze behaviors and attitudes following interactions in order to be able to make marketing mailings to groups that share similar characteristics.


It offers the opportunity to establish personalized, fast and effective communications with customers through emails, instant messages, chats, calls….

A CRM system can simplify, for example, the process of sending follow-up emails to leads, since this can be done automatically.

In addition, it offers the possibility of being integrated into the corporate website, which will allow all the contacts that arrive through this channel to be automatically registered in the system so that a salesperson can attend to them as soon as he/she is available.

It also has an electronic agenda to send reminders to department employees, such as: support tickets to be answered, scheduled meetings, comments to be answered, etc.


As important as pre-sales, after-sales service is in charge of customer loyalty. We must remember that it is easier to retain a customer than to find a new one.

A CRM in the after-sales stage is a key tool, because it helps us to achieve customer loyalty. From their data, current and past preferences, we can predict future revenues and sales figures.


CRM, why is it important for a company?

A CRM system is the solution that makes the digital transformation of a company possible.

Invest in the quality of your customer service, digitize your commercial process, increase sales and productivity of your employees.


what is a crm and what is it for


All companies, regardless of their size, need a CRM for the correct management of their sales and customers.

The importance of using a CRM system lies in the quality of service and the amount of work it is capable of handling.

If you have a very small company with only one salesperson, then you may not be able to see the value of this tool.

If you work with more than one salesperson in your sales department and with customers who are looking for personalized attention and support in the purchasing process, then you will be able to recognize its value.

CRM represents a digital support for the sales department. Each interaction with a potential customer, insight, data or comment, will be recorded on the platform and will be a great support for sales management, offering quality in each service.

If a company has not yet digitized its sales process, it will have much more difficulties to stay in a competitive market.


CRM, what types are there?

In this section of the article “what is a CRM and what is it for”, we will explain in depth the types of CRM that we can find.

Each CRM offers its own functionalities and although they have many features in common, we can differentiate several types of CRM:

according to its functionalities (analytical, operational or collaborative and according to its hosting (on-permise and online).

We explain below the characteristics of each one:


CRM according to functionality

According to the objective of each company, you can choose between the following types of CRM:


Analytical CRM

The analytical CRM is based on the analysis of all the information in the customer database in order to know them and offer them commercial solutions adapted to their needs.

Its functions are:

– Analyze the behavior of customers in order to offer them a better service.

– To design segmented commercial actions according to the profile of each one.

– Evaluate and subsequently measure marketing campaigns and their effectiveness.

– To structure in databases all the information coming from customers.


Operational CRM

Operational CRM is based on the automation of customer-facing processes (Front Office), including sales, marketing and customer service management.

This type of CRM also integrates the Back Office, which is the management behind the company, such as accounting and finance.

The main functions of an operational CRM are:

– Interact with customers and establish a relationship of trust and loyalty.

– Manage marketing, sales and customer service functions.

– Collect all possible data from customers to know their needs and offer them a suitable product or service.


Collaborative CRM

The most remarkable thing about this CRM is theinteraction it maintains with customers through different communication channels such as: email, telephone, chats, etc., establishing a link with them that leads them to know their needs.

In this way we manage to centralize information and customer data and organize them based on the objectives of the company.

Essential functionalities are as follows:

– Create a multichannel communication between all departments of the company, as well as interact with customers.
– Improve the relationship with the company’s customers.

In the table below you can better see the benefit and drawback of each type of CRM according to its functionality:




CRM according to hosting

Depending on the needs and budget of the company, they will be able to choose between the following CRM:


CRM on-permise

This is a local CRM with its own physical server in the company. The server will require maintenance and updates by a specialized IT team.

The software will be installed directly on the server or on a computer used as such.


Online CRM

Also known as CRM in the cloud or Cloud, it is based on cloud computing.

Online CRM is managed from the cloud, so it does not require installation on a computer or physical server or a dedicated IT team to maintain and update the software.

This is also the reason why online CRM can be called software as a service (SaaS), as the entire infrastructure is managed remotely by the system’s team of experts.

With a cloud-based CRM, employees will enter the platform through a login home page accessed by inserting the crm address in the browser.  They will be able to access the platform from any device with an internet connection, anytime, anywhere.

We will see below a small summary of the advantages and disadvantages that we can find with these two types of CRM depending on where they are hosted:


what is a crm

 CRM, what features should it have?

When looking for the optimal CRM for your company, you must take into account some basic characteristics that it must meet. Now that you know what a CRM is, when you want to implement it, make sure it has the following characteristics:

– Be fast

– Secure

– Easy to use

– Mobile

In addition to all of the above, these features should be able to be complemented by the following:

– All-in-one platform

– Customizable

– Available online and offline

– Easy implementation

– Available with technical support.


CRM, what are its advantages?

Is it worth implementing a CRM system? Below we will indicate in this article dedicated to know “What is a CRM and what is it for”, several fundamental advantages that will make it very clear to you:

– Improve the relationship with customers: this system is a great formula to manage the database of the company in a simple way and collect in a single platform all the information of our customers and potential customers.

If we use all this information properly, we will be able to get closer to our customers and create campaigns and strategies related to their needs and preferences.


crm integration


– Optimize the targeting of marketing strategies: the information stored in the CRM will allow you to extract statistics and deduce in advance which strategies and campaigns are suitable for your business.

Every company is different, so this system is one of the best ways to manage your customer information and know what they can demand.


crm platform meaning


– Significantly increases sales: the increase in sales is one of the most obvious advantages why companies decide to implement this system.

The collection of information about our potential customers and leads, allow us to develop more and more specific commercial campaigns that will help us to find our target audience. Once this work is done, sales success is practically assured.


crm meaning marketing


– Centralize all the information: with a CRM we can have a platform where all the information of the company is collected and accessible to any employee who needs to consult it.

This will also help us to automate processes, make a personalized customer service and ultimately, be more efficient every day.


crm app


CRM and ERP, how do they differ?

Once we know what CRM is and all its features, we must know what an ERP is and the differences that exist between CRM and ERP.

ERP is the initials of Enterprise Resource Planning, Enterprise Resource Planning translated into Spanish.

ERP is a tool used to control process management, such as: maintenance, accounting, logistics, production… among other functions.

The most important difference between CRM and ERP is that the former focuses on loyalty, while ERP supports the organization and management of processes.

In addition to the fact that their objectives are different, they are tools of different incorporation and implementation within the company, since a CRM has a simple implementation, while ERP tends to be more complex.

In spite of everything, CRM and ERP are two strategies that can complement each other and in many occasions, they should do so, especially if we are talking about large companies.




So much for everything you need to know about the topic “What is a CRM and what is it for”. As you can see, implementing a CRM software in your company can help you simplify daily tasks and optimize your time with more relevant tasks.

We hope the article has been of interest to you and has encouraged you to implement this system in your company like many of our customers.

If after knowing what a CRM is, you want to continue reading other articles about business optimization and technology, we invite you to follow our blog!

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Por: Nati CaballeroPublicado el: 26 de septiembre de 2022