What is Customer Relationships Management Software?
You might be asking yourself “what is a CRM?” A CRM system is a software tool designed to help businesses manage and analyze customer interactions and data throughout the customer lifecycle. It organizes crucial data such as contact information, communication history and purchase behaviors in one platform.
Why CRM?
There is a growing need across business leaders to improve the quality of interactions with prospects and customers over the majority of other factors – now more than ever. Consumers are savvy, and they expect personalized relationships with the brands and products they interact with. Those who ignore this and continue “spray and pray” marketing and sales communications will be left behind.
We sat down with Dani Mariano, President of Razorfish, to understand the importance of businesses building relationships with their customers. Mariano has 25 years of experience helping businesses with this, 10 of those years at the Razorfish marketing agency. “CRM is not just about managing contacts; it’s about understanding your customers deeply and engaging with them effectively at every touchpoint,” Mariano says.
“I think we’re in a renaissance, right now, of CRM. That stems from a couple of things. One, leaders have to justify every single dollar that they’re spending to the CFO and the CEO, and that requires them to be ruthless on how they’re prioritizing their dollars. If it is significantly cheaper to retain a customer than to acquire one, you have this data asset that you’ve been nurturing and creating; you now have a competitive advantage.”
Dani Mariano
President, Razorfish
When Does Your Company Need a CRM?
For small businesses aiming to enhance customer service, retain clients, drive sales and streamline data management processes, implementing sales CRM can be a game-changer.
If your organization struggles with scattered communication channels, disjointed customer data and manual data entry across multiple spreadsheets or applications, it’s a clear signal to explore CRM.
Benefits of CRM for Small Businesses
The benefits of a CRM for businesses, especially small enterprises, are manifold. It streamlines business processes, enhances marketing campaigns through targeted messaging and personalized interactions and improves customer service – enhancing customer lifetime value (LTV). Mariano underscores this, stating, “CRM provides businesses with a competitive advantage by enabling them to retain customers more cost-effectively than acquiring new ones. It’s about leveraging the data asset you’ve cultivated to drive growth and foster lasting relationships.”
Streamlined Business Processes
Different departments in your organization might present information in different ways and in different places. Most CRMs offer centralized dashboards that track the entire customer lifecycle. Some providers have templates, while others allow greater customization.
Example: A boutique hotel manager may use a CRM to manage reservations, track guest preferences and coordinate housekeeping and front desk tasks seamlessly, leading to improved efficiency and guest satisfaction.
Enhance Marketing Campaigns
Because marketing CRMs collect so much data, you can begin to see patterns of customer preferences and pain points. This information may be used for improving products and services, which customer segments are most likely to convert and when and where to focus future sales or marketing campaigns.
Example: An e-commerce store owner utilizes a CRM to analyze customer purchase history and browsing behavior. By identifying their behavior and preferences, they can tailor email campaigns and promotions to specific customer segments and adjust campaign bidding to return on ad spend (ROAS).
Improved Customer Service
Example: A software company’s customer support team uses a CRM to manage customer inquiries and support tickets. With all communication history in one place, support staff can access relevant information about previous interactions, ensuring higher quality responses to queries, leading to better customer satisfaction.
Additionally, a CRM not only centralizes data but can provide data security measures to protect sensitive information. Small businesses can benefit from features like role-based access control, data encryption and regular backups, ensuring compliance with data regulations and safeguarding customer trust – avoiding costly issues down the road.
Drawbacks
The downside to jumping into a CRM without due diligence is that it can be hard to parse long lists of features against complicated pricing plans. So, knowing what you don’t need may be equally important to knowing what you do need.
Some other drawbacks include:
- Cost: A free trial or, even better, a CRM with a starter or free plan lets you try a CRM to see what makes sense for your team’s workflows. However, a free plan might not be the best testing ground if you know there are certain premium features your company will need. Look out for additional expenses for customizations, implementation, training and ongoing support.
- Integration challenges: Integrating a CRM with existing systems and software applications can be complex, especially if there are compatibility issues or data migration concerns. Poor integration can result in data silos and disjointed workflows, undermining the effectiveness of the CRM.
- User adoption and complexity: There’s no avoiding the learning curve with almost any CRM. If you’re a beginner, start with a user-friendly CRM platform you can grow into, ensure employees are fully read into the benefits. If you’re working across different functional end-users (think tech, sales, and marketing), build that buy-in and understanding early.
CRM Pricing Features Ranked by Importance
- Least Important
- Less Important
- Neutral
- More Important
- Most Important
Contract flexibility
19% 25% 17% 14.5% 24.5%
Free version available
24.5% 17.5% 20% 16.5% 21.5%
Free trial available
7% 26% 17.5% 28.5% 21%
A la carte feature pricing
39.5% 17% 13% 11.5% 19%
Money back guarantee
10% 14.5% 32.5% 29% 14%
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MarketWatch Guides Survey Respondents
Expert Tip to Get Buy-In:
“You need to build buy-in – most leaders know they need a CRM, but they fail to build the buy-in necessary to take it across the finish line at their company. Managers get excited, don’t understand the ins and outs of it, then they throw it at everybody and say, ‘let’s get going on this,’ and people are like, how the heck do we use this thing?”
-Joe Karasin, Small Business Owner, Karasin PPC
How To Select the Right Small Business CRM – Insider Tips
We asked decision-makers what their top priorities are when selecting a CRM solution. Contact Management and Reporting factors were the most important for them when choosing a platform.
Small businesses often operate with limited resources and need solutions to manage their contacts effectively. Adequate contact management combined with the right reporting and insights is an essential outcome for SMBs to see ROI on CRM.
For SMBs in particular, there’s an urgency to drive results as soon as possible. Dani Mariano advises businesses to consider a crawl, walk, run approach: “ensure there’s a very clear understanding of what the early applications of the tools will be versus when it’s done to understand the payback on investment,” says Mariano.
You may not need the keys to the Ferrari just yet; many CRM companies will work with you to determine what features to prioritize while considering your short and long-term roadmaps.
Primary Use Cases for CRM Software
- Least Important
- Less Important
- More Important
- Most Important
Contact Management
22.5% 24.5% 17% 36%
Reporting and Analytics
19% 24.5% 28% 28.5%
Integration w/ Other Tools
24.5% 20.5% 26.5% 28.5%
Customization Options
19.5% 25.5% 28% 27%
Sales Automation
17% 29.5% 27.5% 26%
Mobile Accessibility
43% 18% 18% 21%
Role Based Permissions
31% 30% 22% 17%
Marketing Automation
23.5% 27.5% 33% 16%
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MarketWatch Guides Survey Respondents
Expert Tip to Plan:
“Think about the ‘crawl, walk, run.’ Ensure there’s a very clear understanding of what the early applications of the tools will be versus when it’s done to understand the payback on investment.”
-Dani Mariano, President, Razorfish
Questions To Consider When Shopping CRM
When evaluating the right product for your small business, consider answering the following questions about your business needs:
What are my goals and objectives?
Now that you understand a CRM’s main capabilities map out your primary reason for adopting the best CRM software. Are you looking to improve sales efficiency, enhance marketing campaigns, streamline customer service or another reason?
Which teams and employees will be using the CRM?
Identify the stakeholders and end-users who will be interacting with the CRM most, like sales reps, marketers, managers, customer service agents or IT staff. How will you incorporate them into the process?
Do you have any CRM experts in-house, or will they need a more user-friendly interface and/or personalized onboarding?
What onboarding resources and support will I need?
Users surveyed listed onboarding and ongoing customer support inside of the platform itself as an item not to be ignored. Static user forums are no replacement for personalized onboarding and support from real people when your business is in need.
CRMs not only store client contact information in one place, but they generally track all communication: form fills, calls, emails, text messages, meetings and any notes taken by your sales or customer service teams. This can ensure your team is in the right place at the right time.
CRM Customer Service Features Ranked by Importance
- Least Important
- Less Important
- More Important
- Most Important
Personalized onboarding
13% 23.5% 21% 42.5%
Video tutorials
6% 26.5% 34.5% 33%
Dedicated Account Manager
28.5% 25% 15% 31.5%
Chat support
6% 23.5% 39.5% 31%
Phone support
7.5% 27% 40.5% 25%
Help center
14.5% 39% 23% 23.5%
User forums
24.5% 35.5% 26.5% 13.5%
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MarketWatch Guides Survey Respondents
What specific pain points am I solving for?
What are the main inefficiencies in your organization? Fragmented data management? Poor communication between people or departments? Difficulty tracking various customer interactions?
Which features and functionalities are must-haves vs. nice-to-haves?
Assess the core features offered by the CRM platform. It’s tempting to draw up a list of every CRM feature you can think of, but check your list of features against your priorities and budget.
The following are the primary features and functionalities to consider:
Features punch list:
- Analytics and reporting
- Sales activity and performance: review metrics like “speed to lead” and “total talk time”
- Lead generation: lead tracking and customer journey insights
- Marketing campaign performance: broken out by ad metrics like conversion rate and cost per conversion
- Sales forecasts
- Customization and pipeline management
- Sales funnel, including custom stages
- Contacts and leads, including custom contact fields
- Contact management
- Email, text and call logs
- AI content creation: the most time-consuming part of communication can be the messaging component within your emails and texting, AI can be transformative in this regard for small businesses
- Document storage
- Mobile app
- Testing capabilities: platforms like Hubspot and Salesforce allow for testing of messaging inside the platform.
- Integrations
Expert Tip to Streamline Workflows:
“Leverage tools like Zapier alongside your CRM (freemium, limited to 100 semi-restricted tasks monthly) to streamline workflows and connect to existing systems without requiring built-in, native integrations or custom coding.”
-Joe Karasin, Small Business Owner, Karasin PPC
How scalable does the CRM need to be to accommodate my future growth forecasts?
Consider the scalability of the CRM solution to accommodate your business growth over time. Evaluate whether the CRM can scale in terms of data storage, user licenses and additional features/modules.
Review our comparison table and product breakdowns to calculate the cost of adding new “seats” and determine your cost of scaling. This can be more costly for some CRM platforms
Expert Tip for Scalability:
“Scalability is key,” says Dani Mariano. “Choose a CRM platform that can grow alongside your business without compromising performance or functionality.”
What is my budget for implementation and ongoing maintenance?
Evaluate the pricing plans offered by CRM providers, and consider both upfront costs and ongoing subscription fees. Look for flexible pricing options that scale with your business and offer value for money.
Bigin by Zoho CRM, Freshsales, Insightly and HubSpot are the four providers on this list with free plans, but there are others: EngageBay, Agile CRM and Bitrix24.
Monthly paid plans start around $7 to $20 and run up into the hundreds, even thousands, but a yearly upfront payment will almost always be less expensive overall. Pricing is by the seat — a single user might be $15 a month, for example, but add another seat, and it’s $30 a month and so on.
The lowest tiers generally offer the fewest features. Compare your list of must-have features against each tier and look for the vendor that offers the functionality you need at the price you can afford. Ideally, the tier you want is available for a free trial.
Are there any specific industry regulations or compliance requirements that my CRM must adhere to?
Determine if your business operates in a regulated industry or if there are specific data privacy and security standards that the CRM system needs to comply with, such as GDPR, HIPAA or PCI DSS.
The Future of CRM
CRM is poised to witness several transformative trends that will shape how small businesses interact with their customers. According to Statista, the CRM market is expected to climb $44.73 billion, and the average spend per employee will reach $264.70 in 2024.
AI and Automation: Artificial Intelligence (AI) will play a vital role, enabling businesses that were previously bootstrapped by their ability to create enough assets and the velocity to grow their business at a rapid pace. It will also allow for the quick analysis and forecasting of large data sets to predict and automate the delivery of those assets at scale.
“The ability for us all to use Generative AI to bring down the cost of real personalization and getting to personalization at scale is what’s going to allow everybody to start driving the Ferrari because now we have the assets to fill it. That’s always been the biggest challenge: we can’t get enough assets to deliver these personalized experiences. It’s just too expensive. Now we’re on the eve of that changing, so the CRM tools are going to become more and more important in the marketing mix.”
Dani Mariano
President, Razorfish
Omni-channel Integration: As the channels we use to communicate with customers expand beyond email, delivering channel-appropriate and personalized experiences becomes more important than ever.
Customer Data Platforms (CDPs): CDPs will emerge as a central repository for unified customer data, aggregating information from disparate sources and providing insights into various customer touchpoints.
First-party Data: With the depreciation of cookies, the ability to collect data directly from prospects and customers will give businesses the 1 + 1 = 3 edge when combined with CRM.
Voice-enabled CRM: Voice recognition technology and virtual assistants will enable users to interact with CRM systems through natural language commands, facilitating hands-free data entry and task management.
Blockchain for Data Security: Blockchain technology will enhance data security and integrity within CRM systems by providing a decentralized and tamper-proof ledger for storing customer data and transaction records, ensuring greater transparency and trust.
Hyper-personalization: CRM systems will leverage advanced segmentation and targeting capabilities to deliver hyper-personalized experiences tailored to individual preferences, behaviors and demographics, fostering deeper customer engagement and loyalty.
Emphasis on Customer Experience (CX): The focus on delivering exceptional customer experiences will intensify, with CRM platforms evolving to prioritize CX metrics, sentiment analysis and feedback mechanisms to measure and improve customer satisfaction and loyalty.
The Bottom Line
Finding the right CRM for your small business will depend on what business and customer management features matter most to you and your team. We’ve done the hard part and narrowed down the best-rated products for you.
The best way to know if a CRM is the right fit is to sign up for a free trial and test it out. The sign-up process is simple and typically only requires your email address and basic company information.
CRM Software Rating Methodology
Customer relationship management (CRM) tools help businesses bring in new customers and nurture current ones. With different businesses come different business goals and CRM needs. So, the MarketWatch Guides team spent over 100 hours evaluating 13 providers to determine who each CRM is best for. We looked at big names, such as Salesforce and monday.com, as well as small providers, including Liondesk and Less Annoying CRM.
We conducted a survey in 2024 of 200 professionals who were currently using CRM or had used CRM within the past year. We analyzed the results of this survey to determine the following rating criteria:
- User Experience (15%)
- Features (30%)
- Pricing (30%)
- Customer Support (15%)
- Reputation and Credibility (10%)
Visit the full CRM methodology page for more details on our rating system.
About MarketWatch Guides Team
The MarketWatch Guides team provides reviews of technology products and services to help readers make educated purchasing decisions. Our editorial team consists of seasoned editors, researchers and writers who are experts in the topics they cover. In addition, while we may earn a commission on our articles, our research, featured brands and recommendations are independent of and distinct from any financial compensation.
