A brief history of CRM

In a single century, we’ve gone from commerce being limited to local, face-to-face interactions, to the global business market of the 21st century, where the only limitations are defined by your internet connection and mobile service. Pen and paper were t

But one thing that hasn’t changed is the importance of the customer. Whether you’re selling horseshoes or hoverboards, you won’t be getting very far unless you can convince someone to commit to a purchase. No matter how you look at it, there’s no denying that customers are the lifeblood of every business. As such, your relationship with your customers will determine your future success, and that means that you need customer relationship management (CRM).

What is CRM?

Despite never having the proper periods, CRM is actually an acronym that stands for ‘customer relationship management’. Broadly, CRM is any practice, technology, or strategy designed to help businesses improve their customer relationships.

In today’s marketplace, CRM most often refers to the specific tools, usually a web application or software, that allow organisations to focus their attention on individual customers and associates—be they buyers, suppliers, service users, or anyone else the organisation does business with.

Given the importance of maintaining and perfecting customer relationships, one might assume that these tools have been a mainstay of business for as long as the concept has existed, but the reality is that CRM is a relatively new development.

Early Days of CRM (Pre-1990s)

Not long ago, businesses were forced to view their customers impersonally, as target ‘demographics,’ comprised of oversimplified stereotypes designed to reflect the average characteristics of the larger group. And while this may have been an adequate method of better understanding the typical customer, the reality is that ‘typical’ customers don’t exist. Every customer is a unique individual, with individual wants, needs, and concerns.

When a business treats these customers as some kind of archetypal model used to represent the entire client base, then you are likely to miss the aspects that make them unique.

To combat this danger, the CRMs of the 1980s and before came in the form of ledgers, rolodexes, filing systems, and other paper-based tools. These early analogue versions of CRM allowed companies to better keep track of personal customer information.

This tedious, manual (and not to mention eco-unfriendly) process would evolve when computers and digital technology started becoming widespread among businesses. Customer management software was developed and these programs were able to connect to databases full of customer data.

Customer-focused software began its meteoric rise when the first digital CRM, then known as CMS (Customer Management Systems), was first introduced in the mid-1980s. Early on, CMS systems were glorified digital rolodexes, and two well-known CMS companies in the 1980s - ACT! and Goldmine - provided the bulk of these systems to companies interested in collating and organising large amounts of customer data. Continued evolution of the product, along with the introduction of personal computers, brought widespread adoption and advancement to the CRM industry.

But even though CRM now had email lists, productivity programs, contact management software, and all of the paper documentation used by companies large and small, there was still something of a disconnect when it came to managing customer relationships—until modern CRM technologies hit the scene.

The Life and Death of CRM Software

Modern customer relationship management software first arrived during the 1990s, with the push from contact management software, toward sales force automation (SFA). SFA made it possible to retain the functionality of contact management software, while automating certain key tasks, such as customer interaction tracking. The term CRM was coined during the mid-90s, and brought the concept of customer relationship management firmly to the forefront of business consideration, resulting in more and more organisations investing in creating CRM software applications. The increased competition led to a more varied selection of CRM applications, each offering a wider suite of services.

These improvements to CRM allowed for more focused marketing efforts, greater ability to address individual customer issues, and an improved level of automation. This led to increased time efficiency for the organisations in question, and an enhanced ROI over previous software tools. However, CRM didn’t become the unparalleled game changer it is today, until the introduction of “the cloud”.

CRM in the Cloud

The cloud is a term used to describe the use of networked computers to store and process digital information. This information can then be accessed from anywhere in the world through an internet connection via web-based CRM applications. The cloud also enables users to coordinate together across different platforms, each accessing the same, constantly updated information, all without the need for expensive in-house hardware installation or maintenance. In short, the cloud brought with it a means by which companies could unify their customer-service strategies.

Today’s CRM is a comprehensive, heavily automated solution for all aspects of the customer journey. And by improving the customer experience, organisations that invest in CRM are seeing extremely positive results. In fact, the average ROI for companies that invest in CRM is €4.54 for every single euro spent. Taken all together, CRM is a universally beneficial solution to the issue of customer relationships, and will doubtless remain an essential factor in business success for years to come. Gartner even predicts that the global CRM market will have risen to a worth of €30 billion by 2017. However, before an organisation can begin to reap the benefits of advanced CRM software solutions, it must first understand the features, functions, and capabilities that make CRM valuable. This will make it possible to better determine which tools and CRM solutions are the correct fit for a particular business.

Salesforce is the world’s #1 Customer Relationship Management (CRM) platform. It offers cloud-based applications for sales, service and marketing for small, midsize and enterprise organisations, with a focus on sales and support. It brings together all customer information in a single, integrated and scalable platform that enables businesses to build a customer-centred business from marketing right through to sales, customer service and business analysis. This gives businesses a more complete understanding of their customers to drive business success.