CRM

CRM (customer relationship management) is an approach and, usually, a program for managing interaction with customers: it stores data about them, analyzes it and helps coordinate sales, marketing and support (Wikipedia, CRM).

This article is short and general. For CRM specifically for an online store, with an example and metrics, see CRM for an online store.

In plain words

A CRM is a "customer card" where everything lands: who this is, when they got in touch, what they bought, which team member talked to them. Instead of searching through spreadsheets, email threads and messengers, you open one card.

CRM comes in different kinds. According to Wikipedia, it is divided into sales, marketing and service automation, and into analytical and collaborative CRM (Wikipedia). In practice, business owners more often say "CRM" about the program, and it works only if the team has rules: who enters the data and what is done with it.

Why a business needs it

• Nothing gets lost: leads from the site, calls and messengers are in one place.
• The customer's history is visible, so a conversation does not start from zero.
• It is a basis for repeat sales: segments, reminders, mailings (for example, by RFM).
• You can calculate LTV and CAC per customer.

When you need one

• There are so many inquiries and channels that they are hard to keep in your head or a spreadsheet.
• More than one person works with a customer.
• You want repeat purchases and need lists of "who to write to."

When it is too early

If you have few customers and orders are already visible in the store admin, a spreadsheet or the admin itself is enough. Choosing a CRM without a list of the actions you need (3–5 reports or scenarios) usually ends with a system nobody uses. Wikipedia names this risk: low usage and data without action.

How it relates to other systems

• To the store platform: orders and customers reach the CRM through integrations.
• To ERP and the accounting system: they handle money and stock, the CRM handles people. Some ERPs have a built-in CRM module.
• To a CDP: a CRM stores information about known customers and the work with them, while a CDP gathers behavioral data from many sources into one profile.
• To OMS and WMS: a CRM sees the order status, but the order is managed by the OMS or the store itself.
• Many CRMs are SaaS.
• Customer personal data is regulated by the Law of Ukraine "On Personal Data Protection" (in force, the current version is on the Verkhovna Rada site), so you should know where and for how long you store it (zakon.rada.gov.ua). This is not legal advice.

FAQ

What is a CRM in plain words? A system that keeps everything about customers in one place.

How is a CRM different from an Excel spreadsheet? In a spreadsheet everything is entered by hand, while a CRM collects leads from channels itself, sets tasks and shows the history. But it needs discipline.

Do you need a CRM if you have a store admin? The admin handles orders and the catalog. A CRM handles the customer and the communication with them. For a small store that is sometimes enough.

How is a CRM different from an ERP? A CRM is about customers and sales, an ERP is about internal processes: money, stock, purchasing.

Related terms

• CRM for an online store
• CDP
• ERP
• LTV (customer lifetime value)
• RFM analysis

Sources

• Wikipedia, Customer relationship management — en.wikipedia.org/wiki/Customer_relationship_management
• Verkhovna Rada of Ukraine, Law "On Personal Data Protection" No. 2297-VI — zakon.rada.gov.ua/laws/show/2297-17

There is no recent data on CRM use in Ukrainian stores.