How Do You Know If You Need A CRM? 3 Questions You Should Ask Yourself

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A Sales CRM (or Customer Relationship Management) platform like Salesforce, Highrise or Zoho is one of the three core sales and marketing technologies along with email marketing and web content management.

But of these three core technologies, you could easily argue that CRM is the least well-adopted among small businesses. Where a majority of firms marketing online will have both a content managed website and a subscription to an email marketing platform, only 50% of businesses with less than 10 employees use a CRM, though about 74% of businesses in general do. And another fun fact, up to 60% of CRM implementations fail to meet expectations (for more on these numbers, check out this post).

So of our three core technologies, CRM is the one a lot of SMB’s just don’t know what to do with.

What a CRM actually does

Generally speaking there are three primary reasons a company will buy a CRM, and yes I am oversimplifying a bit:

  1. To centrally store and organize all company customers, prospects and contacts
  2. To manage the sales cycle and pipeline
  3. To track customer history and correspondence, providing an electronic “paper trail” for your company’s interactions with an individual or company

These are basic needs that many business have… But do they require that you purchase a CRM platform? Maybe not. I advise asking yourself these three questions before buying:

1. How complex is your sales cycle?

If you’ve only got a couple of steps in your sales process and the primary “need” you’re trying to fill is organizing contacts and separating the leads from the prospects, Google Contacts or MailChimp could easily fill that need much more cost effectively than a CRM. But a complex sales cycle — or customer retention process — might be better served by a “proper” sales CRM.

2. How large is your sales organization?

Pipeline management is obviously key in just about any organization — you want to know how much business you are bidding and how likely you are to close it so you can appropriately manage resources and cash flow. But if you only have one or two people working sales, your pipeline might be more easily managed in a spreadsheet. With a bigger sales department though you’ll need something more sophisticated and a sales CRM would be a necessity.

3. How many people will directly touch a client?

When it comes to the necessity of centrally storing all the correspondence that comes with each company and individual your firm deals with, consider how many individuals in your business are required to serve a single client. If several people may work directly with a particular client, it would be extremely useful to give them all easy access to that individual’s complete account history. If it’s only one person, Outlook or GMail may be just as effective.


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