Different types of Customer Relationship Management (CRM) solution

The better a business can manage the relationships it has with its customers the more successful it will become. Therefore, software solutions that help businesses build better relationships with their customers are becoming increasingly popular. These systems are called Customer Relationship Management (CRM) systems. In this article we look at different types of CRM system.

Reading time - 12min read

By James Virgo

Date - 7th November 2024

The better a business can manage the relationships it has with its customers the more successful it will become.

Therefore, software solutions that help businesses build better relationships with their customers are becoming increasingly popular. These systems are called Customer Relationship Management (CRM) systems.

Customer Relationship Management (CRM) is not just a software. CRM is a business philosophy that, if implemented correctly, can improve both the efficiency and effectiveness of your customer acquisition and retention.

With good CRM in place, you will be able to learn more about your customers needs and behaviours and build stronger long term relationships with them. Your business will not just be focused on loading deals into the top of your sales funnel, making proposals and closing new business, but you will also be able to collect critical feedback from clients’ needs.

CRM will help you (amongst other things) understand where business is being lost, when and why customers are likely to stop using your platform and when and how to re-engage with your customers to ensure that you present them with ongoing solutions that they need and will be highly grateful for. CRM will help you grow your revenue, but also improve the happiness of your clients.

Whilst CRM is more of a business strategy than a technical solution, it does rely on technology. This guide outlines the business benefits and drawbacks of CRM. It also offers help on the different types of CRM solutions and how to implement them.

Why you need a CRM?

When running a business, the importance of getting customers and retaining existing customers is paramount to your business’s expansion. The cost of acquiring customers means that you need to maximize the amount that customers will spend on your products and services (i.e. the customer lifetime value).

To maximize your customers lifetime value, it is absolutely essential that you find opportunities to do new business with your prospective customers, but also to interact with your existing customers.

One way of finding new customers is to explore different sales channels such as direct sales, online sales, affiliate sales etc. Depending on your company’s size, there is a limit to the number of sales channels that you can realistically run and not all sales channels will work for your business.

That said, to expand your revenue you have two options: (1) widen your existing sales channels and / or (2) test and open new sales channels. The ultimate goal is to increase your sales activity e.g. more leads, more proposals going out to prospects, more business closing and more revenue. However, the more sales activity and channels that you have, the harder it will be to keep track of how each sales channel is performing and what the overall happiness of your clients are.

Customer Relationship Management (CRM) helps you gain data first insights into your customers behaviour helping you to adjust business operations to ensure your customers are better served. Note, a data first approach is absolutely essential, since you need feedback that gives you an honest, accurate reflection of your business so that you can make informed decisions.

In short, CRM helps you collect and organize data on your prospective and existing customers so that you can better understand your customers and be more responsive to their needs.

However, to install good CRM into your business it is not just the case of buying and installing a CRM software. You will also need to evolve your business, processes and technology systems based on feedback obtained from your CRM. In the next section, we will look at the different types of CRM technologies that are available and examine how easy it is to adapt these as your business evolves.

To install good CRM into your business it is not just the case of buying and installing a CRM software. You will also need to evolve your business, processes and technology systems based on feedback obtained from your CRM.

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Types of CRM solution

As we have seen, data on your customers can help you evolve your business, processes and technology systems so that they are all aligned behind the core objective of better serving your customers.

As feedback comes in from your customers, those businesses which are able to respond fastest to their customers’ needs have a clear advantage. For example, if you find out that your customers don’t like your proposal process, but you cannot adjust this for several months, you will be losing potential revenue.

Technology has traditionally been a huge hurdle when making any adjustments to business processes. Therefore, it is paramount that you select the correct technology to develop your CRM.

Your goal is to select a CRM technology that

Is affordable and fast to get started with
Allows you to adapt fast – without high costs or any limitations
Is efficiently priced, not just in the short run, but also as you scale

When selecting a CRM technology you have four broad types to choose from: off the shelf CRM solutions, internally built custom CRM, outsourced solutions and no-code CRMs.

1. Off the shelf CRM solutions

There are several main brand companies in the market that provide off the shelf CRM solutions. Probably some of which you’re already familiar with. These solutions are generally low cost and fast to get started with and come pre-baked with features that can be toggled on or off depending on if you need them or not.

Whilst off the shelf CRM tools are quick and low cost to get started, there five main downsides to these solutions are that:

Low adoption rates. Low adoption rates are the number one problem with off the shelf CRM tools. Off the shelf CRM tools come bloated with lots of unnecessary features. Too many features creates confusion on how to use the CRM and creates low adoption rates which leads to missed revenue opportunities and invalid insights. Without your team using your CRM correctly, this means that you cannot trust the data inside your CRM to be an accurate reflection of your customers’ behavior.
Growing costs. The attractive entry price quickly ramps up as you increase your feature and data usage. This means, as the number of prospects, clients and internal users of your CRM increase, so does the price.
Lack of flexibility. There is also a trade off between pre-baked features and flexibility to adapt. You can only modify off the shelf CRM tools so far before they will no longer match your business needs.
Migration can be expensive. If you find that the CRM tool does not fit, then looking to migrate away from an off the shelf CRM solution to a custom built CRM can end up being more complex and expensive than anticipated. This is especially the case when it comes to migrating data sets that are stored inside the CRM.

2. Custom built CRM software - in house

For the ultimate, tailor made CRM solution, you can use internal teams of product designers and software developers to build you a custom CRM. A custom built CRM will do exactly what you want it to do and you can integrate your custom CRM with your internal systems exactly the way you need. Furthermore, it will cost you less to run the CRM as you scale, compared against an off the shelf CRM. Lastly, you have complete control and flexibility over your CRM system as your business evolves.

The downsides to building a custom CRM from scratch are that:

Large upfront investment. Building a custom CRM from scratch internally requires a larger upfront investment,
Finding the time. Allocating time for your internal team to develop the CRM solution is a challenge for most companies. This is especially the case since developers are in short supply.
Complex and risky. Careful planning is required to ensure that you’re building something in a sustainable way both from the point of view of making sure that your CRM is achieving what it needs to and second that the code for the system is being architected in a sensible way that will allow your CRM to scale.
Slow and expensive to adjust. After your development has been completed, it can be slow and expensive to adjust the functionality of the CRM using developers.

3. Custom built CRM software - outsourced

Application service providers can build you a custom CRM that is tailor made for your business. This approach is ideal if you want to implement a solution quickly and your company does not have the in-house development teams to do this.

When selecting an outsourced team to help build your CRM, it is a good idea to pick a team that already has experience building custom CRM solutions. This is because there are quite often nuances when architecting a custom CRM app that might not be all that obvious for first time development teams.

Note, Dittofi offers a free project consultation that can help you find a team that is experienced in CRM app development to help you build a custom CRM.

4. No-Code CRMs

Recently visual programming tools known as no-code technologies have become very popular for developing CRM applications. No-code tools allow users to build CRMs without needing to write code. They can significantly reduce the time, complexity and costs of building custom CRM solutions.

No-code solutions like Dittofi, for example, allow the option to start with a template of essential CRM functionality. You can then build on top of this functionality. For example, take Dittofi’s SalesFly template. This solution comes with essential CRM features such as:

Sign up, login and password reset functionality
Account management e.g. manage account name, passwords and user roles
Ability to manage Leads
Ability to convert Leads to Deals
Management of data in list and kanban views
Customizable pipeline (add stages to your deal management)
Store contacts, organised into People and Organisations
Detail views for Contacts, Deals, Leads, People and Organisations
Customizable roles, deal status, pipeline and pipeline status.

You can then take this CRM app template (and others), add to it, customize the template with 100% flexibility and save yourself months of development time and costs. In addition, Dittofi lets you export all the source code for the CRM app template for free. So you can have all of the code for a working CRM system in under a day and then customize and add to the essential features so that the CRM fits your business exactly.

There is literally no point spending time and money building the features above, such as login, sign up, password reset, manage account settings, etc. when Dittofi gives you them for free.

Check out our collection of full feature Dittofi CRM app templates

In addition to getting your going quickly, no-code tools like Dittofi allow you to adapt your CRM application without needing to touch any code. This makes it quick to adjust your CRM so that you can ensure that your CRM is always aligned with your business needs.

All that being said, traditional no-code solutions can have limits. This is because the majority of them will not give you access to your CRMs source code. Without access to your CRM code, as you grow there is a risk that ongoing hosting fees increase and any build limitations mean you need to re-build your custom CRM from scratch.

Dittofi’s no-code solution is unique since Dittofi is the only no-code tool that allows you to build apps visually, with 100% flexibility and also allows you to export and own your CRM apps source code without any additional charge. The source code you get on export is high quality, human readable and enterprise grade. With Dittofi, you get all the benefits of building a custom CRM app written by developers but, in the style of no-code, you can get it in a fraction of the time and at a fraction of the cost.

Conclusion

CRM is a business philosophy that requires a technological solution. Building a good CRM is iterative and therefore your choice of technology should empower you to make quick, cost effective adjustments whenever your business dictates.

Whilst off the shelf solutions are low cost to get started, the costs of these solutions ramp up as you scale up on features and data. Furthermore, off the shelf solutions have low adoption rates because they do not fit your business well. They come bloated with unnecessary and confusing features, are difficult (or impossible) to adapt and, when the time comes for you to migrate to a more custom CRM, this can be very expensive.

In contrast, custom built CRMs are expensive and difficult to develop. They can put a strain on your internal IT or, if outsourced, can be very costly and slow to adjust. The trade off here is that you will get a system that is tailored to your business, improves your chance of adoption by your sales and marketing teams and gives you pertinant insights.

Lastly, no-code technologies like Dittofi provide a solution that falls in the middle of both custom code and off the shelf solutions. However, traditional no-code technologies don’t support code ownership. This poses a risk. Dittofi is a no-code tool that solves this problem. The Dittofi solution strikes a delicate balance between code and no-code allowing you to build a CRM fast, customize it with 100% flexibility and allows ongoing, full feature code exports,. Through unlimited, full feature code exports Dittofi ensures that you are always in control of your apps source code and IP.

Dittofi also has a roster of third party technology consultants, Certified Dittofi Experts, that you can use to help advise and build your CRM system.

No-code technologies like Dittofi provide a solution that falls in the middle of both custom code and off the shelf solutions. However, traditional no-code technologies don’t support code ownership. This poses a risk. Dittofi is a no-code tool that solves this problem.

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