What is CRM used for?

What is CRM And what is a CRM system?

CRM definition

CRM is the abbreviation of the English Customer Relationship Management (Customer relationship management or the Maintenance of customer relationships). By aligning internal company processes and with the help of special software (CRM systems), the acquisition of new customers and the care of existing customers are to be promoted. So it's about systematically building customer relationships and maintaining them in the long term.

What is a CRM System?

The software for managing customer relationships is called a CRM system. This includes purely administrative activities such as storing addresses or contact details, but goes far beyond that, depending on the software. Typical functions of a CRM system are for example:

  • Maintenance of master data (names, addresses, contact details)
  • Storage of contact history (emails, phone notes)
  • Customer selection (filtering according to criteria such as sales, region, industry)
  • Document management
  • Task management and project management
  • Calendar and appointment management

By using a CRM system, customers should be looked after as specifically and comprehensively as possible in order to create long-term and profitable business relationships

The constant acquisition of new customers is much more expensive than persuading regular customers to buy again. A high level of customer loyalty, however, presupposes that a company can still understand how it relates to individual customers, even years later. For example, was it a one-off purchase or a regular customer, was it a small product or a large project? Who were the contact persons on the customer side? In order to be able to understand what type of customer it is, what has been agreed with him and who has maintained contact in the past, systematic documentation is required - a CRM system.


Would a CRM system make sense for your company?


Different CRM approaches

Within Customer Relationship Management there are different focal points and philosophies, which often result from the size of the company and its business model. On the one hand, they are reflected in the customer's view, but above all in the design and conception of the CRM system:

Operational CRM

Operational CRM forms the basis for everyday communication with customers. This particularly applies to the areas of sales, marketing and support. Specifically, this is about maintaining customer history, keeping address data up-to-date and addressing customers with the right topics at the right time. In particular, small companies and service providers in B2B business should clearly focus on operational work when choosing a CRM system, because this is where they often have the most deficits and at the same time the greatest leverage. Personal contact is the most important asset in CRM for SMEs (small and medium-sized companies). This not only leads to higher customer satisfaction and a more stable customer relationship, but also to long-term customer loyalty and thus also has a direct influence on sales.

Collaborative CRM

Collaborative CRM describes the collaborative work among CRM users, because good CRM is teamwork. The CRM system used should also support this. In practice, collaboration in the CRM system means, for example, that all users access the same data. Regardless of whether it is the sales representative at the customer's site or the support in the office, everyone can look after the individual customer individually, even if the colleague has recently changed data. In addition, a collaborative CRM enables users to work together on projects or data sets, even if they are not in the same place. This also means that they are notified by the CRM system when colleagues add something or that other users can comment on entries. Communication within the CRM system not only increases transparency for all team members, it also prevents many unnecessary e-mails and meetings.

Analytical CRM

Analytical CRM is the attempt to control sales and marketing with a CRM system using key figures. The need for analytics in CRM increases with the size of the company and the number of customers. Customers are listed more as numbers than as specific persons and are statistically evaluated the more customers a company has. A group will not look after each individual customer personally, but rather a few major customers (keyword key accounting). The same applies to providers of consumer goods or products in the lower price segment. Nobody can build a personal relationship with the thousands of customers who order a T-shirt in the web shop. The only thing that counts here is scaling, i.e. using KPIs (Key Performance Indicators) to optimize the conversion of unqualified addresses to interested parties and then to paying customers. However, this very analytical mindset also brings with it some problems. On the one hand, analytical CRM systems leave the user very little leeway when it comes to individual customer care. On the other hand, analytical CRM systems require a lot of data, because only where a lot of data is available can it be analyzed. This often leads to the fact that the users of a CRM database spend most of their time collecting and maintaining various data, which means that the actual customer care service suffers.

The right CRM system for SMEs

Before introducing a CRM system, you should carefully consider what focus CRM should have. In addition to the corporate philosophy, this decision also depends heavily on the size of the company. For small and medium-sized enterprises (SMEs), for example, analytical CRM systems simply mean additional expenditure of time, as they will never or never want to use their functions. Small companies in particular should therefore initially consider the operational advantages of their CRM solution instead of looking at the largest possible number of evaluations and reports. CRM is primarily operational and collaborative in SMEs, which means that it should support the employees in sales in their daily work and promote communication in the team. Small companies usually have the greatest leverage here, which means that very effective results can be achieved with small measures.

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Technical background of CRM systems

Without going too deep into technical details, CRM systems are essentially used in three different ways. Locally, i.e. only on your own PC, on your own server in the company or data center (on premise) or as a cloud solution (SaaS). In the latter case, the CRM provider operates the software on its own servers and users can access their data via the Internet. The type of CRM installation has different advantages and disadvantages, depending on the planned use.

Advantages and disadvantages of different CRM systems

Local installation Client-Server / On PremiseCloud-based / SaaS
+ Full data sovereignty+ Data sovereignty in the company, if applicable+ Fast setup
+ Relatively inexpensive+ Can be used on various devices, including mobile+ No initial investment
- Can only be used on the respective PC, not mobile + Many adaptations and connections possible, depending on the system+ Geared towards quick and flexible use
- No team work with colleagues+ Comprehensive open source solutions available+ Little technical know-how required
- Independent protection against hackers required- Requires either internal IT infrastructure or service providers+ Mobile, location and device-independent usable (web browser is sufficient)
- Responsible for backups- Technical know-how required- Data sovereignty not in-house
- Hardly any help in support cases- Usually only profitable with a higher number of employees- Online connection required
- More elaborate setup with initial investment
For: Tech-savvy individual and occasional users For: Companies with more than 50 users and, at best, competent IT staff For: Small and medium-sized enterprises (SMEs), self-employed and startups

Just as important as the decision of whether to use a CRM system with an operational, collaborative or analytical focus is the decision on the technical basis of a CRM. A small company without proven IT competence in-house, for example, should better rely on a SaaS solution. Then the CRM provider is responsible for updates and the secure provision of the software and not the company itself.

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Background and history of CRM

CRM is associated with far more analytics today than it was a few years ago. This is certainly due to a greater wealth of data (companies can now track users and their user behavior across the network), but that's not all.

In order to understand why CRM is the way it is today, it helps to look at the historical development and to understand the basic idea. We think that many salespeople, and with them their CRM system, have strayed a long way from the original CRM concept.

In the beginning there was a direct relationship with the customer. In the corner shop, for example, you knew your customers personally and also knew what they would buy. Due to mass products and the enormous growth of many companies, the treatment and contact with customers became more and more impersonal. Companies had alienated themselves from their customers or were well on their way to doing so. The customer service developed into mass processing and the customers felt that too. The result was low customer satisfaction and loyalty. Customers switched providers at the first opportunity. To get this problem under control, the new and holistic CRM concept was launched. This was accompanied by concepts such as key accounting, the "one-contact" philosophy, regardless of the problem. The customer should be treated as well as possible and at the same time personally, i.e. get the service he needs without any problems, even if this means additional work for the company in charge.

Negative effects of too many key figures in CRM

In the 2000s, however, the pursuit of efficiency, productivity and more performance came back on the screen. Variable remuneration, stronger controlling and tracking of customers across different channels were introduced in order to get more out of customers. It wasn't about the individual customer, because the respective sales employee or key account manager already knew them very well. It was about creating customer groups and automating as much as possible in dealing with customers. This is basically okay, but thinking about efficiency and key figures led to CRM systems that leave the user hardly any leeway for individual support. In addition, he is so busy entering basic data about his customers that customer care suffers. Key performance indicators (KPIs) were transferred to so-called “balanced scorecards” and “dashboards” in order to control their own sales with a kind of bird's eye view. And if the management wants to collect a lot of key figures, the sales department has to collect and enter a lot of data. Even if that means less time that can be used for the customer.

Advantages and goals of CRM - more than address management

Let's start at the very beginning of the sales process: With a good CRM you can serve your potential customers better and more individually. From the second contact onwards, customers will notice that you value the customer relationship, simply because you still know what was agreed, when and with whom.

Once you have won over the customer, a good CRM system will help you increase customer satisfaction. By reacting competently and well prepared as a provider even in the event of a problem or a query, you leave a lasting impression. It is obvious that higher customer satisfaction also has an impact on the rate of repeat customers. This is how you manage to build a long-term customer relationship and win the customer's loyalty.

These loyal customers in turn help you to make savings in marketing, because loyal existing customers usually ensure good recommendation rates. They tell their friends and business partners about their positive experiences and recommend them to others.

In the end, your CRM system will help you grow sales and earnings. Holistic customer relationship management certainly has a positive effect on the company's success - in the long term. As you can see, you don't need a complex controlling and performance indicator system to drive up profits and revenues. Extensive controlling eats up time and nerves for everyone involved - the results and actions that you draw from the collection of all your data first have to be translated into effective measures and implemented. That is, before any positive consequences can be expected, you must first recover the loss of productivity. In most cases, and especially in the case of SMEs, this does not take place from our experience, but ends in a “you have to”. However, when everyone in a company focuses on the customer and their needs, success comes almost by itself. So it is best to use a simple and understandable CRM system that primarily helps the users of the system and your customers' interlocutors. The rest will then come naturally.

CRM thus follows the same principles as Partner Relationship Management (PRM) and Supplier Relationship Management (SRM): It is about the management of relationships, on the one hand with customers, on the other with partner companies (PRM) and with suppliers ( SRM). In any case, the professional management of these relationships ensures more sales and thus greater corporate success.

CRM from the customer's point of view

From the customer's point of view, a good and functioning CRM leads above all to one better, more personal service. His concern is placed in a context and therefore better understood. The customer does not always have to start with Adam and Eve, but his counterpart knows the course and the individual previous history directly.

There are no queues for queries from colleagues or the search for documents. Are in a good CRM system all relevant information is stored in a central locationso that the individual user has everything to get an idea of ​​the situation. Above all, this saves time and nerves on the part of the customer.

CentralStationCRM: The simple CRM system for small businesses

Our CRM system CentralStationCRM differs greatly from other CRM systems in terms of functionality and orientation. As a user, you benefit from selected features and a simple interface, instead of constantly having to face a multitude of functions that you would rarely use anyway. Instead of control functions to manage a huge sales team, we rely on collaboration, transparency and collaboration within your team. If you maintain lively contact with your customers and do not see CRM as a one-way street communication, then CentralStationCRM is the right CRM system for you.

Manage contacts, tasks, offers and much more

CentralStationCRM helps you organize and maintain your contacts. In addition to master and address data, the CRM system has space for your e-mails, internal notes and all tasks in your team. The slim interface makes your everyday life easier, both when acquiring new customers and when looking after existing customers. The structured and central storage of your customer data saves you an enormous amount of time that you would otherwise have to spend on inquiries and research. You can add keywords to your contacts so that you can easily filter them according to your own criteria. It works in a similar way with the offers and sales, which you get grouped together with just a few clicks.

One CRM system for all operating systems and devices

A CRM system not only has to be properly maintained, it also has to be available at all times.CentralStationCRM is completely web-based, which means that it does not matter whether you access your data from the office, from your desk at home or from your mobile phone, it is always up-to-date. This also means that each of your colleagues has real-time access to the same information as you. The same applies of course to the operating system or e-mail program. It doesn't matter whether you work on a PC or a Mac and send your e-mails with Outlook or Gmail. All you need to use CentralStationCRM is a web browser and an internet connection. It couldn't be easier or more convenient.

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This is what our customers say about CentralStationCRM

  • "If you don't understand CRM software within half an hour, then it's too complicated. CentralStationCRM does just that!"

    Florian Lewerken, Kiebitzberg Group · Family company in shipbuilding

  • "We are happy to have found a simple and uncomplicated CRM with CentralStationCRM that exactly meets our requirements. The fast and personal contact with the team in particular is probably unique among software manufacturers."

    Michael Schmid, RTA Design · advertising agency

  • "The best thing about CentralStationCRM is that the user does not have to be persuaded to use it. He uses it by himself because it is so simple and yet comprehensive."

    Dirk Haverkemper, PI Company · Online assessments for companies

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