I was in a training recently, and the trainer used the phrase “CRM software” and “email list service” interchangeably. Aside from being imprecise, I thought that mixing these two terms could easily lead someone to that dreadful practice of adding people to their newsletter list without consent, although the trainer clearly was against this idea.
The phrase CRM (Customer Relationship Management) refers to what your company does to manage and strengthen relationships with customers and potential customers. There may be multiple parts to your system and practices such as coupons, rewards, customer-only events, software designed to help you stay on top of things and yes, an email newsletter may be part of that system.
Sales and Networking Expert Don Talbert defines CRM as “A comprehensive system which enables the small business owner to truly manage his or her client database. Used properly, a CRM system can help generate more revenue. One can utilize the CRM system to contact clients on important dates, stay in touch on a regular basis, etc. ACT and Salesforce are two very popular CRM software programs.”
CRM software does a variety of things including keeping track of past conversations with prospects, cuing you to follow up again, tracking their buying habits, testing various practices and generating data about your customers. Since this is for internal company use, it’s usually a good idea to make sure all customers and potential customers are entered into the system.
Your email list service (e.g. Aweber (affiliate link), Mail Chimp, Constant Contact, etc) is much more narrow in scope. It facilitates communicating with people via mass email. The service should take new sign-ups, handle people leaving, let you send emails and provide you with data. One of the more important functions is to help you to stay compliant with spam laws. One big difference between CRM software and an email list service is that only people who have expressively given permission should ever be entered into your email list service. To add people without their consent is a violation of spam laws, annoys people and makes you look bad.
Sales and Networking Expert Don Talbert had this comment about the difference between CRM software and Email List services:
“Email distribution is only one facet of CRM, and is not interchangeable with it. It is simply a medium for communicating with others. Email is integral to CRM however should never be mistaken for being the same thing.”
As you can see, these 3 things – your company’s CRM practices, CRM software and email list service – are all different things that serve different but related purposes. The purpose of this article is not to be a stickler for word usage, but to point out that if you don’t understand the difference between these things you could end up hurting your business.