Managing customer relationships can be a daunting task but also a very rewarding one. Luckily, there's business software that will help you. Here's how to select the right customer relationship management software for your business.

When your list of contacts has outgrown your Rolodex and you begin to forget important client details, it may be time to implement Customer Relationship Management (CRM) software into your business operations. From  basic contact management software to tracking and managing sales orTweets on Twitter, CRMs offer many levels of organization to deepen customer relationships. The ROI may not only result in increasing sales, but should also yeild better customer service. This guide will help you determine your customer relationship needs, which will help you in your selection of CRM software.

How to Choose CRM Software: Why Invest in a CRM?

The term CRM describes methodologies, software, and often, Internet capabilities designed help businesses manage customer relationships in an organized fashion. While CRMs have traditionally been seen as an automated way to track and maintain client contact data, today's CRMs are smarter, faster, and highlight the most up-to-date computing technologies available. From there the CRM can be the tool you use to set and measure sales goals, devise, deliver and track e-mail marketing campaigns up through and including interfacing with your social media accounts. CRMs' importance in the marketplace has also grown. By having everyone –sales, marketing, and customer service– on the same page the company becomes more efficient (and hopefully more profitable) by matching customer needs with company offerings.

"As a small business, often you have people working across all three of those channels. CRM systems become that single version of the truth –you know who your customers are, what products and services they bought from you, and what products and services they might be interested in going forward," notes Sean Whiteley, vice president of product marketing for Salesforce.com, a San Francisco, California-based CRM provider.

Beyond managing customer relationships, Raju Vegesna, executive evangelist for Zoho, a Pleasanton, California-based online CRM company, said that if a small business owner needs to keep track of other pieces of customer information such as contracts, invoices, and e-mails, for example, then, "A CRM system comes in handy in such situations as it helps you aggregate all customer related information in a single place."

Additionally, Vegesna pointed out if small business owners frequently personalize and e-mail customers manually, or they have no idea of the status of each customer in the pipeline, then that's another sign they'll need a CRM system. 
Essentially, said Barton Goldenberg, CEO of ISM, a Bethesda, Maryland-based CRM strategic advisory company, CRMs offer "busiess functionality at your fingertips that will save a ton of time for front-line personnel."

Although there are many reasons to invest in a CRM, there are potential obstacles to successful usage. One of the most important factors on the road to success is employee buy-in. "Fifty percent of the initiative is people," said Goldenberg. There has to be "a willingness and commitment of a company to be structured in your sales, marketing, and customer service approach," before implementing a CRM.

Short of the threat of job loss, to encourage employee buy-in, Goldenberg suggested a top-down approach whereby management sets the example in using the tool. Also, he suggested creating a "CRM Champion," someone who is the go-to employee (not the boss) who really understands the system. Further, Goldenberg suggested offering rewards and incentives to help employees overcome the fear and concern of learning the new system.
Among other roadblocks to CRM success, the next major challenge is the cost. Goldenberg said it can cost anywhere from $500 to $2000 per user per year to implement a CRM. "The CEO needs to understand the cost of CRM goes beyond simple licensing, rather it encompass the license, training, and whatever business process changes they need to make.

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