What is the Difference Between a CRM and Marketing Automation?
When you step into the world of marketing and sales, two phrases you will hear a lot are CRM and marketing automation. They can often be used within the same sentence, but they are not synonymous with one another.
A CRM, which stands for customer relationship management/manager, does exactly that – it manages your customer relationships by organizing your contacts (by company name, job title, potential deal size, etc.) and the interactions your company has with those contacts.
A marketing automation solution specializes in communicating with those contacts based off of many different factors that may are may not be tracked within the CRM. The goal is to educate or nurture those contacts until they are ready to buy. Or, if the contact has already made a purchase, marketing automation can help continue that relationship to encourage renewals or repeat business.
What is the difference between a CRM and marketing automation?
CRMs manage your company’s interactions with current and prospective customers, while marketing automation helps create, automate, and distribute those interactions. Marketing automation can also measure the effectiveness of those efforts, so that companies can minimize “wheel-spinning” and really focus on what works for their specific business.
If you are familiar with marketing and sales terms, you may have heard some (or many) references to “the sales funnel.” At the top of the funnel, you’ve got a large group of people who may or may not be interested in the products or services your company has to offer. As the funnel narrows, uninterested leads are filtered out, leaving Sales Qualified Leads (SQLs) at the bottom – those that are ready to buy.
Marketing automation helps track prospect activity closer to the top of the funnel (but not the very top, as is commonly misconceived!), while CRMs are used to track interactions closer to the bottom of that funnel.
It’s important to note that marketing automation is not for the tip top of the funnel. It should not be used to “spray and pray” or “batch and blast” marketing material. Doing this will result in being flagged a spammer. Marketing automation should focus on prospects that are interested enough in your product or solution to be on your website, reading your educational content, and actively reaching out to learn more. They provide their email address to you.
Another common misconception is that sales teams and marketing teams are communicating to different audiences. This can be a dangerous and divisive way to think. In reality, marketing and sales teams should be working side-by-side to generate revenue. Marketing teams build brand awareness, educate and nurture prospects until they are ready to buy. Then, those prospects are handed of to the sales team as Sales Qualified Leads (SQLs), however the communication and nurturing should NOT stop here (and neither does the involvement of marketing automation!). It only needs to shift gears. Once a prospect has become a customer, the education and nurturing should shift gears again – but never cease.
If you are interested in learning more about how a CRM and marketing automation interact, request a free demonstration with an expert today!