The operation of a CRM is very easy to understand. It consists of two clearly differentiated stages with different approaches. On the one hand, pre-sale, and on the other, post-sale.

But what is it like behind the scenes right now? Although there are different types of CRM systems , they all share a similar structure that is divided into three layers:

1. Data collection
2. Data management
3. Data analysis

CRM Definition: What is it?

When we talk about how a CRM works , we must first know that we are referring to a specialized tool that allows the collaboration of Sales, Marketing and Customer Service in the management of contact points with customers. 

Why is this tool so important? This new era of information technology has changed the way we consume, directly impacting the way we conceive relationships between customers and companies. And an essential factor in this is data. 

How does a CRM work?

Before we break down the layers of customer relationship management , let's explain how CRM works in practice and how it carries out customer management . This way, it will be easier for you to place these stages in a practical framework.

Before the sale

The CRM cycle begins before any sale is made. The system is responsible for tracking and identifying user interactions across various platforms, such as social media, emails, or website visits. This initial process helps build a solid base of potential customers.

One of the core functions of CRM is to organize and store this information, allowing sales teams to work strategically. For example, the software not only saves customer data, but also offers reminders about when to make important follow-ups or calls. This ability to automate critical tasks makes the sales process more efficient and personalized.

During the sale

At this stage, how a CRM works becomes more apparent. The system provides a detailed history of all previous interactions with each customer. This allows sales agents to personalize their messages and pick up conversations without losing context. Additionally, it makes it easier to manage appointments, proposals, and negotiations, ensuring that no detail is overlooked.

After the sale

Once the sale is made, CRM shifts its focus to loyalty. This is where another of CRM's core functions becomes relevant: ongoing follow-up. The system not only records previous purchases, but also identifies opportunities to offer discounts, complementary products or after-sales services.

If any issues arise, CRM allows you to record and monitor problem resolution, improving the customer experience. This continuous cycle of communication and support is critical to maintaining long-lasting relationships.

Structural layers: How does a CRM work from within?

To delve deeper into how a CRM works , it is important to understand its structural layers.

1. Data collection

The first step to understanding how a CRM works is to analyze the data collection layer. This phase is the foundation of the system, as it is responsible for capturing all relevant customer information.

At this stage, companies are using tools that allow them to record key interactions across channels like Facebook, Twitter, and Instagram. Some CRM systems, like Salesforce or HubSpot, offer native integrations with social networks, while others require external plugins like Zapier to connect.

It’s crucial to ensure that your CRM is compatible with the platforms you use. This not only makes data capture easier, but also ensures a smooth transition to the next stages of the process.

2. Data management

The next layer in the functioning of a CRM is data management. Once the “raw material” has been collected, the system organizes and assigns this information to the appropriate departments: sales, marketing, support or loyalty. Here, how a CRM works becomes evident by automating tasks that previously required manual processes.

For example, a lead’s data can be automatically assigned to a sales representative, while existing customers with support issues are routed to the customer service team. This precise assignment ensures that each interaction is handled by the right staff, optimizing resource use and improving customer experience.

3. Data analysis

The third layer is perhaps the most powerful in understanding how a CRM works . At this stage, the system uses analytical tools to process the data collected and managed in the previous phases.

Through customized dashboards and reports, CRM allows you to view key metrics such as team performance, customer satisfaction, and the effectiveness of marketing campaigns. This constant analysis helps identify behavioral patterns and opportunities for improvement, turning data into actionable insights.

For example, a detailed analysis might reveal that a specific marketing channel, such as email, drives more conversions than social media. With this information, you can redirect efforts and resources to maximize results.

CRM Functions 

To truly understand how a CRM works , it is crucial to explore the features it offers. These tools are designed to facilitate interaction with customers at every stage of the process, from acquisition to loyalty.

Below we break down the main basic functions of CRM.

1 | CRM Features: Contact Management

Contact management is one of the most essential CRM functions. This is where the system shows how a CRM works by organizing customer and lead data in one place. This allows sales and marketing teams to easily access key information, improving efficiency and personalization.

• Customer Prospecting: Identify and classify users with the greatest potential to become customers.
• Smart Lists: Automatically filter and segment your database, providing quick access to specific groups without repetitive manual steps.

In short, how a CRM works in contact management is by ensuring that each potential client receives the right attention at the right time.

2 | CRM Functions: Marketing

Although commonly associated with sales, CRM functions are also critical to marketing strategies. Understanding how CRM works in this area involves recognizing its ability to automate and optimize campaigns.

• Creation of Call to Action (CTA) Strategies: Facilitates the implementation of personalized CTAs and their analysis to measure their impact.
• Smart Content: Automatically personalize content for each customer based on their interests and behaviors.
• Digital Marketing Campaigns: Allows you to design and execute social media campaigns directly from the CRM.
• A/B Testing: Compare the performance of different versions of a campaign to identify the most effective one.
• Automated Email Marketing: Automate the sending of emails, optimizing time and ensuring constant communication.

These features highlight how a CRM works by integrating and enhancing marketing campaigns, allowing businesses to effectively attract and retain customers.

3 | CRM Functions: Sales

In sales, how a CRM works is reflected in its ability to optimize every interaction with leads and close deals more efficiently.

• Sales Tracking: Visualize which stage of the sales funnel each customer is in, facilitating a strategic approach.
• Sales Goals: Set and communicate clear goals for the sales team, improving alignment and productivity.
• Sales Visit Agenda: Organize meetings and visits, ensuring a professional and well-planned impression.
• Automated Quotes and Budgets: Generate customized quotes automatically, saving time and reducing errors.
• Updated Product Catalog: Allows sales teams to quickly access detailed information about products or services.

This is how a CRM works in sales: by providing the tools necessary to close deals faster and more effectively.

4 | CRM Functions: Document Management and Communication

Fluid internal communication is key in any company, and a well-implemented CRM makes it much easier. This is where we can see another facet of how a CRM works :

• Email Sequence Templates: Schedule automated emails based on customer actions, ensuring timely communication.
• Centralized Internal Communication: Many CRMs offer internal chats, improving collaboration without the need for external tools.
• Workflow Diagramming: Create standardized steps to guide teams through recurring tasks, ensuring consistency in operation.

These features highlight how a CRM works by centralizing information and fostering collaboration within the organization.

5 | CRM Functions: Report Management

Finally, data analysis is one of the most valuable core functions of a CRM . Thanks to the reports generated, you can constantly evaluate performance and adjust strategies in real time.

• Digital Marketing Metrics: Evaluate the effectiveness of your campaigns and optimize your efforts.
• CRM Metrics: Measure your teams' performance and the overall health of your customer relationships.
• Customer Satisfaction Indicators: Obtain valuable information about your customers' perception and level of satisfaction.

This is what you need to know if you want to take advantage of the basic functions of CRM

To get the most out of basic CRM features , it's essential to understand how a CRM works at its most fundamental level.

Organizing contacts and centralizing data

We already know that one of the pillars of how a CRM works is the ability to centralize all customer information in one place. From contact details to interaction history, everything is recorded for quick and easy access.

The most important tip I can give you here is to keep the database always up to date and make sure that all team members enter information in a uniform manner. This will ensure that the system works optimally.

Activity Tracking and Task Automation

Another example of how a CRM works is its ability to automate routine tasks, such as call reminders, follow-ups, or sending emails. These automations ensure that no opportunity is missed through carelessness.

Key Tip: Set up automated workflows that trigger based on customer actions, optimizing your time and resources.

Sales Funnel Management

CRM also helps you visualize and manage your sales funnel. Knowing how CRM works in this area will allow you to identify what stage each customer is in and what actions to take to move them toward conversion.

Key Tip: Regularly review your funnel to identify potential blockages and adjust your strategies.

Email Marketing Automation

A CRM makes it easy to create and send automated, personalized emails. This is a crucial aspect of how a CRM works, as it allows you to maintain constant communication with your customers without excessive manual effort.

Key Tip: Use segmentation features to send targeted messages that increase the relevance and effectiveness of your campaigns.

Reporting and Metric Analysis

Finally, one of the most useful aspects of how a CRM works is its ability to generate detailed reports. These help you measure the effectiveness of your sales, marketing, and customer service efforts.

Key Tip: Regularly analyze reports to gain insights that can help you improve your strategies and make data-driven decisions.

Understanding how a CRM works is just the first step. What's really important is identifying the key features it should have and learning how to take advantage of them. If you need this software, you can compare the features and benefits of the best CRMs on our software comparison platform, where you can also receive free advice !