The full history of CRM goes back much further than you might imagine.
In fact, the first customer relationship management tools were invented in the 1950s.
Since then, the industry has come a long way, and CRM solutions serve large and small businesses alike.
1950s: Invention of Rolodex
The first customer relationship management systems filed customer information so companies could organize the data.
Rolodex is a rotary filing tool invented by Danish engineer Hilder Nielsson in 1956.
Rolodex stores indexes and business card collections in alphabetical order, allowing users to rotate and flip through the letters until they find the contact they need.
Before Rolodex, contacting customers was unnecessarily difficult because their information was disorganized.
1960s: Mainframe Systems
The history of CRM follows mainframe systems that became available to businesses in the 1960s.
Mainframe computers were invented earlier (in the 1940s and 1950s), but they became available to businesses much later.
Mainframe systems are large, bulky computer systems used by businesses to store and process customer data, including:
- contact details
Digitizing customer information was a forward thinking idea at the time, but mainframe systems took up a significant amount of space, often an entire room.
So if you were running a small business in the 1960s, probably We weren’t using a mainframe system to organize our customer data.
1980s: Database Marketing and Contact Management Software
The history of CRM changed dramatically in the 1980s as companies took advantage of technological advances. That said, companies have started to leverage customer information gathered through database marketing.
Database marketing is easy.
Businesses contact existing customers in their database to offer products and services.
Typically, companies used the postal system to send product catalogs and encourage customers to purchase their products.
Towards the end of the 1980s, companies began selling products and services by calling customers directly. Also, as computers became more prevalent, filing customer data became easier.
1990s: Sales Force Automation and Mobile CRM SaaS
Sales automation was invented quickly after the first contact management software in CRM history.
In 1993, Tom Siebel founded Siebel Systems to provide sales automation tools.
Tom Siebel then expanded Siebel Systems to develop a marketing automation and customer service application called Siebel Sales Handheld.
After Siebel Sales Handheld, Siebel Systems quickly became the market leader in sales force automation.
This technology makes it easier for sales teams to work and sell from anywhere without being tied to a desk.
2000s: Cloud-Based CRM and Social CRM
The history of CRM in the 2000s saw the emergence of the first cloud-based CRM software and the power of social media.
Cloud-based CRM systems allow businesses to access sales and customer data from any connected device.
By 2004, a group of engineers had introduced the first publicly available Internet-based software to the CRM market called Sugar Open Source.
By the late 2000s, businesses began using social media platforms to improve customer relationships.
As a result, social media sites such as Facebook and Twitter have made customer relationship management more interactive rather than transactional.
Social media has dramatically changed the way sales processes and businesses improve their customer experience.
For example, social media allows businesses to collect more customer information and analyze which marketing techniques are most effective through engagement statistics.
2010s: The Rise of CRM Providers (Modern CRM)
The 2010s saw a rapid expansion of the CRM market with the entry of numerous CRM providers.
CRM systems have advanced as technology has become more mobile, allowing companies to access data from mobile phones and tablets as well as desktops.
As technology advanced, CRM providers began offering their own software specialized to meet specific business needs and industries, such as:
- Social media
- real estate
Instead of treating all CRM needs the same way, providers have created unique sales tools to improve customer interactions based on industry.
This discrete approach to CRM has allowed more companies to leverage the technology and implement it faster.
2020s: Further sophistication of CRM
Businesses continue to evolve their customer relationship management software every year.
CRM users today enjoy a number of advancements, including:
- automatic contact tracking
- marketing automation
- Report function
- data intelligence
- Advanced analytics
The data that CRM systems collect is so detailed and accurate that businesses can make more data-driven decisions that lead to more sales.
The CRM market is looking to offer more all-in-one products to reduce the need for multiple third-party integrations.
The future: AI and CRM
In the future of CRM, more artificial intelligence will be implemented (most programs have already started using this technology).
Artificial intelligence offers business owners more automation, allowing them to focus on other projects instead of repetitive tasks.
As a result, artificial intelligence helps with marketing campaigns, organizing customer information, and communication tasks.
Some common AI systems in use today generate textual and visual content.
But in the future, AI experts aim to make the technology more sophisticated and enable additional business operations.