CRM software made up almost a quarter of the global revenue for worldwide enterprise application software revenue (more than £158.74 billion) last year. According to Gartner, CRM software adoption grew 15.6% in 2018 and it has been growing steadily in the past years. 

In the UK, 96% of businesses are micro-businesses(fewer than 10 employees). The number of companies adopting software is increasing in the UK, however, there is still a large number of SMEs that don’t see the value in investing in CRM software. Software not only optimises and automates processes, but also reduces errors. Furthermore, future processes can be improved through reports and data analysis. 

Customer orientation is a key factor in the success of any business. Dealing with inquiries and complaints in a fast manner increases customer satisfaction and customer retention. As a result of digitisation, customers and the channels by which these can access companies are changing – and companies need to adapt to this to stay competitive. As Melissa A. Hilbert, research director at Gartner states: “Sales leaders must understand the risks and benefits of technology as they seek to increase productivity.”

W e conducted a survey amongst British SMEs to understand how they are using CRM software. 

Highlights of the study

  • 31% of small businesses in the education, financial and IT sectors in the UK have CRM software in place.
  • 69% of small businesses in the education, financial and IT sectors are not using CRM software to manage their customer relationships.
  • 34% are not looking to implement CRM software. 

Only a third of SMEs businesses in the UK are using CRM software

The results of the survey show that SMEs are not investing in CRM software, with over 69% of them not having any tool in place and only 31% having one system in place.

We wanted to know how British SMEs are managing their contacts and customers. The results of the study revealed that, almost two thirds of British SMEs are not using CRM software at present. But how are they managing to keep up with their customers?

The spreadsheet is still the most used tool by SMEs to record customer data

A third of respondents (32%) use spreadsheets (like Excel or Google Sheets) to track information on their customers. Other methods alternative to CRM software include manual methods such as pen and paper (15%), email based communications such as Gmail or Outlook (20%), and email marketing software (3%). Seven percent reported using other methods.

Businesses struggle with data accuracy

Most SMEs don’t see the value in investing in software and rely on other methods that are cheaper. However, as the business grows and the number of clients increases, it’s likely that the need for a unified location for your data will arise. Respondents cited data accuracy (25%), lead (19%) and customer (15%) interaction management as the three biggest challenges they face when managing customers. 

Other factors that are challenging for SMEs include difficulty when looking to schedule follow-up interactions with leads (15%), sending marketing materials is time consuming (13%), the lack of visibility of when customers make a payment (7%) and lack of visibility when the company makes a payment (4%).

CRM software helps companies to better understand their customers

The survey results also showed that those companies that have CRM software implemented believe that the tool helps them to better understand their customers. One of the main advantages is that increases visibility, which in turn, leads to increased collaboration and better results. Almost half of respondents (47%) said that CRM applications help somewhat well to understand their customers and 28% said that CRM tools help them to understand their clients very well.

Only 4% stated extremely well. Another 11% stated that CRM didn’t make much difference when helping understanding their customers and for a 10% of respondents the software didn’t make a difference at all. 

Almost a quarter of businesses are willing to invest in CRM software

Despite this, there is a third of businesses that are not looking to implement the software (34%). But not all is bad news: It’s important to note that 23% of respondents would be willing to invest in CRM software. 

Cost is still a barrier to adoption

Over a third of respondents (33%) would be willing to invest less than £10 per user per month on CRM software. Another 33% would only consider spending up to £50 and another 24% would only consider free CRM software. On the other side, 4% would be willing to spend over £50 up to £100 and only 6% would spend over £100.

Some vendors offer a trial, so if you are unsure you can try it first. If you want to learn what available options are currently in the market, visit our Customer Relationship Management (CRM) software listing. 

Methodology of the study

To collect the data for this report, we conducted an online survey. The answers come from a sample of the target market UK. The results are representative of this survey, but not necessarily for the population as a whole. The survey was completed by 299 participants who qualified to complete the survey through screening questions out of a total of 343 participants in July 2019. Qualified participants are employed (full-time, part-time or self-employed) and work in a small to medium sized enterprise (1-250 employees).