A big part of my business is setting up CRMs. So I thought I'd take a few moments to explain exactly what that's all about.

The letters CRM stand for "Customer Relationship Management" and a CRM is often called a CRM System or a CRM Database - because it's there to help you manage the relationship with your customers. (Unsurprisingly).

But, actually, CRMs are often misnamed. A lot of people don't really use them to manage their relationships with customers, they use them to manage their relationships with their prospects.

So what does it mean to manage these relationships? At its simplest, a CRM is just an address book - here's who you know (either customers or prospects) and here's how to get in touch with them. But a proper CRM is more than that. It's also a log, a journal. Of all your communications with those prospects and customers. So anyone in your team can see, at a glance, what's been going on with that person.

Take action Where do you store information about your customers? What about your prospects?