Excel vs. CRM: Which is the best data tool for your business?
It seems like an obvious question, and many people may assume that this question only affects small businesses. In reality, this is not the case; it is shocking how many medium-sized companies use Excel in their daily management.
Why? The reasons vary:
- The system is outdated
- The system is very rigid
- It takes a long time to keep it updated
- It was not adopted by the staff as they expected
- They are developing a new business unit that does not yet have an assigned budget.
It's also true that when it comes to managing customer data, people often still default to Excel. It's simple, familiar, and sometimes sufficient for most small businesses. But if you're in a hurry to get your team up and running quickly, or if you want to scale your business over time, you need a database application, in this case a CRM (Customer Relationship Management).
While Excel is great at what it does - it's able to store large amounts of data in an easily accessible format - it doesn't provide the kind of power that businesses with large volumes of data need. Even if your original needs aren't very complex, as your business grows, you may find that you outgrow Excel when it comes to storing information. You'll be held back by the fact that Excel can only handle one task at a time, unlike a database's ability to handle multiple tasks at once. You'll also struggle with the amount of space available on a mobile phone or tablet when using Excel.
What is a CRM?
A CRM is a tool for tracking and managing customer interactions, for controlling the customer journey and lifecycle. It helps you connect with customers, nurture them throughout the buying cycle, increase their lifetime value, reduce ineffective channels and nurture potential customers.
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Below we will tell you the main differences between spreadsheets and CRM databases so you can decide which one is most suitable for your company.
CRM databases are powerful
When it comes to data management, the reason businesses choose Excel is because it’s a familiar tool. The average office worker is more comfortable with Microsoft Office than they are with CRM databases. And unfortunately, many businesses don’t want to spend the time or money learning new skills , so they stick with what they know and understand.
While Excel can be effective for smaller businesses, it becomes unmanageable as soon as a business starts to grow. It also has limitations when you need to share data between employees in different locations, which is why many Fortune 500 companies use relational databases that allow them to store and manage data in one central location.
A CRM database is a powerful tool that provides businesses with a number of benefits, including:
- Allows you to store large volumes of data: Allows you to track information such as customer demographics and past purchases without having to worry about file size limits or running out of hard drive space.
- Allows you to query data in seconds: For example, if your marketing department wants a list of all customers who have purchased more than 100 items from your website, this report could be generated in a matter of seconds by a database query.
- It allows you to modify a piece of data that will affect thousands of other pieces of data.
- In addition, CRM offers the possibility of adding users who can consult the data simultaneously, and work on it, without causing the data to become disconnected or broken. Like Excel, it also allows you to generate graphs and reports based on the data to understand what information is hidden behind it, and identify trends to plan the growth strategy.
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What are spreadsheets used for?
Spreadsheets are great for crunching numbers. If you have a lot of numbers to crunch and don't need the full CRM experience, spreadsheets can still be a good option for keeping track of your contacts.
The ability to easily perform calculations on large volumes of data with Excel or Google Sheets is one of its greatest strengths. Complex formulas can be used to add, subtract, multiply, divide, and analyze data quickly and accurately. You can also use Excel to create summary reports or even organize data in new ways that allow you to present it as an interactive dashboard or set of charts.
There's nothing wrong with Excel. Spreadsheets are made to be flexible and can handle a wide variety of calculations and formulas, making it a popular tool for analytical work. Most people know how to use basic features such as functions and formulas, making it easy to get started without any training. It's also a great tool for financial analysis because many business leaders understand this system.
Excel is a good choice if you're looking for something that lets you calculate some useful information or track basic data points over time, such as budget tracking or inventory management. You can easily share the file with your team members, and they can input the data they need without having to learn the system.
However, if you need to provide your company with a management tool that accompanies its growth, a spreadsheet will not be enough and you will need to adopt a database-based tool. Most CRMs offer free training to train their users and a network of certified instructors , to prevent lack of training from being one of the reasons why they do not adopt this type of tool. Do you know the HubSpot Academy?
Differences between spreadsheets and CRM databases
- Databases handle an unlimited number of records.
The nature of a spreadsheet is that it has to be built, field by field, from scratch. If it is not built well from the start, the spreadsheet may end up limiting the number of records that can be stored. In short, spreadsheets are not suited to the needs of your business. A database system, on the other hand, is designed to handle large amounts of data. It can store all the information you need, and you can add new fields in the future if necessary; there is no storage limit and new fields are easily added.
CRMs also give you valuable insight into sales performance based on statistical analysis of sales data across all customers or products (or both). CRM reporting tools give you an overview of what's happening at a glance and allow you to drill down into areas where more detail is needed. These reports can be easily shared with teammates or management via PDF export or HTML email options.
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- You can search a database for a specific record or set of records.
If you're already familiar with Excel, you might be wondering what Excel lacks over a CRM.
One of the biggest advantages of using a CRM is the search capability. You can search for records or sets of records based on multiple criteria. In Excel, you have to manually sort and filter data to find the records you are looking for. This can be cumbersome and time-consuming, but with a CRM's powerful search tools, finding a record is easy: all you have to do is type the information into the relevant fields or keywords into the search bar and press Enter.
What is the verdict?
Spreadsheets are powerful calculators, but databases are made to handle large amounts of data. They are designed to be fast and efficient, so you can manage hundreds or thousands of contacts in one place. With a database, you save information once and can sort it endlessly, whereas Excel will present limitations when you want to manage your contacts, affecting your customers' experience.
While spreadsheets are great calculators, they lack the power to manage all of your contacts. They work well for a few people at the beginning of your business, but as your company grows, spreadsheets become slow and complex to maintain. It's easy to get lost in complicated formulas or even accidentally delete important files when working with large amounts of data in a spreadsheet program like Excel.
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