The Difference Between CEM and CRM Software Solutions

BY -

Phil Strazzulla

November 16, 2020

Customer relationship management (CRM) and customer experience management (CEM) are commonly confused with one another. On the surface, both software solution types capture and analyze customer information, which is why businesses often question if they need to have both and if one can cover the same functionality of the other.

This confusion is quite understandable, especially since CRM and CEM solutions also share the same goal of boosting a company’s profitability through the optimization of its business strategies. While their goal might be similar, the approaches both CRM and CEM solutions take to achieve it are different, and we’ll explain how in the following paragraphs. 


What does a CRM software do?


CRM gear turning feature gears: finance, marketing, customer service, sales, analysis, implementation
(Source)


CRM systems help businesses drive sales growth by building and maintaining long-lasting relationships with their customers. CRM systems keep comprehensive records of all interactions and transactions you’ve made with existing and potential customers, including and how and when they became a customer, how often they’ve purchased from you, how much they have spent, etc. This information is then used to fine tune the sales process and create targeted marketing campaigns.

CRM platforms help companies address the following questions: 

  • Are we more focused on short-term sales rather than long-term customer relationship building that leads to organic growth?
  • Are we paying enough attention to existing customers as much as we are focusing on new customer acquisition? 
  • Are we taking into consideration the financial capability and interest level of customers before targeting them with aggressive cross-selling and upselling strategies? 
  • How can we bring back customers who no longer seem to be interested in our offerings?
  • Are we keeping a database of comprehensive customer profiles as opposed to just a digitized Rolodex?

What does a CEM software do?


Customer experience management capabilities
(Source)


A customer experience management software (commonly abbreviated as CEM, CXM, or CX software) performs a range of functions besides helping you collect and analyze customer feedback. The goal of CEM solutions is to provide businesses with real-time, actionable insights into their customers’ likes and dislikes to increase customer satisfaction, retention rate and ultimately, the company’s bottom line.

CEM platforms help companies address the following questions:  

  • What factors are causing some customers to have a negative experience?
  • What changes can we implement to eradicate those factors?
  • How come customer experience varies among customers who have relatively received the same offerings and service?
  • Are we delivering exceptional experiences throughout all stages of the customer lifecycle?
  • Are our current customer experience management strategies good enough to foster customer loyalty? 

Similarities between CRM and CEM systems

Customer relationship management and Customer experience management comparison


Both CRM and CEM solutions help businesses collect and analyze customer information, keep detailed customer profiles, track customer journeys, as well as finetune marketing campaigns based on real-time customer data. 

The majority of CEM and CRM solutions integrate with companies’ email, phone, live chat, and social media to streamline communication with customers. They may also offer some of the following capabilities, or achieve it through integration with 3rd party software solutions:

  • Partner Relationship Management (PRM)
  • Customer Support Management (CSM)
  • Team Collaboration
  • Survey and Form Building
  • Web Analytics
  • Content Management (CMS)
  • Digital Asset Management (DAM)
  • E-commerce
  • Enterprise Resource Planning (ERP)
  • Supply Chain Management (SCM)

Should you get a CRM, a CEM, or both?

Seeing how CRM and CEM solutions aren’t interchangeable, companies can invest in both of them while keeping the following considerations in mind: 

  • CRM solutions are usually implemented first, while CEM solutions work best in combination with other business solutions (including CRMs) and aren’t commonly purchased in isolation.
  • CRM solutions can and should be purchased by businesses of all sizes. Seeing how they’re sales driven, they help businesses grow while keeping operational costs low. For example, small businesses benefit from the features and automations CRM solutions offer to organize and manage large data without needing to increase their team’s size.
  • CEM solutions are crucial for large operations. The bigger your customer base gets, the more likely you are going to fall short in ensuring each customer has an excellent experience. This is why you’ll need to invest in innovative experience improving and relationship fostering tools to set yourself apart from competitors, keep customer churn rates under control, and gain a number of loyal customers that’ll not only stay on but also act as advocates for your business.


Final Thoughts

At a time when customers have numerous product and service options to choose from, investing in measures that build meaningful relationships and deliver personalized experiences is how companies stand out from competitors and stay in business. Several studies have concluded this, including one by Salesforce, suggesting that business leaders who leverage CRM solutions see an increase in sales by as much as 29%, while a study by Forrester estimates that business leaders who focus on CEM strategies achieve five times more revenue growth than their CEM-laggard competitors.

There are so many CRM and CEM solutions available today, each with different offerings and price points. Before implementing them for your business, make sure you have a clear idea of your needs and challenges, then carefully select products capable of addressing them.

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