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What is contact management software?

Contact management software is a software tool that lets you collect contact information for customers, vendors, employees, and partners, plus track your communication with them. Contact management software helps you get your network going quickly without the massive implementation process required by more robust customer relationship management (CRM) software. Some contact management tools also integrate with various other software, such as shift scheduling platforms, for additional functionality.

Gone are the days of shuffling around index cards and loading them into rolodexes. No matter how small or large your business is, contact management systems make it a snap to capture, sort, and communicate with all your business contacts. If you’re looking to upgrade your contacts from the native contact app on your phone or in your email, here’s what you need to know about contact management systems.

 

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Why do you need contact management software?

If you’re currently keeping your business contacts organized in a physical rolodex, contact management software is the perfect way to bring your network into the 21st century without completely overhauling your processes. Contact management software makes it a breeze to collect, organize, and search all your contacts to find potential customers, vendors, and partners.

While contact management software offers less functionality than a full-fledged CRM, it’s much easier to use and comes with a lower price tag to match the smaller number of features. This makes a CMS an excellent choice for small start-ups who neither need a full CRM nor can justify the price, but need to upgrade from sticky notes or a spreadsheet.

How contact management systems work

At their core, contact management systems are simple to understand and operate. They usually consist of a searchable database that includes files of each person’s or business’s contact details. They also usually contain a messaging feature of some sort that syncs with the contact files, providing seamless integrations. They also may or may not offer additional functionality depending on whether they are part of a larger CRM or whether they offer integrations with other software platforms.

The essential features of contact management systems are not that complicated and typically include a contact database, a messaging function, and the potential for integrations with other software as your business grows. Here is what you should look for in each of these features:

Contact database

The contact database should make it easy to add entries and custom fields. It should also make it easy to tag and sort all the entries, so you can distinguish your employees from your vendors, for example. Ideally, the database should also make it easy to import contacts from your email or another channel and auto populate fields when appropriate.

Messaging

Contact management software is more than just a digital rolodex. It should also offer the ability to message people directly from the database via email, Zoom call, or whatever your method of choice is. It should also track your communications, so you never have to wonder whether or not you sent that urgent email.

Integrations and/or CRM functionality

Your business will eventually grow past even the most robust contact management system. Thus, the best ones offer the ability to grow their functionality, either because they offer integration with third-party tools or because they are part of an entry-level CRM product.

Contact management software vs. CRM vs. lead management

It can be confusing to determine the difference between contact management software, a CRM system, and lead management. This is complicated by the fact that contact management is a foundational feature that is almost always included in a broader CRM software. Indeed, there are very few true stand-alone products that only offer contact management capabilities.

CRMs are more robust platforms that include a wide array of features such as employee tracking, document management, workflow automation, reporting and analytics, and more. When fully utilized, CRMs are used by multiple teams from HR to sales. Basically, CRM governs every aspect of customer management, while contact management focuses only on the contact management portion.

Lead management is another sub-category of functionality that is usually included within a CRM’s portfolio of features. However, you can also get stand-alone lead management products if you are not ready for a full CRM yet. Lead management focuses on organizing, nurturing, and communicating with your leads in order to qualify them and convert them into sales.

Lead management software is used more strictly by the sales team, while CRM systems and contact management software may be beneficial for almost anyone in the company. Moreover, lead management is more narrowly tailored to current and potential customers as opposed to contact management software, which can be used for anyone. It also offers additional features that are specifically beneficial for sales teams—such as lead enrichment and scoring rules—that aren’t really useful for contact management systems.

Trends in contact management software

Most of the trends in contact management software follow the trajectory of the broader CRM market. Here are some things to key your eye on as the contact management space continues to evolve:

Artificial intelligence (AI)

Artificial intelligence is impacting basically every aspect of business software, and contact management is no exception. One day soon, an AI may suggest what contact you want to email next before you can even search for their name.

Data analysis

There’s more data in your contacts than you think, and contact management systems are just beginning to explore this space. Maybe you get a better response rate from potential vendors in one industry than another, and soon your contact management software might be able to help you identify these trends.

Mobility

In a modern world that is constantly on the go, being able to message business contacts from your phone and tablet is increasingly important. A mobile app with seamless functionality that rivals the desktop version will soon become a given.

Creating executive buy-in for a contact management system

Getting executive buy-in is key for adopting any software, including contact management systems.

  • Chief Technology Officer (CTO): Talk to them as early as possible about how contact management software can eliminate redundancies and create efficiencies for all communications within the company.
  • Chief Financial Officer (CFO): Offer a cost-benefit analysis and explain how investing in a contact management system will help your business cut costs and achieve more profits in the long run.
  • Chief Executive Officer (CEO): Focus on the big picture and explain how everyone at the company as well as current and prospective customers will benefit from the convenient communication of a contact management system.

Choosing a contact management system

Your main decision when choosing a contact management system will be whether you want to choose an entry-level CRM with contact management features that leaves you room to grow, but may be more functionality than you need right now, or if you want to go with a software that only offers contact management functionality for now, with the knowledge that you may need to upgrade to a CRM later.

This won’t necessarily be dictated by your budget. While it may seem like contact management software would be more cost-effective due to the more limited functionality, HubSpot CRM offers a basic version that is free in perpetuity, and Zoho CRM is free for up to three users as well. It really comes down to whether you want a true contact management system, or a CRM that may be overkill for now but helpful later on.

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