What is Contact Management? (Everything Small Business Owners Should Know)

It takes a lot to become a contact in my phonebook. You have to send more than one text, and I have to look for your number a few times before I actually save it to my phone.

As you can imagine, this is a terrible contact management system. I lose phone numbers, get texts from people I don’t remember, and upset new friends when I don’t return their calls.

Now, imagine if I ran a business. My customers would be annoyed, to say the least, if I missed their phone calls, text messages, and emails – all because I had a poor contact management system.

In this post, I’ll explain what a contact manager is and why you (and I) need one to run your business. I’ll review how to manage your contacts in a CRM and highlight the best contact management software you can download as well.

What is the definition of contact management?

Contact management is the process of storing and organizing points of communication with your customers. It includes all of your customers’ phone numbers, emails, and any other channels they use to contact you. This data is stored in software like a phonebook or CRM, where you can recall the information as needed.

For example, here’s a contact profile stored in a CRM. If you’re unfamiliar with CRMs, they’re databases that house customer information and track interactions with your business (read more about CRMs here).

This example shows the contact’s name, email, phone number, and social media accounts. We can also view past conversations with them like this:

You might also notice that there are different actions we can take in this contact management system. For example, we can record notes, book appointments, and review payments with each customer. We can also start new conversations and add them to an email list.

The system that stores all this information is called a contact manager. Let’s discuss these in more depth.

What is a contact manager?

A contact manager is a software that stores and organizes business contacts. It records customer information and tracks their activity with your company. A good contact manager paints a complete picture of your customer relationships so you can find timely opportunities to interact with people and create better experiences.

Your phone likely has a built-in contact manager. For Apple and Android users, the “Contacts” app lets you manually add and update contacts to your phone. Here’s what both of these apps look like on your phone:

But, when you run a small business, you need something more cutting-edge. Here’s where a CRM or customer relationship management software comes into play. It works similarly to a phonebook, but instead, it automatically adds and updates contacts for you. It also connects with your marketing and sales tools so you can create timely and relevant advertisements.

Let’s talk more about how you can manage contacts with a CRM in the next section.

CRM Contact Management

Here are a few tasks that your CRM or contact manager should help you with:

• Contact Creation: Your CRM should automatically create contacts when customers engage with your business. It should connect to your email, phone, and social media channels, generating new contacts once customers communicate with you.

• Customer Communication: Your CRM should have a shared inbox so all your customers’ messages are stored in one place. You shouldn’t have to jump between apps to view previous conversations.

• List Management: You should be able to organize contacts into lists within your CRM. That will make it easier to message customers in bulk and launch effective marketing campaigns.

• Marketing Automation: Marketing automation means streamlining repetitive tasks with AI. Rather than writing a “thank you” note for every purchase, your CRM should automatically send these messages.

• Booking & Scheduling: Scheduling software is important for service-based companies. Your CRM should have built-in tools that make it easy for customers to book appointments on your website, local listings, and social media pages.

• Payments: Your CRM should show you previous purchases and current deals that have yet to be paid for. It should also have tools to write invoices and send them to customers.

Now, let’s review some best practices to remember when managing business contacts.

How to Manage Business Contacts

Here are a few tips to manage your business contacts effectively. While your system might look different from other businesses, these tips should help you stay on top of customer communication and ensure important messages are never overlooked or lost.

Adopt a contact management system.

By now, we’ve made the case for adopting a contact management system or CRM. It stores your data in one place, making marketing and sales campaigns easier.

If you’re looking for a formal recommendation, we’ll dive into the best contact management systems at the end of this post. Click here to go there now.

Store all of your data in one place.

CRMs are great, but you only need one. Having more than that defeats the purpose because you’re switching between apps to find information.

That doesn’t mean you have to abandon your current system; it just means you have to connect your existing channels to your CRM. That will help you store all your data in one centralized location, making it easy to find whatever information you need.

It’s also beneficial if you work with a team. Coworkers can quickly find information without going to you or another employee. That streamlines your workflow and creates a better customer experience because you can provide speedier solutions to customer problems.

Connect your communication channels.

Your contact manager won’t be useful if you don’t connect it to your communication channels. You’ll have to manually create contacts whenever they connect with your business. Not only is this tedious, but you risk losing or misreading information. Connecting your communication channels will automatically create contacts once they reach out to your business.

The other benefit of connecting your communication channels is activity tracking. You’ll see every conversation you’ve had with each customer regardless of the platform they used. You can leverage this information to make clients happier and develop stronger relationships with your customer base.

Add new fields and integrations.

A “field” is like a contact characteristic. It provides context about your customers, such as what they do, where they work, and what their needs may be. For example, most CRMs include demographic information as fields within their database. In the graphic below, we can see that information like address, name, and phone number are also listed as fields.

Most contact management systems will let you add custom fields for your business. You can use these to add industry-specific information about your customers. For instance, a landscaper might create a custom field for lawn sizes so they know how big of a project they’re undertaking. Storing information like this can help you nurture customer relationships, personalize what you offer or say to them, and run a more efficient business.

Filter and tag your contacts.

Most CRMs and contact managers include “tags” that you can assign to contacts. Tags are identifiers that group people into lists so you can filter your database to find specific customers. You can then send messages to these contacts based on the tags associated with their profiles.

For example, let’s say I want to email a group of customers over 40 years old who live in North Dakota. In my CRM, I could filter my contacts by age and location, then create a tag and assign it to people who fit these filters.

Now, when I search for that tag, I get a complete list of customers who are older than 40 and live in North Dakota. I can send them emails, track their activity, and nurture my relationships with these clients.

Create lists for bulk communication.

Tags are great for filtering and finding contacts. But what if you want to email a group of customers that don’t share the same characteristics?

Here’s where lists come into play. Lists group customers together based on your criteria. You can group customers based on tags, fields, or anything else that makes sense for your business.

Lists offer more flexibility than tags and can be static or dynamic based on the provider that you’re using. Static lists don’t change over time, while dynamic lists update as new contacts are added to your database. Both are useful for businesses that use email marketing to communicate with customers.

Audit your contact manager.

“Auditing your contact manager” just means keeping it clean and organized over time. You don’t want contacts that are inactive or have outdated information. That can lead to poor customer experiences and negative effects on your company’s online reputation.

For example, let’s say we have several contacts that have never responded to our emails. If we keep sending messages to them, not only is that annoying, but it can actually hurt our delivery rates. Here’s how: To determine how legitimate emails are, email providers (like Gmail) review how many people have engaged with your messages. If contacts constantly ignore your emails, that sends a signal to email providers that your content is spam, and they should filter out messages from your company.

To avoid this:

1. Make sure your CRM is up to date.
2. Filter for contacts who haven’t engaged with you in a while and send them a follow-up message asking them if they want to keep getting your emails. If they ignore it, delete the contact.
3. If they respond, send them another message and re-engage them with your business.

Ready to get started with contact management? Below are the best solutions available for small business owners.

What is the best contact management software?

Here are five of the best contact management systems for small businesses. The “best” for your business will depend on its size, industry, and customer needs.

1. Thryv

Thryv is a business management platform that recently revamped its CRM software. It’s ideal for small business owners in service-based and professional services industries like construction, cleaning, accounting, health and wellness, and more.

Thryv lets you create a custom view of each contact in your CRM so you only see relevant information about your customer base. It also integrates with communication and marketing tools, making attracting and retaining new customers easier. Thryv also provides a handy mobile app and payment features perfect for business owners who work on the go.

Thryv’s CRM provides everything you need to manage a business from your home, office, or worksite.

Price: $228/month for Plus plan; $382/month for Pro plan; $533/month for Unlimited plan

2. Keap

Best For: Small Business Automation

Keap is a CRM platform that automates contact management. It can follow up with contacts who were recently added to your account and personalize your email communication with names, companies, and addresses from your CRM. 

Keap’s automation tools use a drag-and-drop system to trigger different events at your business. You pick what starts the event and then add steps that your CRM will take automatically. You can also choose a pre-built automation from one of the templates provided. This is a handy feature for business owners who don’t have the time or experience to customize their business technology. 

Price: $249/month

3. Salesforce

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Salesforce is one of the biggest names in contact management. It caters to growing businesses with multiple teams and locations and has premium features like an AI assistant that helps you manage your contact database. Salesforce is great if you’ve used a CRM before and are looking for a solution with advanced capabilities. If you want something simpler, Salesforce offers a “Starter Suite” with basic email and analytics features.

Price: $25/month for Small Business Starter Suite; $100/month for Small Business Pro Suite

4. Monday.com

Monday.com is a CRM and customer service system for small businesses. Its best features include tracking open deals with customers and monitoring sales performance. You can see how many people bought something from your business and how much revenue you’ve generated each month.

Monday.com also offers useful automation tools, like chatbots, to install on your website. Chatbots respond to customers for you, so you can provide 24/7 support even when you’re not on your phone or computer. They’re great for creating positive customer experiences that lead to repeat deals.

Price: $12/user/month for Basic plan; $17/user/month for Standard plan; $28/user/month for Pro plan

5. Pipedrive

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Pipedrive is a contact management system designed for sales teams. It helps you manage your daily workflow by providing updates and reminders about upcoming events. For example, it will notify you when you have a meeting and remind you to follow up with customers afterward. It’s like a personal assistant that keeps you focused during a busy workday.

Pipedrive is also compatible with over 400 apps. It’s great for businesses that use multiple communication channels and need one solution to store all their data in one place.

Price: $14/user/month for Essential plan; $34/user/month for Advanced plan; $49/user/month for Professional plan; $64/user/month for Power plan; $99/user/month for Enterprise plan

6. Nutshell

Nutshell is a CRM created for service-based industries like hospitality and IT. What I like about this CRM is that it shows you where each contact is on a map. It also shows you live weather updates for that area so you can plan accordingly if you have an appointment. These features are great if you constantly travel for jobs and want a CRM that makes being in the field and downloading directions convenient.

Price: $16/user/month for Foundation plan; $42/user/month for Pro plan; $52/user/month for Power AI plan; $67/user/month for Enterprise plan

Contact Relation Management for Small Businesses

Contact management is crucial for any business, but can be tedious and time-consuming. Recording customer information manually takes a lot of effort, which is why it helps to have a CRM to automate this process for you. Use the tips in this post to create an efficient CRM and develop a contact management system that benefits your business. Pair that with one of the options above, and you’ll be well on your way to mastering contact management at your business.