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How to Build a SaaS CRM System: Brief Overview

Efficiently managing relationships with customers is the key to success for any company. However, doing it manually without a sophisticated solution in place takes too much time, effort, and money.

This is why many companies today use customer relationship management (CRM) software to comfortably manage all customer-related processes. In this article, we take a brief look at some major characteristics and deployment models of today’s CRM solutions, explore current CRM market trends, and describe the key aspects you need to focus on in order to develop a customer relationship management SaaS system.

Bridging the gap between businesses and customers

Customer relationship management is a popular approach to managing a company’s relationships with current and potential customers. To implement this approach, businesses often use dedicated CRM software. Using such a system, companies can stay connected to their customers, effectively manage all customer-related processes, and improve their overall performance and profitability.

According to FinancesOnline, businesses that use CRM tools report a 50% increase in the productivity of their teams.

figure 1

Initially, CRM approaches and tools were developed to serve the B2C market with its huge customer bases. For B2C businesses, personalizing offers for individual customers is complicated, and there’s always a question of efficient segmentation. Later, CRM solutions were adapted to the B2B market, which is characterized by long-term relationships and long sale cycles.

Сompanies use CRM software as a centralized solution for:

  • Gathering, storing, and processing customer contact information
  • Monitoring possible sales issues
  • Determining new sales opportunities
  • Managing marketing activities

Usually, a CRM solution may also be connected to other business applications deployed to manage and improve a company’s relationships with customers.

CRM systems are mostly used by three departments:

figure 2
  • Marketing teams use CRMs to plan their marketing campaigns and better target potential customers. They also use CRM software to measure the effectiveness and return on investment (ROI) of the company’s marketing activities.
  • Sales teams use CRMs to manage and automate day-to-day tasks, improve sales pipeline management, and analyze overall performance of the sales department.
  • Customer service teams use CRMs to build detailed customer profiles with information about previous interactions with the company. This information helps team members improve customer support and choose future customer engagement activities more efficiently.

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While there are multiple types of CRM solutions with different features, most fall into one of three categories:

  • Operational — for effectively managing daily tasks and processes
  • Analytical — for gathering, storing, and analyzing data on a company’s interactions with customers 
  • Collaborative — for connecting different teams and departments within a large company

Depending on their current needs, some companies may deploy specific software that targets only a limited scope of tasks or a complex solution that includes the functionality of all three types of CRM systems.

However, a new generation of CRM systems goes even further, implementing new technologies and offering revolutionary approaches to customer relationship management.

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CRM evolution: from mobile to AI-based technologies

Modern CRM systems go beyond standard functionalities and look at key customer relationship challenges from a different perspective. Let’s explore some of the recent improvements in the CRM software sector.

Mobile CRM systems — Seeing as 81% of companies that have deployed CRM systems use them on multiple platforms and devices, it comes as no surprise that mobile CRMs are gaining momentum. Cross-platform solutions with mobile apps bring users more comfort and flexibility and allow them to effectively manage critical processes from nearly anywhere in the world.

Extensive use of the cloud — Meanwhile, the adoption of cloud-based CRM systems is also increasing. Back in 2008, only 12% of businesses used cloud-based CRM solutions according to a Software Advice report. By 2014, this number had increased to 87%. And in 2019, Gartner estimated that SaaS solutions represented about 75% of the overall money businesses spent on CRM products. 

Integrations with social media — One of the key tasks of a CRM system is to gather all meaningful data on a company’s customers. Social media integrations bring this to a whole new level. After all, social media can be not only a source of new leads and valuable customer information but also an effective communication channel. And if you also want to ensure timely discovery of and response to unusual posts, check out our article about anomaly detection on social media.

Service personalization — The extensive use of customer data gathered from social media and other sources allows companies to significantly expand service personalization. As shown by a recent report from Accenture [PDF], about 75% of customers are likely to give their preferences to a buyer that recognizes them, remembers their purchase history, and can provide personalized, truly relevant recommendations.

AI-based functionality — Modern CRM systems have artificial intelligence (AI) capabilities. AI technology can be used to ensure better analysis of collected data, choose better ways for developing CRM SaaS systems, make it easier for companies to determine and target the needs of their customers, provide recommendations, and so on. In 2019, Gartner predicted that by 2020, nearly a third of B2B companies would introduce AI capabilities into their CRM systems.

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Furthermore, as estimated by Statista, by 2021, the use of AI in CRM systems will bring US companies an additional $394 billion in revenue.

As you can see, CRM platforms are constantly evolving, allowing businesses to address critical customer relationship management tasks more efficiently. However, there are a number of components that form the core of nearly any CRM solution. In the next section, we list and describe the most important ones.

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Core components of a CRM solution

Let’s take a look at some typical functional blocks of CRM software. Most CRM solutions cover all stages of the customer–seller interaction, from the initial lead or even prospect stage through all sales stages and right to converting from a lead to a fully-fledged customer. CRM solutions also track customer interactions, including upselling, cross-selling, and customer service. 

Throughout all these stages, the CRM analyzes the efficiency of various interactions and monitors customer reactions and behavior. Therefore, a CRM system usually includes the following components:

figure 3

Customer data storage and management. Centralized warehousing of all customer data, including customer profiles and interaction histories, is the most important function of any CRM platform. The most vital features here are:

  • Merging data from different sources and operations
  • Comprehensive data reports by request
  • Overall data analysis and consolidation of statistics

The more sources of customer data a solution supports, the better.

Marketing process management. A CRM system can effectively assist companies in building their marketing strategies and effectively running and automating marketing activities. Therefore, the marketing process management block of a CRM system usually includes tools and solutions for:

  • Planning, tracking, and measuring marketing activities
  • Building marketing campaigns
  • Managing social media activities
  • Generating and managing leads 
  • Conducting marketing analysis and collecting marketing intelligence

The minimal CRM functionality allows for obtaining or importing campaign-generated leads and tracking various marketing touchpoints for a lead or customer.

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Sales process automation. When a lead comes to the sales department, they get into the sales funnel and, through various interactions, eventually move from one sales stage to another. All these interactions should be tracked and measured, and a CRM system can do that. You can also create task automation bots to streamline the sales process.

To ensure quality management of sales processes and customer interactions, a CRM should include functionalities such as:

  • Clear attribution of customers to sales representatives or sales groups
  • Detailed tracking of all interactions and sales funnel statuses
  • Detailed purchase history for each customer

One more important feature is pipeline building and forecasting. Advanced tools may analyze the behavior of buyers and the efficiency of sales team members, offer insights on segmentation, categorization, and importance ratings, and handle other sales management features.

Customer service. This block of functionality streamlines interactions initiated by customers. Using this block, a company can benefit from building customer loyalty by applying a personalized approach based on a customer’s profile and interaction history, encouraging a closer relationship. 

If such features aren’t outsourced to a third-party platform, a CRM should also include features for tracking and managing inquiries. Advanced functionality may include a unified communication platform covering all interaction channels between the company and its customers. In particular, a CRM platform should cover interaction channels like:

  • Call centers
  • Email and web-based communications
  • Mail
  • Office visits
  • Self-service channels

All interaction insights must be recorded and added to the customer behavior profile to improve marketing and sales efforts.

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Business reporting. CRM systems gather, process, and produce extensive amounts of data that should be used for improving a company’s relationships with its customers. Therefore, reporting functionality is necessary for representing all that data in a comprehensive and useful form.

It’s important to make sure that reports generated by a CRM solution are:

  1. Detailed
  2. Accurate
  3. Precise
  4. Exportable

Minimal reporting functionality should provide a set of pipeline and status reports that offer an overview of the customer base, team’s work, revenue, and pipeline forecasts.

Analytics and business intelligence. Aside from gathering detailed reports on customer interactions and overall team efficiency, a CRM solution should provide users with basic analytics capabilities. Insights delivered may include:

  • Customer segmentation suggestions
  • Patterns of customer behavior
  • Identification of process problems
  • And more

Depending on the needs, goals, and even the size of the company, a CRM system may either include separate sophisticated tools for each of these functionalities or provide a simplified solution that covers the minimum set of tasks.

Industry-specific solutions simplify feature sets and make them more targeted, adapting processes to the needs of a particular business vertical. Such solutions can completely replace some blocks of functionality, such as marketing process management, with integrated third-party solutions and, at the same time, provide additional vertical-specific business management tools, such as for accounting and human resources management.

Alongside picking the right components to include in a CRM system, it’s important to choose a fitting deployment scheme. Even though support for mobile platforms is a common request from end users, the two most popular deployment schemes remain on-premises and in the cloud.

Let’s find out which of these options is better and why.

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Choosing between an on-premise and SaaS CRM

The first CRM solutions were built on-premises. An on-premise CRM is installed on-site, in a company’s own data center and on the computers of its end users. Therefore, the support and management of such a solution is always the responsibility of the local IT department.

On-premise CRM systems have several benefits, including:

  • Full control — Whether a CRM application is custom-made or purchased, when a company runs and manages it on-premises, they fully control its security and maintenance.
  • Data access — In contrast to cloud-based solutions, with on-premise CRM systems, the chance that critical data will be unavailable due to connectivity issues is much lower.
  • Data security — With no need to rely on cloud vendors or any other third parties, on-premise CRM tools can usually offer a higher level of data security and protection than their cloud-based analogues.

A SaaS CRM is a cloud-based solution that has a web interface and can be used as a regular web application. The key arguments in favor of a web CRM are the following:

  • Ease of management — Cloud-based CRM systems usually don’t require installing and configuring additional software on a user’s machine, making the platform easier to use and manage.
  • Scalability — SaaS CRM systems are more flexible and scalable than on-premise solutions. In particular, a company can easily change the number of active users, network bandwidth, and volume of data storage.
  • Cost-efficiency — The scalability of cloud-based CRM systems leads to another important benefit: cost-efficiency. With a SaaS solution in place, businesses need fewer resources (both financial and professional) to support and maintain their CRM.

See Table 1 to compare these two CRM system deployment schemes.

Table 1. SaaS CRM vs on-premise CRM comparison



On-premise CRM

Security and maintenanceThe company shares responsibility for data and system security and maintenance with the cloud vendor.The company is fully responsible for maintaining the system and keeping it secure. 
MobilityA web application can be accessed securely from any compatible internet-connected device.The system can only be accessed from a device, usually a computer, with an installed client.
CostMinimal capital investment.High capital investment.

Due to the collaborative and interconnected nature of CRMs, the SaaS approach was quickly applied to this type of software. Big players such as SAP, Oracle, and Microsoft developed SaaS versions of their CRM solutions, while CRM providers such as Salesforce and Zoho were born in the cloud. New players in this market prefer to create a cloud CRM right from the start.

In the next section, we cover key research and development nuances to pay attention to when building a CRM system as a Software as a Service product.

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R&D nuances of SaaS CRM development

The functionality and technology stack of a custom SaaS CRM solution fully depends on the goals and needs of a specific business. However, there are several important aspects you should consider when developing a CRM solution in the cloud:

  • Architecture
  • Data warehousing
  • Data security
  • Mobile platform support
  • Third-party integrations
  • Platform customization

Let’s take a closer look at each aspect.

Architecture. It’s crucial not to choose a simpler architecture at the early stages of SaaS application development. To build an efficient and flexible CRM system, you should make sure its architecture is flexible. Making changes at the architectural level after releasing the first version of your product will be both painful and expensive.

A stable, high-performance architecture enabling scalability in terms of both user capacity and features can become a solid core of your solution and a key to further product success. 

Data warehousing. In the heart of each CRM system is customer data. It should be stored, organized, and accessed securely and efficiently. Therefore, database design and cloud organization are two of the most important parts of the SaaS CRM development process.

A CRM solution should maintain comprehensive and actionable customer profiles, capable of merging details from various departments and displaying them when required. At the same time, it’s necessary to limit access to sensitive details according to security principles.

Data security. CRM systems store sensitive data like personal information and financial credentials of customers. With the SaaS delivery model, this data is stored on the cloud provider’s side, which creates security and compliance concerns.

Right from the first version of your product, it’s vital to ensure the absolute security of user data and compliance with relevant local and industry regulations. Check out our guides for complying with PCI DSS and GDPR for software developers.

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When building a CRM platform, you should consider encryption for data at rest and data in motion, advanced authentication capabilities (e.g. multi-factor authentication), user activity audits, support for specialist access, and account termination policies.

Mobile platform support. Compatibility with mobile platforms is one of the key trends in the CRM world. And with more and more companies implementing bring-your-own-device policies, support for different mobile platforms and devices is becoming a must for any SaaS CRM system.

Some target user groups heavily rely on mobile devices even for core processes. For example, small businesses can use smartphones as part of their point of sale systems. So it would be best to at least consider ensuring mobile support when developing a cloud CRM.

Third-party integrations. There are a lot of trusted third-party services that can make it easier for you to implement certain functionalities in your product. Smart integration with office applications, email applications, marketing automation tools, survey tools, ticket management platforms, and industry-specific services can add significant value to your product at relatively low cost.

Platform customization. Each business is unique, and there’s no single CRM platform that meets the needs of every company. Therefore, your task is to provide customization options for at least such features as:

  • Information representation
  • Reporting
  • Process management
  • Sales stages
  • Operation statuses

Customization is important even when you are building an MVP for SaaS project, as it will allow more early adopters to enjoy using your CRM SaaS product and see that it can fit their needs.

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CRM systems play a critical role in building trusting, efficient relationships between businesses and their customers. With a CRM solution in place, companies can gather valuable data on customer interactions, effectively process and analyze it, and use the knowledge gained to better meet the needs of their customers. Additionally, CRM platforms can help businesses improve collaboration both inside teams and departments and within the company as a whole.

Most enterprises and small businesses choose cloud-based CRM systems, as they’re easy to manage, scalable, and cost-efficient. However, building a flexible and efficient CRM system requires a professional architecture design, a carefully selected technology stack, and a number of development skills.

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