CRM, DMS for Automotive Industry: Difference & Benefits

CRM, DMS for Automotive Industry: Difference & Benefits-feature image
March 31, 2023 Reviewed By : Asheet Makhija .8 Min read

CRM DMS are the two popularly used software in car dealerships or the automotive industry. But people often get confused between the purpose of these two software solutions, and which one should be used.

We are here to answer all these questions and help you decide whether you should implement one of the software between the DMS CRM system or use a combination of both.

What Is CRM?


CRM or Customer Relationship Management software helps organizations to manage their interactions with potential and existing customers. It helps you with contact management, keeping a record of customer queries, managing different marketing campaigns, and identifying new sales opportunities, all on a centralized platform.

Everyone in your organization including the sales, customer service, and marketing teams can access data on CRM for better collaboration and increased productivity.

These teams can view the details of how and with whom your customers have communicated, what all services or products they have bought, what was their last purchase from you, how much they have paid, and a lot more.

Why Use CRM Systems?

Any business must use a Customer Relationship Management System to build stronger relationships with their customers and prospects. CRM software will give you a 360 view of your customers by collecting information about their contact details, social media behavior, email ID, and more from multiple sources.

This information helps businesses to offer personalized products or services to their customers or prospects. Your sales representatives will know their prospects and will be equipped with information to offer the best deal that meets their requirements.

Along with this, a CRM system will equally be useful for your customer service teams in delivering the best after-sales service. Today customers want every piece of information in just a few seconds, which becomes difficult when your representatives do not have the right information on their fingertips.

Suggested Read: Difference Between CRM and Marketing Automation Software

Benefits of Implementing CRM Systems for Automotive Industry

Benefits of Implementing CRM Systems for Automotive Industry

Using CRM in the automotive industry will benefit dealers by helping them to analyze customer data, manage customer lifecycle, collect client feedback, automate routine tasks, and more.

Let’s understand these benefits of CRM in detail.

  • Analysis of Customer Data

You might have a good amount of customer data but if it is not stored, used, and analyzed effectively, all of it is just a waste. However, CRM implementation will help in managing your customer data and store it on a centralized platform where all the teams can easily access and analyze it.

Car dealership owners can use customer information on CRM for automotive industry to segment their customers according to gender, age, income level, preferences, etc. It also helps in devising the most effective upselling and cross-selling deals to drive more ROI.

  • Customer Lifecycle Management

In the automobile industry, there are various stages in the customer lifecycle such as acquiring and sorting prospects and leads, offering finance schemes, persuading your customers to take test drives, offering the best after sales services, sending marketing offers, and more.

With CRM, you can update what has been offered to your customers and at what stage of the sales pipeline. This information will further help team leaders and service agents to monitor customers’ SLA and provide timely services.

  • Customer Feedback

A CRM can help you in collecting and analyzing the customer feedback through intelligent analytics and dashboards. You can identify what’s the best thing customers like about you and even the worst thing that might be resulting in customer loss. If you have poor customer feedback and you are not acting upon it timely, you might lose major revenue sources.

  • Task Automation

With the CRM for automotive industry, you can automatically send reminders regarding insurance renewal, car or bike servicing, discounts, news offers, etc. Customer service agents can follow up with the customers interested in your services and offer cross sell packages.

  • Making the Best out of Referrals

Referrals are the most important business prospects that you can generate for your business. Especially, when dealing in the automotive industry, you must know that people buy such big things like cars and bikes, mostly through referrals. So, an advanced automotive CRM can help you in getting referrals from your customers, and later you can follow up with them to boost your sales.

Limitations of CRM Systems

You might have to face the following limitations while using a CRM system:

  • Automobile businesses might find the CRM implementation cost high after paying for features like reporting, analytics, customization, subscriptions, etc.
  • Your staff might not be open or flexible about switching to CRM software, their resistance to learning new technology can be a problem.
  • CRM makes all the customer related information available to all employees, which may raise security concerns for confidentiality of data

What is DMS?

What is DMS

DMS, a Dealer Management System is a platform designed especially for the automotive industry that allows users to manage business operations, sales, vehicle inventory, credit reports, paperwork, and more. The main objective of implementing DMS software is to smoothen daily operations by bringing everything on one centralized platform and eliminating the need for multiple solutions to manage sales, customer service, inventory, etc.

Suggested Read: Importance of CRM in the Modern Business Environment: Why You Need One?

Why Use DMS System?

The automotive or dealership industry involves a lot of moving parts like repairing parts, equipment, etc. Departments such as finance, sales, customer service, inventory, etc., need to stay in sync for smooth functioning, which is not possible if things are still done using pen and paper. These older techniques will eventually become a hurdle when you are willing to expand.

However, dealership businesses can avoid inefficiencies by implementing a DMS. It helps in better coordination among accountants, managers, technicians, service agents, etc., while increasing their productivity.

Benefits of Implementing DMS System for Automotive Industry

Benefits of Implementing DMS System for Automotive Industry

By implementing a DMS system, dealers can offer better customer services, indulge in data-driven marketing by using analytics, effectively manage inventory across stores and departments, etc.

  • All In One Solution for Dealers

After implementing a DMS, you don’t need to use any other software to manage any workflow. DMS will take care of all the operations, starting from sales to after-sales services and everything else in between. It comes with features like tools & analytics, inventory management, lead management, and service scheduling, among others.

  • Better Customer Service

Dealers are today not just in competition with neighboring dealers but with also online car dealers or third-party agencies that provide vehicle insurance or car servicing services. The only thing that can keep you ahead of your competition is your customer service. For example, the service department can use DMS to get a clear view of upcoming service schedules and prioritize accordingly to adhere to deadlines.

  • Data Driven Marketing

Making assumptions about what customers want won’t help you target the right pain points. You need to be powered by data to understand what your customers are looking for. DMS can help you understand this by generating easy-to-understand reports and simplifying huge amounts of data.

For example, you can use data to understand trends in your offline sales, like which model has maximum sales, what insurance plans are popular, and more. In fact, even website analytics can help you understand how many visitors come to your website, what pages they frequently surf through, how much time they spend on every page, and more. These online web insights along with offline reports for sales will equip you to create targeted marketing campaigns and put your efforts in the right direction.

  • In-Built Inventory Management

DMS offers an inventory control function, using which dealers can find out the availability of required batches at any given point in time. It also helps in identifying which equipment requires servicing, what tools are to be ordered, and more.

Suggested Read: 14 Best CRM Software for Small Businesses in India

Limitations of DMS System

  • Lack of willingness to accept or learn a new technology by ground staff
  • Limited integration options with your existing systems like accounting
  • Cyber threats to your customers’ personal information

Difference Between CRM and DMS

Customer Relationship Management offers centralization of a business’ interaction with its customers. It helps you manage customer’s contact information, purchases, payments, interactions with customer services, and more.

Although, DMS also offers centralization, but of all the business operations. It focuses on maintaining better coordination and improving efficiencies among teams for smoother operations. Using DMS, dealers can track sales, manage inventory, create contracts, generate bill estimates, etc.

Do You Need Both, CRM & DMS?

Let’s try to understand if you need both, CRM DMS service in your dealership store.

Businesses can use an integration of both- CRM DMS systems to save money and time and receive exponential results. Where CRM can streamline all your interactions with your customers and help you increase sales, a DMS can help you achieve operational efficiency by streamlining the paperwork related to sales, renewal, and other types of contracts.

Related Categories: Mobile CRM Software | Pharma CRM Software | Travel Agency CRM Software | Healthcare CRM Software | Real Estate CRM Software | Call Center CRM Software | Sales CRM Software


  1. What is DMS in automotive?

    DMS in automotive is a Dealer Management System designed to manage business operations, sales, vehicle inventory, credit reports, revenue, and more.

  2. What is CRM in automotive?

    CRM or Customer Relationship Management software in the automotive industry helps dealers and workshops to manage their interactions with potential and existing customers.

  3. Is a DMS the same as a CRM?

    No, DMS CRM systems are not the same. The prime function of a CRM is to manage your clients’ database. However, a DMS system helps you effectively manage operations like sales, inventory management, and create new contracts for customers.

  4. How does the DMS system work?

    DMS allows departments such as finance, sales, customer service, etc., to stay in sync for smooth functioning of the business. It enables dealers to check the status of customers in the sales pipeline, track available inventory, make contracts, and more.

Written by Isha Lamba

Isha’s writing journey started way back in 2018 when she graduated in the field of Journalism & Mass Communication. Since then, she has been writing for all digital and print marketing assets including blogs, editorial reviews, landing pages, emailers, and more. She has contributed her writings to genres... Read more

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