Midsize companies are chucking their spreadsheets, standalone databases, and pens and sticky notes. They're investing in software applications that keep track of every bit of customer information they can get their hands on, from contact information and sales activity to marketing campaigns, prospective customers and new product ideas.

Businesses with fewer than 1,000 employees will account for about one-third of the spending for customer relationship management applications in 2006, including tools that manage sales-force automation and assist with customer and marketing analytics, according to an October report by Forrester Research. Vendors like Microsoft and SAP are targeting mid-market companies, recognizing that tracking and analyzing customer data is no less important for a $200 million company than for a $2 billion one.

But buying a software package to help manage customer data is one thing; deploying it successfully and realizing bottom-line benefits is another.

Baseline spoke to five mid-market companies with annual sales ranging from $200 million to $700 million, as well as three experts on customer technologies, to find the technology best practices mid-market companies should follow to attract new customers, retain existing ones and anticipate future growth.

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