The CRM vendor landscape for Small-to-Midsize organizations includes a wide variety of solutions, including those traditionally built for enterprise organizations. The popularity of Software-as-a-Service (SaaS) offerings and the low-cost scalability of these solutions have led many enterprise on-demand CRM providers down-market with lower-priced, and sometimes feature-light, options for small and midsize businesses. But enterprise-class CRM is still more expensive and at times, too feature-rich for small-to-midsize adoption. Survey results suggest small and midsize businesses are extracting more value from CRM solutions that are exclusively designed and targeted for small and midsize organizations. In fact, small business survey participants ranked the most popular big four CRM solution providers including Salesforce.com, SAP, Microsoft Dynamics, and Oracle lower than “other” providers. Having said that, inclusion on the Good, Better, Best Vendor Flash Charts represents top tier providers based on user rankings, regardless of which classification they fall under.
For most small and midsize organizations price plays a critical role in the decision to invest in CRM. Most on-demand CRM offerings are priced monthly on a per user basis providing discounts on long-term annual contracts. In many cases, on-premise solutions with annual license fees are still extremely compelling options for small businesses. From a pricing standpoint, it’s also important to consider the price-to-feature ratio in the CRM solution of choice. Most enterprise CRM provides deliver core sales force automation capabilities natively, but require separate modules or partner solutions (which require additional monthly fees) to augment CRM with multi-channel marketing, configure price quote, eCommerce integration, forecasting, etc. For a midsize company, a variety of stand-alone solutions that integrate with CRM are often necessary given the size and complexity of the organization. But for small businesses, the cost of multiple disparate solutions makes this an undesirable option at best. For this reason, an emerging class of low-cost small business CRM technologies now include features to manage marketing, sales, and customer service from a single platform at a fraction of the cost of enterprise offerings.
Core sales force automation capabilities in CRM are largely commoditized and do little to differentiate providers for a small and midsize buyer. But, pre-packaged or pre-built integration with accounting and marketing technologies is growing in popularity for small businesses. In 2012, Top Performers ranked integration with sales and marketing systems a top three reason for implementing CRM. Naturally, Top Performing organizations leverage this integration to deliver more intimate interactions with customers and prospects.
Key trends: SMBs have a unique set of needs when it comes to CRM. It must be easy to configure and easy to use, and most importantly cost sensitive. Vendors are moving to more comprehensive offerings for low cost-per-user per month offerings—a lthough it’s often cheaper to invest in on-premise than to pay on-demand monthly fees for years on end.
That said, vendors that position solutions around SMB CRM will often tout benefits outside of CRM, such as more comprehensive ERP, service, or marketing solutions. SMBs shouldn’t be alarmed by these added capabilities. While it might not be a core focus today when you just want to manage contacts more efficiently, it’s important to pick a provider that can scale as the business grows. It’s a lot easier to rely on additional capabilities that are already integrated with a solution than to go invest in multiple separate systems that create disparate data issues.
You can view the FLASH Vendor Rankings for SMB CRM Solutions here.