CRM Competitors Invade Salesforce.com Territory

Trying to gain groundNow that the enterprise CRM market has become saturated, CRM solution provider Salesforce.com has set their sights on the small to mid-size market. But they are running into some stiff competition in this sector.

Salesforce.com has done an excellent job at building their brand and creating name recognition.  How have they done this?  With a lot of money and some tricky marketing.  The problem is that they have a cost structure that’s not really designed for small to mid-size enterprises.  Let’s face it, Salesforce.com was designed for enterprise level companies that have unique business requirements – features that people simply had to pay dearly for if they really required them. I am referring to things like multi-language and multi-currency support and the ability to support several thousand users.

But small to mid-size companies often do not require this, and if you compare the features you get in the Group and Professional Editions to competitive CRM products you will discover that Salesforce.com can cost twice as much or more.  You see, when people evaluate Salesforce.com they tend to focus their energy on what they will be getting when they should really be looking at what they are not getting.  Here are just a few examples you will find right on their pricing page.

  • For $25 dollars per user per month I see that I get Dashboards. That’s great, but if I want customizable dashboards, well that’s $65 dollars per user. Tricky marketing I would say. The problem here is that many of Salesforce.com’s competitors offer customizable dashboards as a standard component of their product for a lot less money.
  • What about role permissions or security settings?  That’s also part of the $65 dollar per user per month Professional Edition, but a standard feature in competitive products at half the cost.
  • Want graphical reporting? No problem, $65 dollar per user per month. But once again, half the cost with competitive offerings.

So what am I getting with Salesforce CRM at the Contact Management or Group Edition level?

  • How about limitations with the number of users you can have.  The Contact Management and Group Editions are limited to only 5 users. Add a sixth and you have to upgrade to the next edition and pay much, much more – really?
  • Perhaps it’s world class customer service that’s attracting you.  The website says send an e-mail and you can expect a response within 48 hours. Of course you can also pay if you want to talk with a human being.  So much for customer relationship management!

So what is it about this company that makes people buy?  Is it the badge of honor once bestowed to companies like IBM in the 70’s?  I really don’t know, but it does look as through the path to winning the small to mid-size community may be a bit more difficult for Salesforce.com.  These are savvy businesses that have learned to do a lot with very little, and are more price sensitive than enterprise corporations.  With strong competition coming from companies like Microsoft and Commence CRM at half the cost, the water may get a bit choppier for Salesforce.com in the months ahead.  We will have to wait and see.

Image by Nathan Rupert on Flickr under Creative Commons license.

5 thoughts on “CRM Competitors Invade Salesforce.com Territory

  1. I agree with the overall sentiment of the article. I believe many people buy Salesforce because that is the only thing that they’ve ever heard of. Small businesses should take more time when buying a CRM and realize that they have options and good ones at that.

  2. Good article. People do have a tendency to buy based on name recognition and I would agree that SF.com is not the right solution for small to mid-size businesses. I am not sure I would agree that Microsoft CRM is half the price however. Once their reseller gets involved the cost goes up very high. Commence CRM pricing does appear attractive and their references are very good. Probably worth a look.

  3. Yes, completely agree with the content of this article. There are several solutions in addition to Commence CRM that offer more value. Why overpay for Salesforce.com when the others have caught up to them. Commence CRM does offer very comprehensive functionality and the customer references are very good. Certainly a solution to consider and check out.

  4. Good article, SF.com has set the stage as the first real cloud based CRM solution, but now many others have caught up making it a highly competitive sector. SF.com is too expensive at this time and I would agree that Microsoft Dyanmics and Commence CRM are better choices for some organizations.

  5. Salesforce has restructured their product offerings and pricing since May, a couple of months after this posting. It would be great to re-evaluate your thoughts now. Salesforce IQ is one example which replaced Group Edition, and Professional Edition has taken on some Enterprise features. Regardless of the size of the company, they all want the enterprise features to drive their business needs (outside of the core product features given to all). Salesforce doesn’t scale their price on company size. I often find start-ups wanting the features but can’t pay the enterprise price. Then, I often see enterprise company buying the features and wasting their money on users who don’t adopt. So, give the enterprise money to the SMB’s and the SMB’s will give the enterprise company people resources, fair trade? I do believe Salesforce provides a tremendous opportunity for long-term growth and this investment can pay out greater when starting here than somewhere else. There are less expensive CRM’s and then just cheaper CRM’s. Look forward to an update if you get around to it.

    One last thing, with any Salesforce purchase, you have access to probably the best Cloud Computing Community built up of users, developers, admins and ISV’s. This is priceless!! This community is flat out amazing. Secondly, Salesforce introduced Trailhead, last year, which is a free training resource even to non-licensed users. So when you consider the price, you have to take these items into account as well.

Leave a Reply

Your email address will not be published. Required fields are marked *