The Devils in the Details when Selecting CRM Software

Advice for Small to Mid-Size Businesses

The Devil is in the Details when selecting CRM Software

The CRM software market is booming and is expected to increase 12% year over year according to Gartner. Despite this growth user adoption is extraordinarily low, customer satisfaction is poor and a large number of companies have indicated that within the first year they had switched CRM vendors because the product they selected did not provide the features they required. I can confirm this because the majority of the inquiries my firm gets every day is from companies that already have a CRM solution, but indicate that it does not meet their needs or is too hard to use.  The question is, why is this happening at such an alarming rate and what can you do to ensure this doesn’t happen in your business?

Let’s first look at the cause of this which I believe is two-fold.  Let’s start with companies that are new to CRM or first time buyers.

#1 Poorly Defined Business Requirements

I cannot begin to tell you how many companies my firm deals with that not only have poorly defined business requirements, but in some cases, no requirements at all.  My team will ask why they are looking for a CRM solution and what specifically it needs to do.  The answers are always generic; we need a good CRM system that’s easy to use.  This is a clear indication that management has not taken the time to define and document what they require from a CRM solution, what problem(s) they are trying to resolve, and how they will measure success.  In addition, chances are the people evaluating the products are not professional software purchasers.  In fact, very few people are.  They have no guidance from management and are not experienced enough to know what questions to ask. As a result, their decision is often based on perceived value, cosmetic appeal and price.  This is not the proper approach to selecting the right CRM solution for the business and I believe is the main culprit of the problem.

#2 False Expectations

Consumers love free or low-cost products and for some reason many small businesses believe they can get everything they need in a free or low-cost CRM solution. Of course, if you have not taken the time to document your specific business requirements and you are looking for a “good system that’s easy to use” as stated above, a free solution looks enticing. In fact, if you are just looking to manage contacts, notes and activities some of these are pretty good.  By this I mean they work and will not blow up on you. But these products are cheap or free for a reason.  They typically are chock full of limitations: data entry and storage limitations, functional limitations, no workflow capabilities, limited or no customization, no reporting, no filtering of data, no security permissions, and no integration with third party products. Telephone support is non-existent, and don’t expect to see new features or product enhancements.

Of course, this is by design and you cannot fault the vendor.  If I am offering you my product for free, I don’t want to hear from you.

Perhaps most important is the hosting, management, and security of your data.  I can tell you that my firm uses one of the best data hosting services in the industry and it’s not cheap. How someone can offer a quality data hosting service for free is absolutely amazing and guess what, they can’t.  While the majority of companies that contact my firm never ask where their data is, if it’s properly backed-up or how can they access it in an emergency, I would suggest that if you are considering a free or low cost solution, you pay close attention to what they are offering. Regardless of the above if you are a very small business, with a few basic requirements and a limited budget you may find some value in these offerings. Just don’t have false expectations of what you are going to get.

Searching for the Right CRM

Narrowing your search for a CRM solution does not have to be that difficult because the solution providers have done a pretty good job of positioning themselves by market sector.  In the small business sector, there are several hundred solutions available and most of the firms are struggling to differentiate themselves. These companies typically offer a basic out of the box, one size fits all solution for managing contacts, notes, activities and sales.  They target companies of 2 to 10 users who have limited requirements and limited budgets.  This sector has to some degree become a bit of a race to the bottom with more and more companies either reducing their price or offering a number of free users if you select them.  It’s hard to differentiate these products or find a compelling reason to select one over the other and with pricing so low I am not sure there is a sustainable business here.    If you are considering one of these solutions I recommend you check the company’s data hosting service, what level of customer support can you expect and how often product enhancements are made and offered to customers. This will tell you more about the company and its sustainability which may be more important than the product itself.

The middle market is the most challenging of all and has the least amount of product offerings.  CRM solution providers that cater to this sector typically offer what is referred to as “All in One CRM”.  This means you can automate all front office services such as Sales, Marketing and Customer Service. Some vendors now offer integrated Project Management as well.  These products offer comprehensive functionality, advanced reporting and analytics, customer portals and integration with third party software programs. Data hosting services are typically best in class and the software is supported by a highly trained staff of professionals that can ensure that the product is tailored to meet your specific requirement and that your staff is properly trained so that they realize the maximum value from the solution.

The most interesting thing about these mid-market offerings is that in many cases based on the functionality you select, they are not that much more expensive than the low-cost ones that offer half the features, limited support and second or third tier data hosting services.  If you really want to get the most from a CRM solution and believe your business will be growing in the future I believe these offerings are the true value play.

Lastly are the products designed for enterprise level companies.   These products target Fortune 500 firms that require use of the product for several hundred and in some cases, several thousand users.  They have very detailed functional requirements and often require extensive customization, integration with several disparate systems like e-commerce, ERP or accounting systems and multi-language, multi-currency support. Installation and on-boarding of these products can take several months.

So, there you have it. A quick analysis of the industry and some tips on where to focus based on the size of your business and the level functionality and customer support you will require.  Remember however, “The Devil’s in the Details.”

About the author:

Larry Caretsky is President of Commence Corporation, a leading provider of CRM solutions for growing businesses and a top 20 selection by Capterra and other software review sites.

Caretsky is considered an expert on CRM and has written numerous white papers on the subject and an e-book, Practices That Pay.  These are all available on the company’s website at commence.com/blog.  You can contact him directly at sales@commence.com.

Leave a Reply

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