CRM Competitors Invade Salesforce.com Territory

Posted by Commence on March 18, 2013 under CEO Corner | 2 Comments to Read

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.

  • John Crabtree said,

    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.

  • Daniel Geoghan said,

    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.

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