CRM sales in the SMB market are exploding. This is good news for VARs. Enterprise-level CRM vendors, as well as pure plays in the midmarket, are slugging it out for a slice of this pie with various versions of their customer relationship management suites, making their application offerings more affordable and more easily customizable.
Combined with smaller organizations becoming more sophisticated and expecting to run applications that are as effective as those run by their enterprise counterparts, this market competition is making CRM one of the hottest areas of growth in the small- and midsize-business space.
This point was hammered home during an editorial panel discussion, titled "Improve Customer Satisfaction And Sales Productivity With CRM," that I moderated as part of a virtual trade show on SMB technology challenges sponsored by Ziff Davis Medias eSeminars.
In fact, only 20 percent of SMBs have already deployed a CRM application, according to Barton Goldenberg, president and founder of ISM, a CRM consultancy. This is up from 8 percent three years ago and rising fast, said Goldenberg, who expects the CRM SMB market to reach $44 billion per year in the next five years.
"It is the fastest-growing technology market in SMBs," Goldenberg said, adding that because of the nature of the technology and how important it is to an organizations overall strategy, resellers, VARs and consultants are absolutely essential.
I agree completely. CRM is more than a technology sell. In fact, the technology portion of a CRM solution is probably just the final phase. And—sorry to burst anyones bubble—but the technology used in a CRM initiative takes a back seat to a companys processes and ways of doing business.
CRM starts with an organizations overall objectives—what it wants to accomplish and how it wants to communicate and reach out and touch its customers.
CRM is more than simply a sales or marketing automation tool used to help an organization monitor and track its sales leads. It is an end-to-end, companywide solution in which everyone has access and input responsibilities.
Organizations look to a CRM solution to do many things, including enhance productivity, lower costs, gain better customer knowledge and obtain higher customer satisfaction. Therefore, everyone in an organization who touches a customer in any way, shape or form needs to be involved in its CRM initiative.
As such, what CRM solution is needed and what it is used for depend greatly on the type of an organization, its market and its business strategy. Organizations that look at CRM as a pure technology purchase will ultimately fail and be frustrated. That is why a VARs role in the evaluation and deployment of a CRM solution is so vital. Local VARs know their customers well. They know their business processes, how they go to market and what they are looking to accomplish.
It is impossible for a vendor to be as close to an end-user customer as a VAR. Chris Selland, an analyst at Covington Associates, reinforced this point during the panel discussion.
"When deploying a CRM solution, customers need to get local help," Selland said. "They need to work with partners. They need to find a local VAR that can shield them from the turmoil [of trying to deal with so many CRM vendors] and help them make smart decisions." He added that this market is going to be a tremendous boon for resellers in the coming years.
Goldenberg supported Sellands assessment of the channels critical role in implementing a successful CRM solution. "CRM starts with awareness and then [marches the customer] up the ladder. The bottom line is CRM is about customers, so organizations need to seek advice from the very best," he said.
And the wise choice to turn to is the local VAR that knows the business better than some vendor 3,000 miles away.
Elliot Markowitz is editor at large at The Channel Insider, as well as editorial director of Ziff Davis Medias eSeminars. He can be reached at firstname.lastname@example.org.