By Larry Caretsky

I recently wrote an article titled “CRM: A Race to the Bottom” where I discussed the cut throat competitive nature of the customer relationship management software industry where vendors are doing almost anything to attract new customers. I am afraid that there will not be any winners in this race, but there will be a loser and that’s the customer. What makes me say this? A simple business analysis that has proven over and over again that the approach many of these CRM vendors are taking, that is offering a low cost product with free service, is simply not sustainable. There seems to be a mindset that these vendors need to win new business at any cost, but one by one they are leaving the business or simply pulling their product off the market.

Intuit, the manufacturer of QuickBooks, recently discontinued the sale of their cloud based CRM system leaving their customers scrambling to find an alternative. And Highrise a fairly popular low cost CRM software program has discontinued the sale of their CRM software as well. I suspect we will see more of this from low cost solution providers that are winning business, but losing money doing it.

The customer relationship management software business is resource intensive. Customers that select quality products with robust functionality may need assistance with implementation and training, guidance on how to realize the maximum value from the product, and help with customization or disparate system integration. These resources and the delivery of high quality service comes at a cost. Getting a good deal on a CRM software solution means very little if the software vendor cannot afford the resources to continue to support their product. Make sure you ask the vendor you are considering about their support options. Free e-mail is the standard answer. Don’t accept it.

About the author

Larry Caretsky is the president of Commence Corporation, a leading provider of CRM software and best business practices for improving sales, marketing and customer service. Caretsky is considered an expert in sales automation and has written numerous articles on the subject of CRM. These may be viewed on the company’s web site at commenceaug202.wpengine.com.

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