CRM software is considered a commodity market today, especially for very small businesses that have basic requirements such as a need to manage contacts, activities, notes and e-mail history.  Most of the companies that serve this sector now offer their products for free because it’s simply too costly to market, sell, and provide service to customers for a few dollars per user per month.  They use their CRM solution as a loss leader because they often have other products and services to sell you; and now that you’re a customer they have your company name, contacts, phone and e-mail addresses. So, expect to hear from them as part of their free offering.

If one of these basic cookie-cutter solutions meets your business requirements that’s great, but if you’re thinking that ‘all CRM solutions are the same… why pay for one?’ you’re dead wrong. Many people differentiate CRM solutions by price alone. It’s not a bad approach because price does in fact differentiate the basic low-cost or freemium solutions from those that cost more. The key is identifying what you may or may not be getting for the price you are willing to pay. Here are just a few things to consider before making your decision.

Free and low-cost CRM solutions come with limitations

Traditionally there are limitations on the number of accounts and contacts you can have, number of reports you can generate, number of custom fields you can add, number of e-mails you can send, and no group calendaring. More importantly there is often no online data security, no permissions (so all data is visible to all users), little to no customization, no system integration, and no phone support.   If you do not want these limitations – expect to pay about $30 dollars per user per month for a good solution.

Data Hosting Service

If you are concerned about the storage and protection of your online data (and you should be), it is important to note that the top tier data storage companies like Amazon Web Services, Rackspace, and others are not free which simply means the following. If you select a free or low-cost CRM solution you are not getting the high level of data security and protection service that is provided by higher cost CRM solution providers. If you are OK with this, it is still important to ask the vendor where your data is being stored and how you can get to it if needed.

Security Permissions

There are times when you need to ensure that certain data is only viewed by specific internal resources. Perhaps you want to make sure a sales representative in San Francisco cannot see the leads or accounts being worked on by a representative in New York. Or maybe there is a major account in the system only accessible by the management team. This is simply not possible with low end or freemium products.

System Integration

If you need to integrate your CRM solution with a third-party software program chances are this is just not offered by low end or freemium solutions. This feature is in the higher cost products.

Customer Service

Let’s be real here. If you select a free or low-cost CRM solution, you have no right to expect that you can get on the telephone with a company representative and get free advice and counsel. The best you can hope for is the ability to send an e-mail and hope someone responds, or that you can get your questions answered via the company’s web site.  Higher cost products traditionally provide telephone support and have a named account manager assigned to your company.

There are, of course, other things to consider when selecting a CRM solution. My objective here is to ensure buyers fully understand that all CRM systems are not alike and that there are limitations associated with low-cost or freemium solutions.

About the Author

Larry Caretsky represents Commence Corporation a provider of CRM solutions for small to mid-size businesses. Commence CRM is rated as a Top 20 Most Popular CRM solution by the Gartner Group’s Capterra review site.  Commence CRM offers a robust set of applications for sales, marketing, customer service, and project management. The product is affordable and easy to use making it a popular alternative to higher cost programs like Microsoft Dynamics CRM and Salesforce.com.