CRM sales in the small and midsize business market is exploding. This is good news for VARs.
Enterprise-level customer relationship management vendors, as well as pure mid-market plays, are slugging it out to capture their piece of this pie with various versions of their CRM suites, making their application offerings more affordable and more easily customizable.
This, in conjunction with the trend toward smaller organizations becoming more sophisticated and expecting to run equally effective applications as their enterprise counterparts, is making CRM one of the hottest areas of growth in the SMB 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 Ziff Davis eSeminars' two-day virtual tradeshow on SMB technology challenges.
In fact only 20 percent of SMBs out there have already deployed a CRM application, according to Barton Goldenberg, president and founder of ISM, a CRM consultant firm.
This is up tremendously from 8 percent just 3 years ago and rising fast, he said.
Goldenberg expects the CRM SMB market to reach $44 billion per year within the next 5 years.
"It is the fastest-growing technology market in SMBs," he said, adding that because of the nature of the technology and how important it is to an organization's 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 anyone's bubble, but the actual technology used in a CRM initiative takes a back seat to the company's processes and ways of doing business.
CRM starts with an organization's 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 spanning the entire organization in which everyone has access and input responsibilities.
Organizations look to a CRM solution to do many things: enhance productivity, lower costs, gain better customer knowledge, obtain higher customer satisfaction, as well as some other reasons.
Click here to read more about Sage's CRM suite targeted at SMBs.
Therefore, everyone in an organization that touches a customer in any way, shape or form needs to be involved in its CRM imitative.
As such, what CRM solution is needed and what it is used for depends 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 VAR's role in the evaluation and then deployment of a CRM solution is so vital.
Local VARs know their customers and 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. That point I will address in a future column.
Chris Selland, principal analyst at Covington Associates, reinforced this point during the same panel discussion. "When deploying a CRM solutions, customers need to get local help. 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 said, adding that this market is going to be a tremendous boon for resellers in the coming years.
Goldenberg agreed with Selland's assessment of the channel's critical role in implementing a successful CRM solution.
"CRM starts with awareness and then march [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.
Editor's Note: The Ziff Davis Internet SMB Solutions Virtual Tradeshow is run by eSeminars, a division of Ziff Davis Media, parent company of Ziff Davis Internet.
Elliot Markowitz is editor at large at The Channel Insider. He is also editorial director of Ziff Davis Media eSeminars. He can be reached at Elliot_Markowitz@ziffdavis.com.
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