Introducing CRM Solutions To Customers w/Guest Analyst Laurie McCabe

For background on the adoption of customer relationship management (CRM) software and insight on how channel partners can introduce CRM solutions to their customers, ChannelPro Managing Editor Cecilia Galvin spoke with Laurie McCabe, vice president of SMB Insights and Business Solutions at AMI-Partners.


ChannelPro: How pervasive are CRM solutions in the small and midsize business (SMB) market?

McCabe: Only about 16 percent of small businesses in the U.S. currently use CRM solutions, and another 16 percent say they plan to adopt CRM in the next 12 months. So in the small business market, CRM is underpenetrated, although many businesses are using homegrown CRM solutions—maybe a combination of Outlook and Excel, or a PC database, or a desktop contact management solution. In the midsize business market, however, CRM is now mainstream, with about 39 percent of businesses using it, and about 24 percent planning to adopt it in the next 12 months. There are a lot of homegrown and desktop contact management solutions being deployed in this market as well, but there are a lot more of what are actually called CRM products— whether they’re on-premise or hosted services.

ChannelPro: Are changes occurring in the CRM market that will increase adoption by SMBs?

McCabe: In the past, vendors did not understand the needs of the SMB market, so their products weren’t on the mark. Now, however, the market is hot, so vendors are vying for the SMB dollar and are creating the products, packaging, and pricing that SMBs need. Hosted, on-demand CRM solutions will help boost adoption too, because of their reduced cost and complexity. In the small business market, 13 percent of companies are using this type of solution; a good percentage of the medium business market is too. A lot of vendors have also been paying attention to ease of use, which is key in SMBs.

ChannelPro: What advice might you offer to partners about selling CRM solutions?

McCabe: Approach it educationally. A lot of customers know that CRM means “customer relationship management,” but they probably don’t understand the service value of it, the different kinds of CRM solutions, or whether they need a comprehensive system for sales, marketing, and customer service, or simply sales force automation. Understand what the big pain point is for a particular customer, and then what CRM solution is most appropriate for that. If you know that a comprehensive solution would be great for a customer, but that right now it would be biting off more than they could chew, start small. Sell something “incremental but integrative.” Start with one module, let the customer have some success with it, and then integrate other modules. And have a mix of products. If you’re trying to sell only one vendor’s brand, or only on-premise, or only hosted, you’re not going to have enough in your bag of tricks. A lot of customers are open to either hosted or on-premise. So you need to offer those two choices. You need to have some brand choices as well, because some vendors are focused on the midmarket and some on the small. You want to have three or four solutions that will hit the mark.