CRM on the Cheap

Updated: April 30, 2009

These days, there's no shortage of bargain-basement-priced CRM applications. From SugarCRM and vtiger to AppShore and Salesboom , savvy startups are offering small-to-medium-sized businesses a way to boost customer loyalty at a reasonable price point. Just ask Timothy Hickernell. An Info-Tech Research Group senior analyst, Hickernell said, "If a company needs to do contact management and account management on the fly, there are a lot of cheap solutions out there." But is a $9 per-user/per-month price tag, as is the case with AppShore, all that it's cracked up to be?

According to many small businesses, the answer is a resounding yes. In the case of AppShore, for example, there's nothing to install and nothing to download — users just sign up, log in and get started. All users need is an Internet connection and a browser. And features of the AppShore Professional Edition include lead management, customization reports, email campaigns, contact management and case management.

The Open-Source Advantage

SugarCRM, on the other hand, offers commercial, open-source CRM software for companies of all sizes. The company's professional on-demand solution costs just $40 per user per month. More cost-effective than proprietary applications, SugarCRM's open-source architecture lets users seamlessly customize and integrate customer-facing business processes. What's more, SugarCRM offers several deployment options, including on-demand, on-premise and appliance-based solutions to suit customers' security, integration and configuration requirements.

Said Hickernell, "SugarCRM is definitely a company that wishes would go away, that's for sure. SugarCRM is following in the same tracks and has a really impressive variety of tools and features for its application."

Vtiger, another penny-pinching contender, is built over proven, fast and reliable LAMP/WAMP (Linux/Windows, Apache, MySQL and PHP) technologies and other open-source projects. Vtiger CRM includes enterprise features such as Sales Force Automation , customer support, marketing automation , inventory management, multiple database support, security management, product customization, calendaring and email integration.

And finally, Salesboom provides Web-based services that meet the budgetary constraints of most small-to-medium-sized businesses while delivering effective services. The company's Enterprise Edition is a wall-to-wall hosted CRM and ERP (Enterprise Resource Planning) solution that can be integrated across the enterprise in real time and includes inventory management, product management, project management, accounting and HR management solutions.

What the Future Holds

Many of today's cheap CRM solutions are capable of pleasing a company's bean counters while offering standard functionality. But Hickernell said that young businesses need to ask themselves some important questions before committing to a vendor. "Small companies have to look to the future," he warned. "If you're a startup and you want to grow, are you going to be able to stay with that vendor in two years?"

After all, the ideal CRM solution today may seem limited in functionality and capabilities down the line as a growing company builds out its call center, expands geographically or begins to require more detailed information on its customers' buying patterns and history.

For this reason, it's crucial that companies on the hunt for a CRM system look for upgrade paths that will allow them to grow with a solution into full-spectrum CRM. And as a company digs deeper into CRM functionality, so too should it prepare to dig deeper into its pockets.

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