Small Business Should Embrace CRM in 2008

By Brent Leary

Customer relationship management providers have tailored their offerings for the small business market, providing software-as-a-service options, integration with other technologies, and an understanding of what small businesses want.

I’ve been involved in with customer relationship management (CRM) in some capacity for the past ten years. During the past five years, my focus has been on helping small and mid-sized businesses understand how CRM can help them in finding, catching, and keeping good customers. But CRM got slapped with a much deserved reputation as being too costly, too time consuming, too complex, and too disruptive to be successful. Even though most of the horror stories were at the enterprise level, most small businesses were scared away from even thinking about implementing CRM.

Over the last few years, however, thanks to software-as-a-service CRM providers like Salesforce.com and NetSuite, CRM has rehabilitated its tarnished image. Because of this, large enterprises along with mid-sized companies have opened up their arms and embraced CRM in its more affordable, easier, and accessible reincarnation. And while a growing number of small businesses have also turned to CRM, the vast majority have not as of yet. I think 2008 is shaping up to be the year when small businesses join the CRM party. Here are a few reasons why.

So that's what CRM is

Until recently many small business people still really didn’t know what CRM was and how it could help them. That shouldn’t come as a big surprise. Performing a Google search on the term “What is CRM?” returns close to two million definitions for customer relationship management. Formal definitions usually include the integration of people, process, and technology to maximize relationships and provide seamless coordination between all customer-facing functions. But the emphasis was always on technology, which typically meant buying software and servers, and having IT staff at the ready. This alone was enough to scare off the average small business with no internal IT staff.

So it was difficult in the past for small businesses to view CRM as anything other than technology. But thanks to SaaS erasing most of the IT requirements of the past, small businesses are able to focus on the impact CRM can have on the issues important to them -- like leveraging the Web to acquire new customers, selling more to current customers, analyzing the effectiveness of marketing activities, and providing better customer service to keep valuable customers happy. All in the name of building stronger, longer lasting business relationships. These are things any small business can understand if they can get past technology fears and industry jargon.

Inheriting the Web

Small businesses are looking to the Web to help them find, catch, and keep customers. They are buying into the power the Web has in creating opportunities to reach more people at the most important time: when they are looking for products and services to solve an issue. They are using e-mail marketing, search engine optimization, and even dabbling in social networking in order to build relationships with customers and prospects. And there are a number of CRM services on the market today that make it fairly easy to create landing pages, execute e-mail campaigns, and even manage search engine marketing campaigns. Infusion Software, an SaaS CRM provider focusing on small businesses, even includes affiliate tracking to allow companies to keep tabs of business coming in from partners. Concursive offers a suite that integrates CRM with website creation and content management. And both Salesforce.com and NetSuite allow you to manage Google AdWord campaigns from within their services.

Mobility is also important to small business people, as they spend less time in an office, but need to respond quickly and accurately to customers and prospects. Providers like Salesforce.com and SageCRM.com are making it easier than ever to access CRM data and functionality on devices like the BlackBerry. And NetSuite and other providers like EBSuite and HEAP have created interfaces specifically for the iPhone.

As our personal and professional lives converge and our dependence on the Web grows along with our need to do more while on the go, CRM providers have made it possible to for us to be respond quickly and meaningfully to customers.

The Microsoft factor

While it’s been around for years now, many small businesses have remained on the fence about both SaaS and CRM. Even with Salesforce.com grabbing headlines and bringing attention to the space, small businesses haven’t been too comfortable with the idea of having their customer information outside of their premises. But that may change with Microsoft’s upcoming Live CRM offering scheduled for release in the next couple of months. Microsoft has been offering CRM products for years now, but Live CRM is their first SaaS (or as they like to say Software and Services) offering. And to millions of small business people who run their businesses with software like Office, Outlook, and Windows, Microsoft joining the SaaS brigade validates the service option in ways the smaller, lesser known companies haven’t been able to do.

So expect to see more small businesses giving CRM a second look with a less skeptical eye than they have before. While Microsoft will bring in new customers because of their name, they will also bring more attention to the whole industry. Small businesses will find lots of great options out there from companies like Infusion, Zoho, Salesboom, and others that are focused on serving the small business community. Salesforce.com and NetSuite, of course, are still there leading the charge.

The time is now

With prices more affordable than ever and tools easier to use and accessible from anywhere, it looks like 2008 is the year small businesses move en masse towards CRM. However, it also appears that the industry has finally moved towards small businesses by creating the products and services they’ve needed all along: the tools they need to build meaningful relationships with those looking for the products and services they provide. That’s what small businesses have been waiting for all along.

Brent Leary is a small business technology analyst, advisor, speaker and award winning blogger. He’s the host of “Technology… for Business $ake”, a weekly radio program on www.BusinessTechnologyRadio.com. His popular blog can be found at www.brentleary.com.