Whether you use a CRM or not, chances are you’ve heard of Salesforce (dot com). After all, their name is synonymous with CRM and they’ve been recognized year after year as being one of the more innovative products, not just in their own market, but in the world. Salesforce is known for its state-of-the-art platform that can be implemented by companies across all industries and sizes, is supported by thousands of developers and integrated applications, and features an award-winning mobile platform. No other company has accomplished as much in the CRM space as Salesforce.
Since its inception in 1999, Salesforce has expanded its product from traditional CRM, primarily focusing on sales and customer management, to establishing itself as a platform for businesses to build upon. Enterprise companies have benefited greatly from this strategy. Over the years, their product portfolio has expanded tenfold to include many solutions that businesses can embrace and benefit from, including customer service, sales tools, data management, and integration with thousands of third-party applications. Salesforce has acquired over 40 companies throughout the past decade in an ongoing effort to improve their platform and capabilities, a methodology that will undoubtedly continue as newer groundbreaking technology emerges. Their marketplace is one of the largest of its kind, with over 3,000 apps, and growing each year. With all of this said, one thing about Salesforce rings true among all of its users: you either love it or you hate it.
Why Small Businesses Don’t Like Salesforce
For more than a decade, we (Mothernode CRM) often compete with Salesforce’s CRM mid-grade plans in the small business market. These are generally businesses earning between $1-million and $5-million in annual revenue and usually comprised of 2-20 users. We have competed against Salesforce when companies were evaluating CRMs, but we have also competed with other CRMs when existing Salesforce customers were looking for an alternative solution once their subscription ended.
When dealing with the latter, regardless of industry or company size, we observed similar responses from companies wanting to leave Salesforce. Interestingly enough, during subsequent conversations with these companies, they predictably detail four primary reasons for leaving Salesforce.
Following are the top four reasons that small and mid-sized businesses have decided to leave Salesforce:
Cost
There are two costs that are related to every mid-market CRM; monthly subscriptions and implementations or setup. Relatively compared to other CRMs on the market, Salesforce’s entry line includes competitively priced monthly subscriptions, based on a per-user, per-month rate. However, unlike many of its competitors, Salesforce requires your annual subscription to be paid in advance. This means your $75/month subscription requires a $900 annual payment (per-user) to start, which can be a significant cost for small businesses, especially if your user count rises over the coming years. You also run the risk of paying for licenses you may not need if you downsize your user count. Implementation fees are far more likely to be on the high-end. In many cases, we heard that their fees were surprisingly unreasonable when compared to other small business CRM, with setup costs beginning at $10,000.
There’s no question that there is a significant market for small business CRM, and Salesforce definitely wants a piece of the pie. But by only accepting annual plans, some customers were left feeling that once their payment processed, they were left on their own, and felt that their subscription lacked the service they expected. It would also seem that Salesforce’s pricing model and sometimes high implementation costs are a way of vetting their customer base. For the small business, the cost of Salesforce can be pricey, but for Salesforce a small business account is insignificant and easily replaced.
Penalizing Business Growth
Another cost increase that many small businesses don’t expect is essentially a penalty for growing. This is odd considering the philosophy behind most every CRM is helping companies grow. However, Salesforce appears to believe that if your business is growing in terms of revenue and employees, then they should be able to tap into your growth and make more money as well. Regardless of whether you like using Salesforce or not, their price increases can break your CRM budget. This is why before selecting a CRM, you should consider your growth and what your long-term CRM costs might look like.
Using Salesforce’s own pricing from their website, we can see how the growth of your business can generate rising costs of your CRM investment.
Assume that your company has 5 users and you’re looking for a CRM. Salesforce’s Lightning Essentials Edition seems like a great place to start with a budget-conscious entry point of $25/user/month (paid annually of course). This would require an annual payment of $1,500 for a 5-user subscription. However, in the event that you add a 6th user, most would assume the cost would increase by another $25/month, or $300/year. But this isn’t the case. Per the specified pricing, the $25/month/user plan is only available for up to 5 users (Out-of-the-box CRM for up to 5 users). This means that once you exceed 5 users you are automatically promoted into the next plan, which increases each user cost to $75/user/month or $5,400/year, which is a $3,900 difference and a 260% increase in your Salesforce subscription.
Complexity
Salesforce offers a variety of training resources, including videos and tutorials, and with the largest community of users, it won’t be difficult to have your questions answered. However, even when you learn how to do something it doesn’t necessarily ensure that the process is convenient or even sensible.
Aside from the aforementioned cost issues, the largest and more common complaints by users relate to the complexities in the processes when using the application. Most users claimed to become frustrated with either the number of steps it took to accomplish more common tasks or the number of screens they would have to bounce between when using the program.
While Salesforce has modernized their application with their new Lightning Interface, some of the legacy processes still remain. Some Salesforce customers who have customized their CRM application find themselves having to remain on their legacy platform and can’t take advantage of the newer, simplified interface.
We have spoken with a number of small businesses over the past decade that used Salesforce, and almost all of them noted that they had simplified their use of the program in order to avoid dealing with more cumbersome processes. As a consequence, many subscribers struggled to fully adopt Salesforce and use the program to its fullest potential, never maximizing its true value. This most likely explains why Salesforce only accepts annual subscriptions, preventing inevitable cancellation before a 12-month term would end.
ROI
Everyone expects a return on their investment, and that is never truer when using software that is geared towards boosting sales, automating processes and making you more efficient in your daily tasks, collectively and individually. That said, Salesforce, like any CRM, requires a healthy adoption and full participation from its users. How you use it will also have an influence on your ROI. If you’re using it to manage contacts and conversations, you’re paying too much and should consider a budget CRM with a monthly subscription.
Achieving ROI as a small business using Salesforce can be a challenge. When considering the complexities and the potential challenges that can come with adoption, small businesses may give up on the more overwhelming processes and never tap into the more advanced components critical to achieving ROI.
Furthermore, when only a few people in your organization really use the program, while others give up or never commit, then the application’s value immediately diminishes. Without 100% buy-in, it will never truly serve as a platform to run your sales and customer service on. In fairness to Salesforce, and any other CRM, you get-out what you put-in. Part of the challenge may relate to stubborn personalities and a personnel issue, not always a software problem. But if the problem stems from new processes being difficult to integrate, cumbersome to use, requiring too many extra steps, then there is a software challenge that should be investigated and addressed.
Conclusion
While your business has general requirements that are consistent with any organization and industry, such as sales, customer service, customer management, etc., how you address your daily operations is up to you, so plan for a solution that you and your company can use and scale for the years ahead. Perhaps Salesforce is the right solution for you, despite some of the challenges that are more common among users in smaller organizations. Like every good CRM, it has both strengths and weaknesses. If the cost of deployment and upfront subscriptions fit comfortably in your budget, then it’s worth evaluating. As mentioned early in this article, Salesforce’s audience is pretty much divided into one of two camps; those who love it and those who don’t. With this in mind, we hope that the considerations we’ve presented will help you better gauge the CRM market and determine the CRM that will best fit your company’s budget, revenue and growth objectives.
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