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CRM @Vantage: Issue #1 |
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What is the cost of 3 Leads Lost? Research indicates that small business doesn’t follow up on up to 70% of all leads, representing as much as 14-22% of annual revenue …..CRM can help with these issues. |
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This issue CRM @Vantage provides a high level viewpoint from a leading research firm regarding affordability and value of CRM for Small and Medium Business organizations.
For information on our complimentary CRM Executive Assessment
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What Is the Cost of 3 Leads Lost?
Think CRM is too expensive and complicated for small businesses? Think again.
Every lead is precious, yet interviews with small businesses conducted by AMR Research reveal that small businesses do not follow up on up to 70 percent of all leads, representing as much as 14–22 percent of annual revenue. This is because there is often no centralized place to track customer, account, and contact information.
Technology can help solve these issues. In fact, the revenue gained from following up on three of those previously lost leads often covers the cost of a contact, lead, account, and case management system.
The Benefits of CRM Technology The functionality required to address lead leakage falls into the category of Customer Relationship Management, or CRM. Unfortunately, CRM has developed a reputation as making for large, often unwieldy software solutions for large companies that often do not deliver real business benefits.
The truth is that CRM technology has been specifically designed for small businesses. There are elements of CRM systems, such as contact, lead, account, order, and case management, that are fundamental to small businesses and deliver tangible business value.
The benefits of CRM technology stem from increased revenue and decreased costs. Increased revenue primarily comes from more satisfied customers, the ability to upsell and cross-sell, and higher acceptance rates on marketing campaigns. Reduced costs are attained through a reduction in administrative time used to track down information, improved reporting, and quicker issue resolution.
Small Businesses Can Afford CRM With costs in the $500–750 range per user, customer management technology is definitely more affordable for small business than in the past.
Choosing the Right Functionality Successful CRM projects address an acute pain felt by salespeople, customer service agents, or marketers. Functionality should be purchased in priority order to address the highest pain points. Small successes are then built on to keep momentum going.
The top 10 small business pain points are:
Decision-Making Factors Small businesses should consider four key decision-making factors when embarking upon a CRM project: business process change, vendor selection, timeline, and cost.
Business process change: The goal is to introduce common processes, not to fundamentally change the way the company does business. Small businesses should choose ease of use over complex functionality that requires major business process adaptation.
Vendor selection: It is often necessary to make two vendor decisions: software vendor and implementation vendor. Implementation partners are chosen based on their ability to work well with business and IT teams and their understanding of industry-specific requirements. The software vendor selection is based on functionality, ease of use, implementation time, referenceability, and company viability.
Timeline: Implementation timeline varies from two weeks to two months with an average of thirty days.
Cost: The cost is typically $500–750 US per user per year. Maintenance and support typically represent 20–24 percent of the implementation cost (17 percent of software, plus support personnel) for licensed applications. Many software companies offer financing options to make this more digestible to small businesses.
How to Purchase Technology Tailored for Small Businesses Software companies have developed solutions specifically targeted for small businesses. These are not simply stripped-down versions of software for large companies. Rather, they have been tailored for the unique needs of small businesses: they are integrated, simple to use, and less expensive than their enterprise brethren.
There are two key methods for purchasing software: licensed or hosted.
Licensed applications: Companies purchase user licenses and implement the software, hardware, networking, and personnel to support the system. Customers pay a yearly maintenance fee as well. This is also referred to as on-premises, onsite, or internal software.
Hosted software: Customers purchase licenses and have a vendor support and manage the application. Some vendors offer the ability to host their solution and then bring it in-house at a later date. Others are only offered as hosted solutions.
Cases in Point: Customer Success Stories The following case studies were collected by AMR Research. These three companies use Microsoft Business Solutions CRM.
Summary The right CRM technology investments help small businesses to sell more to existing customers, acquire new customers faster, and better manage the business. CRM solutions pay for themselves by capturing the business that would have otherwise been lost. |
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Receive a complimentary 1 day CRM Executive Assessment from VirtualV@ntage valued at over $1,000:
Ü Review of your business and the potential impact of CRM Ü Identify your readiness and ROI opportunity Ü Key Factors to consider when implementing your CRM Solution
See our special offers section or click here to send an information request directly.
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Joe Facchini is an independent consultant providing e-productivity services to help you build stronger customer relationships. He combines 25 years of practical sales management, marketing and application development experience with today’s information technology products to bring Small and Medium Business affordable solutions to customer focused business problems.
He can be reached at 416-281-5429 or Contact@VirtualVantage.ca. VirtualV@ntage looks forward to serving your business needs.
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