For years, we have been talking about the value of CRM for small business. Yet, we the pundits of whatever, always have been publicly puzzled by what we thought was the slowness of small businesses to adopt CRM. How dare they buck the trend that we were declaring!
Admittedly, what we were talking about was more technology than strategy in their case, where when it came to the enterprise, it was more strategy than technology. That we were talking about, not what they were doing.
In any case, now CRM is being adopted by small business faster than Cool Papa Bell going to bed at night. (For those of you who have no idea what the hell I'm talking about, this is a reference to Cool Papa Bell, a great Negro Leagues baseball star who was so fast that, according to another Negro Leagues baseball star, Josh Gibson or Satchel Paige, depending on where you read it, "he could get out of bed, turn out the lights across the room, and be back under the covers before the lights went out." Dell Cloud Business Applications and Techaisle did a study on the adoption of Cloud Applications by SMBs and, not only did they find adoption of all cloud apps on the rise by small businesses, they found CRM was by far the most adopted, up from 34% in 2010 to 55% in 2012, suggesting (at least to them) that CRM was the gateway to other cloud apps.
There is no doubt in my mind that the growing ubiquity of cloud based technology, which brings down the price of even SaaS-based CRM, is a big part of the reason that CRM technology is finally on the rise with small business. It's now affordable with technology choices ranging from free to not much more than that.
What makes CRM even more attractive to small business is the so-called consumerization of IT. While this concept is typically discussed when enterprise IT departments are being hammered or someone is commenting on the accession of lines of business to the technology budget throne, it does apply to small business but in a different way.
Think of it in these terms. If I ask ANY audience that I deal with - whether dominated by small business, midsized or enterprise endeavors, the questions - how many of you are on some sort of social network and how many of you have a mobile device that you're constantly looking at, the low end "yes" to both questions is probably somewhere north of 90%. What that means is that people whether they are wearing their hats as small business owners or vacationers with their families, are not only familiar with the use of contemporary technology, they depend on it. Factor in that small business owners are closer to all facets of their business than someone who is in a large enough environment to be siloed into a department. What becomes apparent as they grow (or even if they don't) is two things. They need some sort of technology to enable what they do because it would be more effective to have it AND the "old school" methods like pen and paper or even Excel spreadsheets either aren't necessary, nor useful, nor are they convenient either. The CRM technology is so inexpensive and so readily available as to be a convenient choice even to the extent of "why not" when asked "why are you using or thinking of using CRM" small business owner.
As I've seen over the past several weeks, once they adopt it, they arguably love it - or at least get to a level of enthusiasm that you rarely see in a CRM practitioner at the enterprise level - unless its salesforce.com. More on that later.
Now, let me be clear, in one of the great ironies, at least of my life as a small business owner, I don't use CRM software. For a simple reason. I'm a one-person business with a simple business model and thus, I don't need it. Gasp, how could you, Paul Greenberg, you hypocrite?!!? Easy. I don't have to eat my own dog food, if I'm not a dog.
But there are countless businesses of one or two who do use CRM software (note, I'm not calling ACT! CRM though they do approach it more and more each year. They are still contact management). AND there is CRM software that is aimed squarely at even this tiny sized segment. Companies like Zoho, have multiple companies of that size that use their CRM applications as the gateway - thanks Dell - for the use of multiple other of their applications. For example, Zoho has 25,000 companies using their CRM software and 100,000 users with the largest deployment around 3000 meaning, really small companies with a high volume deployment.
This doesn't mean that small business CRM is small business. In fact, it's becoming a highly targeted segment by the major players too. All four of the Big Four - Oracle, Microsoft, SAP and salesforce.com have small business units that provide small business services and applications. In fact, salesforce.com's acquisition of CRM Idol 2011 finalist Assistly last November, now rebranded as desk.com, in combination with their do.cominitiative is a serious effort to get back to the segment that they began their life with. Microsoft, while shifting their focus to the enterprise, is by no means abandoning the small business market. SMB specialists like Infusionsoft have managed to turn small business into a substantial revenue stream with 2011 numbers around $32 million. There are dozens of mature technology providers who are focused on small business and have been for years like Avidian, who's Outlook-integrated product, Prophet, has been a fairly popular flagship for years despite a lack of buzz. What about buzz creating Social CRM newcomer Nimble, run by Goldmine founder and industry veteran Jon Ferrara with over three hundred value added resellers (VARs)? There are even small business focused social media monitoring tools like Sprout Social. There are long established players who attack the upper end of the small business market like Sage Software, the owners of the aforementioned ACT! but also their CRM products, SageCRM and old-timer but still solid SalesLogix. There is no dearth of technology providers for customer facing activities - the vast majority of whom are small businesses themselves.
What fascinates me about this market isn't its potential for CRM - all markets with customers have potential for CRM but that even though small business owners have been slow to embrace it, once they do they really, really do. The enthusiasm for CRM that I've seen from this crowd generally exceeds anything I've seen from an enterprise gathering.
What do I mean?
Time to get anecdotal on you.
So my experience has been kind of big bash oriented with huge company CEOs paraded out on the stages as the trophy clients of the enterprise software companies. The conversations between the moderator - usually a senior management person from the vendor and the trophy CEO is one of big data, large scale deployment, sexy uses, and highly differentiable offerings. NEVER is there a discussion of the incremental improvements that are characterized by revenue increases, customer acquisition increases, renewals, percentages of lead conversion, etc.
But in the last few weeks, I've had the opportunity to be the keynote speaker at the very first Zoho User Conference Zoholics, and to be part of a "performance" by me and Brent Leary - a live episode of our always absolutely-the-coolest-thing-ever (for me) CRM Playaz on stage at the Infusionsoft 4th annual InfusionCon in Phoenix Arizona.
Rather than go over what I did there, I want to discuss the nature of each of these and some of what I found out.
They were quite different.
Zoho CRM is actually a well-constructed product, focused on sales force automation. Priced at first three users free and $12-$25/user/month after the 3rd; it is a fairly complete small business focused sales application with contact, account, opportunity management all part of it and with some pipeline management and dashboards to support the reporting that the technology offers. They've recently made their customer service application more robust with the addition of Twitter and Facebook integration. Their marketing capabilities geared to email marketing, though they do integrate it directly with sales, in alignment with current thinking on sales and marketing. However, for SFA and customer service, primarily, it is as solid a simple offering for small business as exists on the market. It is also, according to CEO Sridhar Vembu, their best selling product.
Its success is measured by the 25,000 businesses that use Zoho CRM, some of whom attended the conference. What was interesting here was the muted but still buzzworthy excitement of the Zoho customers in being there. It was almost like a family gathering with customers who knew other customers; with the Zoho senior management palling around with the attendees. Clearly Zoho took input from its customers to heart and was able to implement a lot of the requests that the customers had for the product. The Zoho partners there were more development partners - ISVs who also sold the product than they were traditional VARs. Not surprising, since at its heart, Zoho is an engineering company.
The conference itself was incredibly well managed thanks to the work of the team around Ramon Ray, who is not only an event-planning star, but a leading influencer in the small business community.
Which points to another distinct difference with the enterprise.
There is an identifiable small business community - the same way you can identify a CRM community - that is distinct from CRM or other small business related technology. Instead, its focused around opportunities and strategies and programs for supporting small businesses. There are small business influencers like Ramon Ray or Anita Campbell who have followings numbering in the tens to hundreds of thousands who run media properties like smallbiztechnology.com to fulfill the needs of that small business community.
What's so special about this? Tell me, where can you find an "enterprise community?" The same place you can find an ERP community and the ships that disappeared in the Bermuda Triangle - nowhere. To be fair, you can find vertically specific associations that serve large businesses - but its not the same by any means in spirit, purpose or participation and culture.
The Zoholics conference was characterized not by the CRM community participation per se - the lack of significant influencers from that space, beyond me and fellow Enterprise Irregular, the terrific Zoli Erdos, was kind of sad, actually. But what you did have was the Zoho customers shaved from the small business community - the very same folks who would be reading smallbiztechnology.com posts and articles. Those who would be following CRM SMB thought leader Brent Leary, and SMB guru Anita Campbell.
The Zoho conference was geared to the "how to use Zoho" tracks and even the other speeches beyond mine were, more or less, tactical in nature if you want to give it a formal caste. Meaning, this is how you do it, people, whatever "it" may be. The discussions were spirited, though a bit muted and the focus was around relatively creative uses of Zoho. But it was clearly small business and the enterprise was nowhere in focus.
Zoho CRM makes no claim to be something that someday will go upmarket to even the midmarket. It simply is there to serve a constituency of small business owners and the conference, first ever, proved that.
That doesn't mean that because they focus on small business, they want to stay one. Again, own dog food.... They have a long way to go to be a major player but they serve what they do currently well. Throw in serious analyst relations, work more toward market impact, show that your products can serve a high volume of customers, since enterprise seats isn't the objective, and the increased impact will come. But, at least at their first ever conference, the presence of a small business community, a slice that attended to learn more Zoho stuff, was palpable.
If I have to choose, there are four things that characterize Infusionsoft.
I'm impressed by the quality of Infusionsoft as a company, their product, their leadership and their customer base. It is a testament to what can be done with the small business market if the time and effort is put into it.
Is there much market opportunity? Yes there is provided the providers understand that the way they are going to sell is not what the CRM market, focused on the enterprise historically, has been. It is going to be high volumes of customers with small numbers of users providing subscription based fees (price/user/month) and, thus recurring revenue. Hey, Infusionsoft has $32 million to prove it works and Zoho has 25,000 customers. Not bad.
These are representative examples of the CRM related offerings out there in the small business world. There are hundreds of others - some not here simply because my fingers are tired of typing, some because I don't know them, and some because I'm leaving them to the leading small business CRM guru in the world to present to you. That would be Brent Leary who is now in the process of deciding on the winners of his 2012 CRMish Awards, a highly selective award for the best CRM technologies for small business. Check out his upcoming post on Wednesday. I'm honored to say that Brent will be presenting these awards (non-exclusively) on this blog sometime soon.
The ones that neither he nor I know have a huge opportunity now to become known if they have any sense and any desire to get somewhere with their products. We are now in the midst of season 2 of CRM Idol which is designed for small emerging CRM(ish) companies to get visibility, coaching, reviews, access to influencers and win some serious prizes. ANY company who complains about or wonders about their ability to get "seen" has ZERO excuse if they didn't apply for CRM Idol 2012 (the submission final date was May 25). If you want to see who did take the plunge, go to the CRM Idol 2012 website on or around June 1 and take a gander. If you want to see what happened last year, go here and you can look it over. What I would do if you are a small business CRM vendor is sign up for the CRM Idol community, which you can do whether or not you're a contestant. You'll get some of that exposure.
And that's a great thing.
Though, I'm still not going to use any of it.