Download the full report: http://www.gleanster.com/reports/reports/crm-for-small-and-midsize-businesses Over the last decade, Customer Relationship Management (CRM) platforms have matured, and their adoption has become widespread at not only larger enterprise companies but also small and midsize businesses (SMBs). Driving this growth is the fact that CRM platforms are now able to fully automate all types of interactions and transactions, including sales processing and order fulfillment, between companies and their customers. For Top Performing organizations CRM has become a hub for centralizing customer engagement and outreach. Most CRM solutions integrate with stand-alone solutions like email, marketing automation, or eCommerce. But, over the last 10 years, comprehensive CRM platforms have become more accessible for the small business. These systems are designed to strike just the right balance between simplicity and value; with the understanding that CRM is mainly valuable if it streamlines the sales cycle and lifts sales. Of course successful implementation isn’t just about technology. As this Gleansight benchmark report will show, superior performance is defined by automating relevant engagement with customers and prospects; CRM is the lifeblood of this engagement. In fact, Top Performing small businesses reveal proactive engagement with customers was a top two reason to invest in CRM. The report includes a comprehensive vendor landscape with vendor rankings based on 4 dimensions – Ease of Deployment, Ease of Use, Features and Functions, & Overall Value. Plus, the vendor rankings are developed using actual customer experiences with vendors.

1. Q4 2012
Gleansight
CRM for Small and Midsize Businesses
Content Over the last decade, Customer Relationship Management (CRM)
platforms have matured, and their adoption has become widespread at not
Part 1: Topic Overview only larger enterprise companies but also small and midsize businesses
Part 2: Reasons to Implement
Part 3: Value Drivers
(SMBs). Driving this growth is the fact that CRM platforms are now able
Part 4: Challenges to fully automate all types of interactions and transactions, including sales
Part 5: Performance Metrics processing and order fulfillment, between companies and their customers.
Part 6: Success Story
Part 7: Vendor Landscape
Sidebars
Survey Stats
Benchmark KPIs
Industry Buzz Words
Keep in Mind
Gleanster Numbers
Vendor Quick Reference Guide
Small and midsize businesses may never have shunned CRM outright, even after
hearing the sob stories of large enterprises that purchased CRM software that
subsequently performed poorly. However, only a relatively small segment of the
SMB marketplace had considered adopting CRM until recent years. That has now
changed, and the right technology choices can produce enormous benefits not
only for the business adopters but also for their customers. The growing popularity
of software-as-a-service offerings and the comprehensiveness of solutions have
ultimately made CRM a compelling, low-risk option for small businesses. In the
fast paced dynamic small business operation, individual contributors are an army
of one, often supporting all facets of customer engagement; from marketing, to
sales, to customer service. That demands tools that are both easy to use, but also
comprehensive and affordable.
For Top Performing organizations CRM has become a hub for centralizing customer
engagement and outreach. Most CRM solutions integrate with stand-alone
solutions like email, marketing automation, or eCommerce. But, over the last 10
years, comprehensive CRM platforms have become more accessible for the small
business. These systems are designed to strike just the right balance between
simplicity and value; with the understanding that CRM is mainly valuable if it
streamlines the sales cycle and lifts sales. Of course successful implementation
isn’t just about technology. As this Gleansight benchmark report will show, superior
performance is defined by automating relevant engagement with customers and
Note: This document is intended for individual prospects; CRM is the lifeblood of this engagement. In fact, Top Performing small
use. Electronic distribution via email or by post- businesses reveal proactive engagement with customers was a top two reason to
ing on a personal website is in violation of the
terms of use. invest in CRM.
Entire content © 2012 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction is prohibited.

2. Gleansight: CRM for Small and Midsize Businesses 2
Survey Stats
The research findings featured in this
Part 1: Topic Overview
Gleansight benchmark report are
derived from the Q3 2012 Gleanster Many companies have improved their customer service processes,
survey on smal business CRM. marketing forecasting, and returns on marketing spending through the
• Total survey responses: 318 use of CRM software. For small and midsize businesses, the tools are
continuously evolving through customization options from long-time
• Qualified survey responses: 215 solutions providers and new market entries that focus on select verticals.
• Company size: <$1M (48%); $1 Initially, commercial CRM tools were system more flexible. That has enabled
- 10M (18%); $10-100M (34%) only available as software packages data collection and aggregation across
installed on users’ hardware—typically corporate functions because CRM is not
• Geography: North America (82%); a centralized database with individual merely a technology but also a business
Europe (17%); Other (1%) PC clients. The upfront purchase solution. Now many CRM providers
and implementation price required enable user-friendly mobile interfaces
• Industries: Consumer Goods C-suite sign-off and significant budget too, so CRM data is a password away
(23%); Retail (21%); eCommerce for maintenance and growth, either no matter which device a user has
(9%); Manufacturing (6%); Software by in-house staff or outsourced handy. This evolution has kept CRM
(6%); Technology (5%) Financial consultants. Where companies tried viable. Had on-premise software
Services (4%); Business Services to cut corners, they lost ground, with packages not given way to SaaS, CRM
(4%); Non-Profit (4%); Other (12%) data accumulating but poorly used and would be an ill-fitting legacy system at
information siloed in the IT, marketing, only the largest corporations rather than
• Job levels: CEO / Owner (31%); or customer service function rather than a must-have for most companies.
C-level (25%); Director (34%); leveraged enterprise-wide.
Manager & Staff (10%) CRM tools have also become more
Today CRM platforms have moved to customizable, but customization needs
cloud-based delivery systems, giving that develop as an organization absorbs
Sample survey respondents: even the smallest businesses—even the value and potential of a CRM system
sole proprietorships—the ability can convert the previously low-cost
Director, Anton Systems
to optimize their customer data for on-demand solution to a high-cost
Owner, The Trainers maximum lifetime value and long-term investment.
relationship retention.
Manager, Dollar Bank CRM still has a mixed reputation,
To expand the market for CRM to small delivering successes as well as
Director, The Maple Group and mid-size businesses, solution stumbling blocks. It may be that the
providers offer access to their CRM
Director, Silver Fern Security
convenience and affordability of
“on demand,” via a hosted model that
cloud-based CRM deserves some
typically requires no upfront investment
VP, Yellow Admiral of the blame; user engagement can
but is paid for by monthly subscription
be lacking in the absence of the
VP, Helen Brett
“per seat.” “Software as a Service”
pressure associated with a huge
(SaaS) is lumped into cloud-based
capital expenditure. Additionally, the
Owner, Sign Language LTD computing in which users log into
implementation of a CRM solution is
a solution on the provider’s server.
most successful when the solution
Owner, NorthDoor The CRM client’s database is hosted
offsite with the CRM sponsor as well. is integrated with other software
The evolution is good business for systems and databases in use at a
CRM vendors and good fortune for company—a task easier said than done.
companies still making CRM start-up Nevertheless, having a CRM platform
decisions. On-demand service gives of some sort has arguably become
organizations a low-cost entry point as necessary as having a financial
to demonstrate the value of a CRM reporting tool. Sarbanes-Oxley alone
investment to management. has moved CRM from a luxury to a
vital tool to enable and support broader
Note: This document is intended for individual
use. Electronic distribution via email or by post- This model has not only welcomed growth strategies. The marketing
ing on a personal website is in violation of the more companies with limited budgets as resource management applications in
terms of use.
CRM adopters, but made access to the CRM systems show particular value.
Entire content © 2012 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction is prohibited.

3. Gleansight: CRM for Small and Midsize Businesses 3
Part 2: Reasons to Implement
Benchmark KPIs CRM implementations are driven by companies’ desire to improve both
Gleanster uses 2-3 key performance business processes and individual performance. In all cases, the key is
indicators (KPIs) to distinguish “Top
organizing a tremendous amount of ever-changing information across
Performers” from all other companies
(“Everyone Else”) within a given data thousands or even millions of interactions between the company and its
set, thereby establishing a basis customers or prospects. The expectation is “what you can measure, you
for benchmarking best practices.
can manage.” Specifically, companies believe—and many successful
By definition, Top Performers are
comprised of the top quartile of CRM implementations have proved—that recording, analyzing, and
qualified survey respondents (QSRs). more closely managing customer and sales prospect relationships is
an effective way to derive more value from these relationships and the
The KPIs used for distinguishing
Top Performers focus on effort and resources being expended to build and maintain them.
performance metrics that speak
to year-over-year improvement in
81% 68% 84% 92%
**
relevant, measurable areas. Not
all KPIs are weighted equally. Most
The KPIs used for this Gleansight are: Compelling
• Revenue Growth
Reasons to
Implement*
• Employee Satisfaction with CRM Affect custom targeting for Proactively communicate Establish data-based
sales and marketing efforts with customers metrics for marketing/sales
efforts
To learn more about Gleanster’s **According to Top Performers, based on 285 Qualified Survey Responses to the Q2 2012 Gleanster survey on WCM CRM
based on 215 Qualified Survey Responses to the Q3 2012 Gleanster survey on SMB
According to Top Performers,
research methodology, please click ** According to Everyone Else, shown only when a notable disparity occurs relative to Top Performers
here or email research@gleanster.com.
Establish data-based metrics for segment profit. Marketing dollars are
marketing/sales efforts. With C-level being redirected from a very generic
executives, CFOs in particular, taking approach to marketing mix optimization
a greater interest in their organizations’ by channel.
investments, pressure for return on
investment (ROI) numbers hits the Proactively communicate with
usual functions—production, sales, customers. There’s no doubt that
human resources, and information marketing is under pressure to
technology—and marketing, which is personalize its message to win new
being held to more accountability for sales. CRM enables a marketing
its spending. Because of this executive evolution—assessment to strategy
involvement in decision-making, CRM to select contact based on customer
solutions need to show a measurable, if service interactions, recent latency in
not quick, ROI. brand engagement, observed or shared
preferences, and more.
The key metrics in focus—because
they’re obvious and they get immediate In the rapid pace of the small business
benefits—are customer cross-sell and environment, it’s challenging for
upsell; customer retention; customer businesses to stay on top of cusotmer
acquisition (how fast, how many, and engagement, particularly with
in what segments); channel profit; and ever increasing demands for more
Note: This document is intended for individual personalized customer engagements.
use. Electronic distribution via email or by post-
ing on a personal website is in violation of the
terms of use.
Entire content © 2012 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction is prohibited.

4. Gleansight: CRM for Small and Midsize Businesses 4
42% 55% 62%
Industry Buzz Words
Compelling
Here’s a list of key terms you Reasons to
should know be familiar with in
the context of this research: Implement*
Small-to-Midsize Business (SMB).
Not all analyst firms and companies Integrate disparate Improve quality of data Streamline/enhance the
data sources/enhance efficiency of customer
classify SMB in the same way. For accessibility to data service/communications
the purpose of the analysis in this **According to Top Performers, based on 196 Qualified Survey Responses to the Q3 2011 Gleanster survey on WCM CRM
According to Top Performers, based on 215 Qualified Survey Responses to the Q3 2012 Gleanster survey on SMB
report, SMB is sub-divided into ** According to Everyone Else, shown only when a notable disparity occurs relative to Top Performers
Very Small (up to $1M annual sales),
Small ($1-$10M in annual sales), and
CRM can help mitigate some of these data is pertinent came much later. Data
Medium / Midsize ($10M - $100M in challenges by centralizing data that exploitation through CRM tools aims
annual sales). Respondents could can be used to automate business to lend a business greater efficiency,
also be classified as SMB by the rules or trigger alerts to maximize the encourage smarter spending, increase
number of employees which ranged timeliness and relevance of customer customer knowledge, and improve
from 1-750 employees on average. communications. product positioning and development.
Ignoring the unnecessary will yield
On-Premise CRM. On-Premise CRM Enable custom targeting for sales higher quality measures and outcomes.
is typcially hosted and maintained and marketing efforts. More flexible
on physical hardware owned and customizable CRM applications Integrate disparate data sources/
and maintained by the customer. integrate better into middleware enhance accessibility of data. Efforts
On-Premise CRM is typically a and business process management to make CRM more accessible include
desirable choice when a company hubs and allow the business user uniting customer data across different
wants total control over the data in the to customize the user experience, systems and applications both within
system and/or custom integration to improving productivity. Companies are an organization and with its vendors.
other ERP or back-office systems. Over realizing that their salesforce and sales Customer data integration and real-time
time, the licensing costs associated
channels are strategic competitive analytics make many scowling senior
with on-premise solutions (especially
weapons and that CRM can be used to executives pat themselves on the back
when licensing is not calculated on
a per user basis) can be significantly
make them more effective. for approving CRM investments.
lower than on-demand fees.
Streamline/enhance the efficiency of Set focus on providing solutions
customer service/communications. to customer needs rather than
On-Demand CRM. On-Demand or
Targeted communications inspired by selling products / services. CRM
Software-as-a-Service (SaaS) CRM
CRM data and initiated through the implementation creates value for the
is accessible over the internet and
hosted and maintained by the solution
CRM solution’s automated marketing customer by empowering front-line
provider. SaaS solutions are typically tools can reduce service costs and, salespeople with information on
lighter in features, which often aids in best case scenarios, increase customers’ existing relationships with
in the adoption. Low implementation profitability. For the small business, the business and analytics that predict
costs and speed of implementation revenue is generated through intimate ancillary needs and the products or
make On-Demand CRM a compelling relationships with customers, so a services that can meet those needs.
turnkey solution. There are two types centralized system of record for all Representatives can see the connection
of on-demand solutions. The first, customer interactions over time is between a customer’s current
multi-tenant, represents a single paramount to repeat business. relationships and the products the CRM
software instance whereby multiple
system recommends selling next. This
clients (tenants) leverage the same Improve quality of data. Most means they sell more enthusiastically,
solution. In a multi-tenant delivery businesses began collecting data in and customers likely engage with new
model, updates to the software earnest when technology—Microsoft products more readily because they,
Excel, legitimate database software, or too, understand the relationship-building
Note: This document is intended for individual simply email contact lists—made the approach.
use. Electronic distribution via email or by post-
ing on a personal website is in violation of the previously manual process of recording
terms of use. data easier. Prescriptions as to what
Entire content © 2012 Gleanster, LLC. All rights reserved. Unauthorized use or reproduction is prohibited.