CRM Winners and Losers

CRM Buyer Sentiment and The Messaging Delta Between Vendors & Customers

I’ve always been interested in how the more successful CRM vendors craft and amplify their messaging, and how that messaging resonates with CRM buyers. I’ve been tabulating and trending data points to bring some measurability to this fascination for some time. I’ve also been sharing and analyzing the results with several CRM vendors, and now I thought I would share some of the findings with the broader community.

I use an outsourced contact center to survey inbound visitors at CRMsearch.com. They target CRM buyers (initially determined by their content consumption) and engage about 1% of the visitors per day for a few days or until we have 300 or more responses.

Each survey starts with three initial questions: i) What CRM system are you using today? ii) What new system(s) are you looking at and why? and iii) What are your top buy criteria? Based on these responses, we generally ask 2 additional questions which vary. The results are telling. We can identify top buyer criteria by target segment and understand which vendors’ messaging is most resonating with the most buyers.

Because the survey consists solely of inbound visitors, it’s not exactly empirical but nonetheless delivers a relatively consistent and convincing buyer centric view of CRM products. Later this year I plan to compare the quarterly results and trends with subsequent earnings announcements to see if a correlation exists, but that’s down the road.

Also, this chart is not a CRM market share report. It’s measuring absolute buyer opportunities, not revenue potential. It shares the volume of buyers considering any particular CRM software solution on a quarterly basis. Because there are far more SMBs than there are enterprise companies, the volume of CRM buyers seeking enterprise solutions will be much less than the volume of buyers seeking SMB solutions. Trending the results quarterly shows which CRM vendors are outperforming or underperforming relative to the competitive landscape in terms of demand generation and alignment between vendor messaging and customer buy criterion.

I track the top 40 CRM systems by month, but for purposes of this blog post I’ll share the top 15 CRM systems by quarter, and limit my analysis points to just a few.

CRM Buyer Mindshare Index

N=306. All participants self-identified as buyers of CRM software.

On The Rise

Infusionsoft

This company is the one to watch right now. There was a small spike in March which I suspect may have been related to the InfusionCon conference. More so though, Infusionsoft’s recent $54M venture placement and near insatiable appetite for marketing and promotion is having a clear effect in the marketplace. But more importantly, the promotional spend is not just achieving increased reach, but also impressively consistent messaging that’s resonating with prospects.

The message most repeated by CRM buyers considering Infusionsoft was “all in one CRM” (or words very close to that effect), and it’s a message that is resonating very well as shown by a .52 density coefficient (meaning that over half the prospects considering Infusionsoft cited that messaging as part of their top buy criteria). It’s pretty typical that when half or more of potential CRM buyers coalesce around a common message, buyer interest is high, and we see that with an Infusionsoft average buyer interest of HIGH. It’s quite clear that this company isn’t chasing individual leads, but that volumes of leads are coming to them.

Oracle RightNow

Despite some transition related to RightNow being positioned under an Oracle banner, which generally creates a noticeable change in buyer demand, RightNow is keeping its pace and showing a messaging density coefficient that most marketers only dream of. Nearly 6 in 10 CRM buyers repeated the keyword of “cloud customer support” (or keywords very close to that effect) and possibly more impressive, buyers considering RightNow were generally only considering 2.3 (on average) CRM solutions in total. I don’t think there can be much doubt this is why RightNow achieves such a high sales win rate.

On The Decline

SugarCRM

There was a day not that long ago where SugarCRM’s trajectory suggested the company would secure the position immediately behind the Big 4 CRM (Salesforce.com, SAP, Oracle and Microsoft) and ahead of the remaining top 10. However that day may have passed. Buyer demand for Sugar CRM remains positive, but less positive than many competitors who are clearly catching or passing Sugar. Sugar continues to show strong business results, primarily because its hybrid sales model of a strong direct sales force and an impressive partner channel perform well. Further, the CRM software continues to evolve and is clearly a very competitive solution.

So what gives? Well if you consider my belief that market winners assemble the best combination of people, product and promotion, Sugar is in decline when it comes to people and promotion. It’s an interesting mix on the people front as the company’s C-suite is one of the most impressive in the software technology industry, but when you get deeper in the company the results are mixed. On the promotion front, Sugar’s efforts are simply ineffective when based on CRM buy criteria and what CRM buyers recognize of the company. The low message density shows that there is no recognized message by buyers about the company. Buyers do frequently reference the keyword “open source”, but interestingly that factor was not included in the top 3 decision making criterion for those buyers. For Sugar to increase its brand and buyer affinity it would seem well advised to align its messaging with criteria buyers use in their decision making process, in addition to amplifying its messaging. Also, for Sugar to really gauge its competitiveness, it needs to look at not just its own business performance, but how that performance compares with the competitive landscape. CRM is a growth market, so most everybody is growing and the winners are growing faster than the average. Sugar is growing, but has now been passed by Infusionsoft and Zoho and there are a host of vendors (Avidian, BPM Online, Cegedim, Infor, Kana, Maximizer, OnContact and Pega) that are climbing slightly faster than Sugar.

SalesLogix

Sage SalesLogix has always been a steady performer, however, has recently shown some decline. I suspect this is the result of some uncertainty and/or reduced promotion in the period leading up to the divestiture of ACT! and SalesLogix to Swiftpage in February. Because of this one time event, I’m going to defer any analysis points at this time. It will be interesting to see how SalesLogix performs in the next quarterly update.

There’s a lot of additional interesting analysis and take-away points, especially when you see applications like Siebel still making the top 15 list, but I’ll save these points for another post.