Is Salesforce Overpriced?
By: Gene Marks
Tags: Salesforce, Forbes, CRM, Technology

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My company implements both Salesforce and Zoho CRM, among a few other customer relationship managment applications. Our market is mostly small and mid-sized businesses. There is this perception among these companies that Salesforce is much more expensive than many of the other CRMs for the small business market. So, is it? Is Salesforce overpriced?

It depends.

For starters, it depends on what you want from your CRM system. If you just want simple contact management for a relatively small workgroup then Salesforce Essentials — it’s lowest price product at $25 per user per month for up to 10 users — is perfectly fine. Other CRMs may come in a few dollars less or more, but for the most part it’s competitively priced and does position you to scale if your company grows.

And let’s not pretend that, for most small businesses, CRM is pretty much about contact management. It’s about having a solid, accurate, complete database of contacts and companies that’s tied into email and calendaring for follow-ups and history tracking. Most of my smaller clients — heck, even many of our larger clients — can’t even accomplish that much. So don’t underestimate the difficulty of getting this right, and the value of having a great contact database.

At the next level up, Salesforce starts to get pricier. Its Professional version is priced at $75 per month per user and pretty much has the same features and functionality as Zoho CRM (and others) where the pricing can be half as much. And even with the Professional version, you’re missing out on more advanced features like unlimited customizations, full permissions, workflows and automations and integrations. So if you’re a smaller company that desires those things — and many do — then you’re going to have to pay a lot more for Salesforce than many of its competitors.

To get all of those features you have to subscribe to Salesforce’s Enterprise version which the company says is it’s “most popular” version. I can certainly understand why Salesforce wants you to believe that. At $150 per month per user it’s a nice revenue stream for the CRM provider. And it gives its users all the bells and whistles. But for most small and mid-sized companies that’s a pretty steep price to pay, particularly when you get most of these features with a CRM like Zoho or others like it.

Then there are other considerations that will impact your Salesforce pricing. Add-ins for doing marketing, service and integrations to other applications like accounting are extra monthly fees. Storage costs can rise based on usage. And, unless you’re ready to outsource your implementation to a team in India, Salesforce implementation partners (particularly in the U.S.) tend to charge much higher fees.

But keep one thing in mind: with Salesforce you get what you pay for. Salesforce is like the BMW of CRM. It has the largest market share by far and its high reputation is deserved. Whenever I encounter a company unhappy with Salesforce it’s almost always because it wasn’t implemented the right way (or the company is only using a fraction of what it offers). You’re never going to get fired for choosing Salesforce.

What you also get with Salesforce is a very strong and passionate community. You get a worldwide network of very experienced and talented partners. You get a seemingly unlimited amount of online training resources and tools. You get a much larger choice of products that will integrate with it. You also will enjoy a high level of customer support that you’d expect from a company that services some of the world’s largest brands. Smaller CRM makers like Zoho oftentimes are challenged to match this. As an example, Zoho’s support (which is mostly out of India) never fails to underwhelm me and my clients. Maybe that’s why their application costs so much less?

Again, you get what you pay for.

Salesforce is clearly a great solution for larger enterprises, particularly when those companies dedicate the right amount of resources — both internal and external — for getting it setup, implemented and adopted by users. It’s also a great solution for smaller businesses too. But the same rules apply: a significant investment is needed. But if that commitment is made, then it may be worth it.

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