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There is something wrong with the CRM marketplace today.  Frankly, it’s getting left behind in the face of social networks.  The focus today is on social networks.  If that’s where the customers are, then eventually that’s where the business will be.  What does that mean for CRM?  Let’s first look at the world of today’s relationship management applications.

CRM is Vastly Under Penetrated

Facebook has 800 million users today. That means 800 million people (1/10thof the world’s population) are using Facebook to manage their personal relationships.  150 million business professionals use LinkedIn to manage their business relationships.  That’s a lot of people.

However, do you know how many people are using CRM tools to manage their customer relationships?  About 15 million total across all applications.  That means if you combine all of the users across SugarCRM, Salesforce.com, Oracle, SAP, Act! and all the others, you have only 15 million sales, marketing and customer service professionals interacting and collaborating with their customers with CRM applications.  Compared to 150 million on LinkedIn alone.  Hmm, something is wrong here.

And here’s the simple truth of it.  After 20 years as a software category, CRM solutions are mostly a reporting tool for management at large, enterprise companies.  Smaller companies have mostly avoided CRM apps because they have been too expensive, too complex and not helpful for the average user.

How Big Should the CRM Market Be?

So if Facebook has 800 million users, LinkedIn has 150 million users and CRM as an application category has only 20 million, how many people should be using CRM today?  That’s actually pretty easy answer to find.  Look at what they are using now.  Email.

Research reports show that there are three billion email users in the world today and 25% of all email usage is in the corporate setting.  That means 750 million people globally are using the most basic of collaboration technology (i.e. email) at work to share ideas, communicate status, and ask for help and much, much more.

Now let’s say half of those workers are customer facing.  This is just a swag as that number is going to be different across different industries.  For instance, the manufacturing industry probably has something more like 10% of its workforce interacting with customers.  Whereas the financial services industry has a percentage likely closer to 100%.  But let’s just take a simple number, 50% of all corporate email users, as interacting with customers over email.  That means 375 million people globally are using email today to solve customers’ problems when they could (should?) be using a CRM application.

The challenge for the CRM industry is to turn 360 million people who rely on email (and spreadsheets) to work with their customers into CRM users.  Fanatic CRM users.   Loyal CRM users.  The kind of customers every company wants.

And that’s what SugarCRM is focused on.  Growing the CRM marketplace by 25x.  Turning a stagnant, under penetrated market into the fastest growing software market segment.  Turning 15 million users into 375 million users.

The Solution is “CRM Made Simple”

How will we create 360 million new users? As is usually the case with big problems, the answer is simple but will take a lot of work.  At SugarCRM, we are focused on delivering simple, easy-to-use CRM solutions that help users first and management second.  We are delivering this solution through a worldwide network of local value added resellers who know you and know your business.  Along the way, we will create a partnership with you (the best kind of customer/vendor relationship there is) by being completely open, transparent and trustworthy in how we solve your CRM problems.  We will earn your business every day and in return, we simply ask that you spread the SugarCRM word to your colleagues and friends.  That’s CRM made simple.

Yeah, it’s a big goal.  It might even be audacious.  But that’s why we do what we do.  We’re here to create successful customers and have some fun at it.

–Clint

When I think of great customer relationship management (CRM), I think first of customer service. In a global marketplace that brings you incredible brands like Amazon.com and Coca Cola or fantastic products like the iPhone and Lexus GS (I own them both), your products alone don’t set you apart from your competitors any more. The way you treat your customers, the relationship you build with your customers is what sets you apart from your competition. In today’s information overload world, customer service is marketing. Just ask Zappos or Rackspace. It’s in their logo!

In the early 90’s I studied for a year at the University of Heidelberg. My lifeline back to home in California was the local Deutsche Bank office where my parents wired me funds every month. I remember that bank office fondly, not just because that was where I picked up my bar money each month. I remember how friendly the bank tellers and the bank manager were. Even though as a university student I had very little money, they always treated me like their most important client. From greeting me by name at the door (it was a small branch), to thanking me for my business that day to wishing me well as I left, great customer service was clearly the mantra of that branch office.

Years later after starting my own business, I have learned that great customer service doesn’t just happen by accident. It’s a philosophy that must be part of a company’s culture. Managers must be relentless in demanding it, employees need to be enthusiastic in delivering it and your customers will quietly smile and come to expect it.

I have found that the philosophy behind great customer service is a simple one. I call it the “Golden Rule of Customer Service”. Treat your customers the way you would like to be treated.

We all enjoy and appreciate it when we are treated well and get the product we are looking for. Certainly if a company can deliver great service with a smile, it will earn my continued business quickly. If the company can consistently deliver high quality service and high quality products, I will become that company’s loyal fan and recommend them to everybody I know.

At this year’s SugarCon on April 23-24 in San Francisco, you will learn all of the latest tips, tricks, techniques and tools for treating customers they way you would like to be treated and how to create a legion of loyal fans. Join us for the fun and you will walk away with the knowledge you need to accelerate and grow your business.

–Clint

Why Open Source?

Clint Oram —  April 18, 2012 — Leave a comment

I’m often asked why we chose to build a commercial open source company. “Why open source?” is a frequent question as customers and partners seek to find out what makes SugarCRM tick. The answer is that we didn’t choose “open source”, rather we chose “open”.

In 2004, when we started, you may remember that there was a massive customer backlash in the software world to closed, proprietary, dishonest software company practices that locked customers into expensive solutions that didn’t really solve their problems. We wanted to build a different type of software company.

Open source projects were radically changing the face of software development at the time. Open source projects build products hand-in-hand with users around easy-to-evolve source code in a free, open, transparent, hyper-collaborative way. Today that’s called crowdsourcing. In the past, it was called open source. At SugarCRM, we wanted to create a company that embraced the same ideals and techniques of open source projects. We wanted to build an open company that builds open source software and collaborates with its customers and partners in an open way.

So the real question in there is not “Why open source?”, but rather “Why open?” And the answer to that question is at the core of SugarCRM. The purpose of SugarCRM as a company is to create wildly successful customers. The way you create customers is to solve their problems. Now, solving a customer’s problems can be a tricky business. You have to know your customer well. You have to build a relationship with your customer. In fact, what you really want is to build a partnership with your customer. A partnership is the most productive, trusting and valuable type of customer relationship achievable.

At SugarCRM, we believe the best way to build a partnership is to be transparent, accountable and collaborative. In one word, to be open.  Here’s the simple formula behind why we chose “open” as the founding principle of SugarCRM.

Openness drives accountability.  Accountability builds trust. Trust is the foundation of a relationship.

An open, accountable and trusting customer/vendor relationship creates a true partnership.

That’s why we chose open. To be the best possible partner to you, our customer.

–Clint

When we started SugarCRM in 2004, our vision was simple…to help every business in the world make the connections that matter. We do this by delivering the most open, flexible and intuitive relationship management solutions, giving every business the ability to treat their customers the way they would like to be treated and thereby create loyal fans.

Eight years later, that simple vision of helping companies make the connections that matter has turned SugarCRM into the world’s fastest growing customer relationship management company, delivering software that empowers people to track and manage customer conversations through an intuitive, flexible business application that people love to use.

What I have enjoyed the most these past eight years is meeting all the great people around the world who have come to rely on SugarCRM for their business.  Over 1 million people in over 150 countries now run their businesses on SugarCRM.  Wow!  That’s a lot of people treating their customers the way they themselves want to be treated.

One thing we knew when starting SugarCRM is that technology by itself does not automatically make a company more responsive and more in touch with their customers.  Building a customer relationship management strategy takes a combination of people, processes and technology all working together to accomplish clearly defined and measurable goals.  This is where the SugarCRM value-added reseller ecosystem comes into play.

Our reseller partners around the world help companies like yours build your CRM strategy.  They will show you how to deliver fantastic customer service through software and business processes that make doing business with you easy for your customers. In my travels around the globe, I have had the honor to work with some of the best and the brightest CRM strategists in the industry.  I am continuously impressed with how much hard-earned CRM knowledge our business partners can bring to companies like yours.

When you come to SugarCon this April 23-24 in beautiful San Francisco, I encourage you to come meet our partners.  Ask for advice.  Exchange ideas.  Learn from the best.  You will walk away with at least three great ideas to take back to your colleagues and improve your business.

See you at SugarCon!

–Clint