September 7, 2016

Hosted vs On-Premise CRM Solutions

Recap: we’re talking about CRM (Customer Relationship Management) systems this week. Yesterday’s post looked at how to determine your requirements.

Hi Rob,

I spent four years working in the marketing department for a CRM company. On very special occasions I was allowed out on sales meetings. Normally I would only be allowed out when the sales team wanted someone in the meeting who knew about Google.

Between myself and the sales team we used to call these meetings ‘Jolly Boys Outings’.

A ‘Jolly Boys Outing’ would start with us attending the meeting, and saying ‘yes’ to any questions we were asked. Will the system manage sales leads? Yes. Will it integrate to Google Shopping? Yes. Will it boil the kettle for me? Yes. Will it run my entire business while I sit on the beach? Yes.

After the meeting we would take an extended detour on the way home, stopping somewhere posh to expense the biggest meal we could find on the menu. Under no circumstances would we make it back to the office in time to do any work.

Sometimes, on exceptionally special Jolly Boys Outings, we would find bizarre things to photograph on the way home.

Dogpoo Lane

This was in 2010, and the CRM market was slightly different in those days. With fewer cloud-based solutions there was more of a focus on the solution sale, where a two or three meeting process would lead to a monstrous system being installed on your in-house server. If, indeed, you had a server at all.

These days the trend seems to be free trials and cloud-based solutions. A cloud-based solution simply means that the CRM software and your customer data is hosted on the vendor’s servers. You then log in through a web portal to access the application. Infusionsoft, Ontraport and SharpSpring all operate in this way.

Rather than paying an installation cost and annual licence fee, you now pay a smaller set-up cost, and a relatively low monthly fee for access to the application.

In many cases you get to kick the tyres and checkout the interface before making any real investment in a solution. You also won’t receive a visit from the Jolly Boys, although they’ll still call you to say yes to any questions you have.

On the whole I think the move to a cloud-based arrangement is a good thing. Unless you have a full-time I.T department, I imagine you have better things to do with your time than manage your own servers. I personally wouldn’t recognise a server if I tripped over one. In my mind a server is a giant temperamental computer that lives in a dark cupboard, with thousands of wires protruding from the sides.

The benefit of the cloud arrangement is the vendor is now responsible for all the technical headaches and software updates. Unless you have strong reasons to host your customer data on your own servers I like the cloud-based approach, because it removes the technical headaches.

Sometimes it can work out cheaper to install a system on your own servers because you eliminate the monthly costs, but the monthly costs isn’t the real issue.

The real issue is identifying the closest CRM system to your true requirements.

Another issue is spotting the Jolly Boys when they come calling, and knowing what questions to ask them.

The correct questions to ask to the Jolly Boys mostly come down to integration; getting the right information into and out of the system. All the cool functionality the Jolly Boys want to talk to you about is only cool when the right data is in the system to begin with.

We’ll talk about integration tomorrow.

Rob Drummond

Rob Drummond runs the Maze Marketing Podcast and Maze Mastery. Rob specialises in content production, ad creation, storytelling and CRM systems. He has two published books, Magnetic Expertise and Simple Story Selling, affordable on Amazon.