Customer relationship management software has become a crucial part of many organizations as it helps to fulfill a wide range of business needs. Helping to improve contact management, workflow automation, manage your sales pipeline, aid customer service teams, and provide project management features with extensive customization capabilities: they’re an almost crucial investment for small businesses.
But some businesses are still concerned about CRM software costs. Setup fees and other CRM implementation costs can quickly add up, and it can be hard for a small business to justify these expenses. A thorough CRM pricing comparison can help businesses understand the different pricing models and make informed decisions based on their specific needs and budget.
There are hundreds of CRM software providers out there, each offering their own affordable CRM solution so there’s one to suit every budget. Let’s explore the varying costs of CRM tools to help you find the best CRM for you and your business.
How much does CRM cost?
CRM systems can vary in cost dramatically, typically based on factors like the provider, CRM features, scale of use, and total number of users per month. The average cost of a full-featured CRM plan is $67 per user per month, but this can increase dramatically depending on the provider.
Some CRM providers have hidden costs that customers aren't aware of until it's too late so it's important to be mindful of the total amount you will spend on either a monthly or weekly basis.
Software licenses can vary from supplier to supplier but most CRM platforms fall into one of the following four categories:
Free CRM options
Most CRM software providers offer free versions of their products with basic functionality. This helps users with contact management, deal tracking, and customer interactions making them great for new small businesses and startups.
They often come with user and storage limitations,, restricting access to advanced features like customization, advanced reporting, integrations, or the ability to automate tasks. Most providers also offer CRM free trials, allowing users to try before they buy. During this free trial period, users can explore the full potential of the platform and how it could help support their long-term growth.
Low cost to mid-tier CRMs
Perfect for small businesses looking for a simple plan that helps them streamline their processes. These platforms are particularly beneficial for sales teams, providing essential tools for tracking sales leads, managing communications, and optimizing the sales process. These platforms typically range from $10 to $50 per user per month and provide features like sales pipeline management and marketing automation as well as more advanced features like automation, customizable dashboards, and deeper analytics.
These are designed for businesses that need more functionality than a free plan but aren’t ready for large-scale operations.
Enterprise CRMs
As your business grows, you may need to upgrade to an enterprise-level CRM software. Pricing plans are typically higher with monthly costs of around $60 to $150 per user. These systems are built to support expanding teams and processes providing more flexibility and integration options.
Despite the larger feature sets, some mid-tier CRMs come with steep learning curves and require significant implementation. This can involve extensive staff training, data migration, and ongoing support to ensure that the CRM is fully optimized and used to its full potential. Therefore, you need to weigh these factors against the long-term benefits of improved efficiency, customer insights, and scalability that such a system can provide.
Factors that impact CRM software costs
When determining the cost of a CRM system, several key factors come into play, each contributing to the overall investment required. Understanding these factors can help businesses make informed decisions regarding their CRM needs and budget allocations.
Type of CRM and its features
As previously explained, feature sets can significantly impact pricing structure. Different CRMs cater to different business needs and pricing plans often reflect the level of features available. More and more CRM software providers are offering a cloud-based solution meaning they can offer more sophisticated features at competitive prices. These advancements have bridged the gap between affordability and functionality.
Number of users
Most CRM providers charge per user, meaning businesses pay a fee for each user that accesses the system. Some CRM platforms may impose minimum or maximum user limits influencing the pricing structure.
For example, Zoho CRM allows up to three users on their free plan. While this may work for a small business, it can be limiting for companies with larger teams. When exploring CRM solutions, you need to assess the number of users per month that will need access to your CRM software. This can help you control costs while ensuring adequate access for all team members.
Number of contacts
Most CRM systems impose a limit on the number of contacts or records you can store, and this limitation can directly impact the pricing of the software. As businesses grow and accumulate more customer data, exceeding these limits may require upgrading to a more expensive plan.
Some CRMs offer tiered pricing based on the volume of contacts, while others may charge additional fees for exceeding the base limit. Understanding the contact management capabilities and associated costs is crucial for businesses with diverse customer databases.
Data storage
Data storage limits can influence CRM pricing. Many platforms apply caps on storage capacity or charge extra fees when limits are exceeded depending on your CRM subscription.
These caps can apply to the numbers of contacts, files, or the overall volume of data stored within the system. If your business is rapidly growing or already handles large volumes of customer information, these limits can cause issues.
Usage limits
CRM solutions can include usage limits for specific features. For example, some CRM softwares don't allow you to manage multiple sales pipelines or automated workflows. As a business, you should consider your operational demands when selecting a CRM platform.
Evaluate whether the usage they offer aligns with your workflow requirements. Assessing usage limits can avoid business constraints, help prevent additional fees and allow you to pick the right CRM for you and your team as well as manage CRM software costs.
Customizations
The best CRM for your team is one you can customize to suit your business needs. If you need big changes made to the software this could cost a considerable amount of development time and investment, either on your end or the CRM provider.
This can lead to price increases or one-time fees that can cause CRM implementation costs to soar. Small businesses specifically should consider the total cost of these customizations during the sales process to help them better manage their budgets.
Integrations
Integrating external applications with your CRM solution can be costly. Firstly you need to consider the cost of subscribing to these third-party apps and how this will impact the ongoing costs of your CRM software.
Carefully consider what you need from these integrations. Which ones are essential and which ones are just nice to have? Integrations can boost efficiency and help your business run more effectively but it's important to consider how these fit within your budget.
CRM implementation costs
Sometimes additional costs are involved during the initial implementation of your CRM. Some platforms have a CRM implementation charge that covers setup fees, and the process of moving your data over.
You also need to consider the time it will take to train your team to use your platform. Complex systems can come with a learning curve and you may need outside help to get everything running smoothly with your sales team. Some platforms, like Capsule, have zero setup costs and can be implemented quickly and efficiently due to their intuitive nature, so consider this aspect within your CRM cost.
Ongoing maintenance
Some CRM systems require continuous investment in data management, customization updates, employee training, and technical support. Ongoing maintenance costs should be factored into the overall CRM cost, considering long-term system sustainability and optimal performance.
Accounting for maintenance expenses can help businesses allocate resources effectively and maximize the value derived from their CRM investment.
Determining CRM’s return on investment (ROI)
The good news is that CRM software has a high return on investment. The average ROI has increased from $5.60 to $8.71 in recent years showing a 55% increase in less than four years.
To determine the ROI of your personal CRM system, you need to identify all the costs associated with it. This includes both the initial setup and ongoing expenses like subscriptions and maintenance. From here you should measure the benefits you've seen within your company. This includes the ways it's helped you save money or increase revenue.
Managing monthly CRM costs
Tracking CRM costs on a monthly basis is essential for managing budgets, controlling expenses, and optimizing resource use.
By maintaining a clear understanding of monthly CRM costs, businesses can effectively manage cash flow, evaluate ROI, and make informed decisions about how to utilize and improve their CRM system to maximize value and efficiency.
How to make CRM costs more manageable
While CRM systems can often come with a hefty price tag, there are practical ways to manage and minimize these costs without sacrificing the benefits they offer.
Here’s how you can approach your CRM investment with a smart and strategic mindset:
Start small
Think of CRM implementation as a growth process. Instead of diving into a comprehensive, enterprise-level solution that may overwhelm you with features you don't yet need, begin with a basic plan.
Tiered pricing allows you to choose a plan that aligns with your current needs and then upgrade as your business expands. This way, you can gradually incorporate more sophisticated tools as your operations grow, ensuring that your investment grows alongside your business.
Focus on core features
It’s easy to get caught up with exciting new features, but are they really essential to your business? Focus on essential features like contact management, sales pipeline, task tracking, and basic reporting. From there you can consider more advanced features like AI tools and marketing automation but if they don't directly impact your bottom line you may be better off with a more straightforward and cost-effective solution.
Leverage free trials
A free trial period gives you the chance to try a product before you buy. It's an opportunity to explore the software hands-on, giving you a sense of whether it can meet your specific business needs. Don't just explore one platform, try other software to get a clear view of which CRM solution is right for you. Pay attention to how intuitive the platform is and whether it provides all the functionalities you need. Doing so can help you avoid overspending and ensure that features don't go unused.
Consider long-term contracts for discounts
Once you find a CRM system that works for you, stick with it. Many CRM providers offer discounts for annual subscriptions compared to monthly payments saving you a considerable amount. By committing to a longer contract, you can save a significant amount of money in the long run. Just ensure you feel confident in your choice before making a long-term commitment.
Consider third-party integrations carefully
Connecting your CRM with other tools can improve its features and make your work easier, but it can also increase your costs. Before adding any new tools, think about which ones are really necessary for your business and how they can improve your customer relationships. Ask yourself if some tasks can be done manually or if you can wait to add certain integrations until you have the budget for them.
Wrapping up
Finding the right CRM doesn’t have to break the bank. By understanding the various pricing options, focusing on essential features, and taking advantage of free trials, you can make an informed choice that fits your budget.
Ready to explore an affordable CRM solution? Try a free 14-day trial of Capsule CRM today and discover how it can enhance your business without the hefty price tag.
