Free CRM Can Ad Up
It's the dot-com model updated for customer relationship management: Offer users a free-hosted CRM service, but force them to look at a slew of advertising.
Recently, CRM ASP launched its gratis service, called FreeCRM.com. And while the rest of 2003 will cost users nothing and will also be ad-free, beginning in 2004 users will have to deal with advertisements.
Denis Pombriant, vice president and managing director of the CRM practice for the Aberdeen Group, says he's very skeptical about the business model.
"I'd like to be positive, but this is shades of 1999 and 2000, and it didn't work then," he says. "This is software that fundamentally impacts the way business run, and if I were a customer I'd be worried about how they are going to monetize this service."
CRM ASP officials maintain it's a good business model and describe it as "tried and true."
The privately held company is targeting small businesses with between two and 100 workers, a different strategy from the current group of ASPs that is beginning to make headway in larger companies and the enterprise space.
"It might add value to a business that has two or three uses, but there are plenty of solutions, including FrontRange, GoldMine, and ACT!" Pombriant says.
The application offers contact management, sales lead automation and follow up, task tracking, trouble-ticket tracking, call automation, email campaigns and document management, reports, and analysis. FreeCRM.com lets users import data from Act!, GoldMine, Outlook, or other contact-management and sales-automation applications.
Users are limited to 5 MB of storage in the document repository, which stores Word, PowerPoint, or PDF files. According to the company, it will also offer vertical applications for the real estate and insurance industries this spring.
According to FreeCRM.com, it uses 128-bit SSL encryption to protect data and is also certified by TRUSTe, a nonprofit organization established to ensure that personal information and identity is protected online.
This is not the first time CRM solutions have been offered for free, albeit with some twists. Nearly a year ago G2X started offering for free an unlimited number of licenses for its Agility Web-based contact management application to companies that purchase a minimum of 100 user licenses. To participate in the G2X special offer, however, companies were required to pay an 18 percent annual maintenance fee based on the total number of users, and are required to make a minimum purchase of the company's Level 1 Service package, which is priced at $25,000 for 100 users.
In addition First Choice Software, which provides add-ons and tools that work with the Amdocs ClarifyCRM suite of products, also started giving away software last February. For the duration of its offer the company was giving away any of its more than 50 products, which include applications and development tools, to anyone committing to three year's worth of maintenance fees, according to David Sirkin, director of marketing.
However, CRM ASP is not relying solely on a free CRM product. The company also offers a Professional Version for $9.95 per month that includes 100 MB of document storage, no advertisements, and live support.