• January 1, 2006
  • By Colin Beasty, (former) Associate Editor, CRM Magazine

Hosting Time Is Money

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Efficient Frontier was facing a problem that many successful SMBs run into--it was outgrowing its CRM system, as more employees needed to access it. Unlike most other companies in this situation, its system was not old. In fact, it was a recent version of Salesforce.com's on-demand CRM solution. While Efficient Frontier could have simply added more users to Salesforce.com, it would have put the company significantly over budget. Efficient turned to open source technology. The company provides paid search engine marketing solutions and then models the expected return on all variations of keyword bids for marketers who work with search engine Web sites such as Google and Yahoo!. A company of approximately 45 people, Frontier manages more than 10 million keywords for 40 of the top 500 search advertisers in the country. Efficient was using Salesforce.com to support its sales team. The company wanted to expand the solution to support outbound marketing and client services initiatives. But as the company grew, it found that providing more than five users with access to Salesforce.com was too expensive to be effective. "We were spending about $600 a month on Salesforce.com," says Tim Krozek, director of sales. "We only had five users working on it. We wanted to have about 20 people on our sales team accessing it along with some additional people on our marketing and client services teams. We found it was going to cost us between $1,200 to $1,300 a month to do that." So Krozek looked for a more cost-effective solution. Most of Efficient's employees are software engineers. The company's search included SugarCRM. "We had some friends within the industry that said it was a good open source solution," Krozek says. What Efficient lacked, however, was an internal IT support staff that could implement SugarCRM and transfer the customer database of 1,100 contacts from Salesforce.com. Krozek turned to SugarCRM partner iRadeon, which offers an on-demand version of SugarCRM's open- source solution, to install and implement the software and provide future service and maintenance tasks. In August 2005 Efficient Frontier migrated its customer records from Salesforce.com. The implementation took less than 48 hours. Krozek simply "gave iRadeon our passwords to Salesforce.com, and two days later, it was done. Everything was up and running." Because most users already had experience with Salesforce.com and because SugarCRM's interface was intuitive, no training was needed--Krozek simply sent out an email to users explaining where they could access the new application. Now the solution supports nearly 20 users and Efficient Frontier expects all sales, marketing, and client services (over 20 people) to be using the solution within the next few months. Making the switch has enabled Efficient to provide all its customer-facing employees with visibility into the information they need, and at a significantly lower cost than would have been possible with Salesforce.com. Efficient is paying iRadeon $75 a month for the software for 10 users, including all support and maintenance needs. "The cost benefits were a no-brainer," says Krozek. "For us to get 25 users it will cost us $150. To think we were paying $600 for Salesforce.com for only five." The Payoff By implementing iRadeon's SugarCRM suite, Efficient Frontier has:
  • reduced its monthly software costs from $1,300 a month to $150 for 20-plus users;
  • increased client services productivity; and
  • increased sales productivity.
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