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Small Business Owners; Beware the $695 Offer!

If you are a small business owner that is considering the use of Saleforce.com, don’t get seduced by their $695 for five (5) users per year on Team Edition; it is simply a bait and switch tactic like a crack dealer to get you hooked and unable to quit!

Anytime you implement a system that is critical to your business such as accounting or customer relationship management you’ll put significant effort into making it work for your business. Once implemented your business processes will usually become so intertwined with the app it will be almost impossible to switch to something else! And that is what Saleforce.com is preying on.

Although you may have only budgeting $695 for a year of Salesforce.com you’ll have to ante up for more than five (5) times that if you later realize you need features not included with Team. That’s $3900/year for the Professional Edition with five (5) users, or worse it’s $9000/year for the Enterprise Edition. That’s a 561% increase from Team to Professional, and a 1295% increase from Team to Enterprise!

It only gets worse if you have more than five (5) people that need to access Salesforce.com. And note that they don’t have less expensive access for sales assistants, everyone with a login has to pay for a seat based on the full price for the Edition.

How bad is it? Let’s take a look at the features you DO NOT get if you are on Team Edition as per Saleforce.com’s own edition comparison (think you might need any of these?):

  • Salesforce Automation
    • Salesforce Console
    • Customizable Forecasting
    • Contract and Renewal Management
    • Integration with Third-Party Methodologies
    • Product Catalog
    • Revenue Schedule Management
    • Account and Opportunity Team Selling
    • Client Lifecycle Management
    • Advanced Call Scripting
    • Territory Management
    • Mass Quota Updates
    • Worklow and Approvals
  • Marketing Automation
    • Mass Email
    • Lead Management, Routing, and Assignment
    • Web Site Lead Capture
    • Web Site Lead Tracking
    • Campaign Management
    • List Management
    • Advanced Call Scripting
    • Worklow and Approvals
    • Salesforce for Google AdWords
  • Customer Service and Support
    • Document Management
    • Case Queues and Auto-Assignment
    • Advanced Case Escalation and Notiication
    • History Tracking
    • Suggested Solutions
    • Multilingual Solutions
    • Agent Console
    • Service Dashboards
    • Call Center Edition
    • Web and Email Case Capture
    • Self-Service Portal and Knowledge Base
    • Asset Management
    • Service Entitlements
  • Real-Time and Historical Analytics
    • Dashboards
    • Analytic Mash-Ups
    • Read-Only Report Access
  • Desktop and Mobile CRM
    • Offline Edition
    • Desktop Solution Administration
    • Apex Mobile
  • Data Model Customization
    • Custom Object Sharing Controls
    • Smart Field Defaulting
  • User Interface Customization
    • Global Translation Workbench
    • Rename Tabs and Labels
    • Multiple Custom Page Layouts
    • Record-Dependent Page Layouts
    • AJAX Toolkit
    • Standard Button Overrides
  • Enterprise Administration
    • Account-Based Sharing Controls
    • Record-Level Security
    • Field-Level Security
    • Multidepartmental Administration
    • Profile-Based Departmental Security
    • Delegated Administration
    • Opportunity, Lead, and Case-Sharing Controls
  • Business Process Controls
    • Lead and Case Routing
    • Multistep Approval Processes
    • Worklow Automation Rules and Tasks
    • Multiple Business Processes
  • On-Demand Database
    • Weekly Export Service
    • Real-Time Database Mirroring
    • Data Loader
    • Salesforce Sandbox
  • Integration Platform
    • Apex Web Services API 8.0
    • Single Sign-OnóLDAP Integration
    • Salesforce Connector for SAP R/3

How about of you are on Professional? These are the things you don’t get on Professional Edition?:

  • Salesforce Automation
    • Account and Opportunity Team Selling
    • Client Lifecycle Management
    • Advanced Call Scripting
    • Territory Management
    • Mass Quota Updates
    • Worklow and Approvals
  • Marketing Automation
    • Advanced Call Scripting
    • Worklow and Approvals
  • Customer Service and Support
    • Service Entitlements
  • Real-Time and Historical Analytics
    • Read-Only Report Access
  • Desktop and Mobile CRM
    • Desktop Solution Administration
  • Data Model Customization
    • Custom Object Sharing Controls
    • Smart Field Defaulting
  • User Interface Customization
    • Multiple Custom Page Layouts
    • Record-Dependent Page Layouts
    • AJAX Toolkit
    • Standard Button Overrides
  • Enterprise Administration
    • Field-Level Security
    • Multidepartmental Administration
    • Profile-Based Departmental Security
    • Delegated Administration
    • Opportunity, Lead, and Case-Sharing Controls
  • Business Process Controls
    • Multistep Approval Processes
    • Worklow Automation Rules and Tasks
    • Multiple Business Processes
  • On-Demand Database
    • Real-Time Database Mirroring
    • Data Loader
    • Salesforce Sandbox

And here’s the list of things that even Professional Edition customer have to pay extra for:

  • Salesforce Automation
    • Product Catalog
    • Revenue Schedule Management
  • Marketing Automation
    • Web Site Lead Tracking
    • Campaign Management
    • List Management
  • Customer Service and Support
    • Asset Management
  • Desktop and Mobile CRM
    • Offline Edition
    • Apex Mobile
  • On-Demand Database
    • Weekly Export Service

But then here’s another "gotcha"; let’s assume your business is limping along on a Team Edition license because you can’t really afford to pay for Professional and then you hire an 11th person needing access to Saleforce.com, you are screwed! Time to ante up $8580 for a year allowing 11 people access to Saleforce.com!

Now many of you might be thinking that I’m offbase and that I’m begrudging Salesforce.com for trying to make its profit. But please realize most small businesses by definition are scraping to get by and every little expense can be a killer. Small businesses typically just cannot afford to pay for a Professional license let alone an Enterprise license. Yet many of the features small businesses need are simply not available in Team edition are import for small businesses.

Saleforce is trying to position itself as a leader. Leaders don’t implement strategies designed to trick their customers. Instead, leaders focus on meeting their customer’s needs at a price that is fair to their customers. Companies selling intangibles like that which Saleforce offers set their prices based on their market and then focus on meeting their customers needs, not on milking them more then they can typically afford.

What should Saleforce.com do differently?  Drop the 10 user limit on Team Edition and make sure that the features needed by small business are included in Team Edition. Things like SAP integration; well, they can leave that to the Entreprise edition. Then focus on getting as many users as possible, not just milk the users they have. They have a chance to be "it" for SaaS, but their policies are designed to give their competitions as much ammunition against them as possible.

Now don’t get my wrong, there are many companies where it is well worth $150/month to improve your sales team’s productivity, but for many others it’s just not cost effective. In either case, Salesforce.com should rely on selling their value and not trying to set traps; this is just indicative of the general disdain which Saleforce.com has for its customers.

16 Responses to “Small Business Owners; Beware the $695 Offer!”

  • Ron Harris responded:

    Small businesses will find themselves with very few options once they start down the Salesforce.com road other than to pay the higher prices. It is very unfortunate that there are not more people willing to tell it like it is. Thanks for your messages.

    Can you tell us what it’s like to actually try and get your data out of Salesforce.com once you are ready to go elsewhere? I have heard that it is almost impossible to get all of your data and find a way to get it all into a new system. Is that true?

  • Glenn Weinstein responded:

    Salesforce.com’s Data Loader makes it very straightforward to export all data from Salesforce. I’m not sure where the notion that “it is almost impossible to get all of your data and find a way to get it all into a new system” is coming from. Any more details? I have never run into any issue with this.

  • Glenn Weinstein responded:

    Okay, let me answer my own question before someone else beats me to it. :) Data Loader is not available for Team or Professional Edition. My work has been with customers that have Enterprise or Unlimited Editions so I didn’t initially think about that limitation. So an argument can be made that users of
    Team or Professional Edition may face some challenges in easily exporting their data.

  • Mike Schinkel responded:

    Ron, thanks for the comment, and I hope to cover your question in a post by early next week.

    Glenn, your second comment hit the nail on the head. Enterprise customers get all the love; Team and Professional customers are not given the tools they reasonably and legitimately need to use Salesforce.com w/o being painted into a corner. The lack of access to the Salesforce Data Loader is a PERFECT example.

  • Greg Goldberg responded:

    Not having custom fields in any CRM system renders it obsolete, and Salesforce team edition has no custom fields. Almost all other rivals including Salesboom.com and Netsuite.com offer custom fields in all editions.

  • Mike Schinkel responded:

    Greg: Given my rant I hate to be taking up for Salesforce.com related to their Team Edition, but Team Edition DOES in fact have custom fields. OTOH, it’s many other limitations don’t make up for that inclusion, IMO.

  • Mark S. responded:

    I recently found a new product which might be an alternative to SalesForce.com. It’s called Nenest.com. Much easier to use - importing an existing database, copying existing forms, … all on-the-fly. Sure I can download data as Excel files, text files. Most importantly, it’s much cheaper (Free plan, $6 plan, $20 plan…)

  • Mike Schinkel responded:

    Mark S: Thanks for suggesting an alternate.

  • Michael Scheidell responded:

    9 months ago, I complained that a lot of the emails we sent out though SF were being blocked as spam, due to SF not supporting SPF records or proper forwarding.

    9 months later, they finally support SPF records, but still 50% of emails we send through SF are still caught as spam.

    SF recommendation? upgrade to enterprise edition to gain the functionality that was contracted for in the professional edition. (Enterprise edition now allows you to relay through your mail servers so that recipients can judge you on your servers spam reputation)

    Not nickle and dime, rape and scrape.

    it looks like my costs on enterprise edition almost double.

    (yes, I tried to get SF to fix the problem, even explained why relay is better for them to prevent massive spam complaints, but, looks like its more important for SF to lose a 3 years customer)

  • Mike Schinkel responded:

    Michael:

    “Rape and scrape” Ouch! I guess my “Nickel and Dime” comment wasn’t so harsh after all. :-)

    Thanks for the comment. Yes, I agree; SF is a lot more concerned about taking your money than making sure the service works for you *at-the-level-you-paid-for*.

    Sigh.

  • VS responded:

    We thought we were the only ones with this feeling. Our company has the Enterprise edition as a result of feeling like the only way to get what we needed was to upgrade. Now we are at another impass and have been using the application for 6+ years.

    Several attempts to negotiate better pricing and/or more services for the price being paid have been made with little to no follow through - almost felt like we were dealing with ‘Used Car Salesmen’.

    Here we are $100K+ and two instances of the application with little to show for the investment.

    We are running out of space and have found that we either have to Upgrade to Unlimited or purchase additional space or archive/delete data. Using the Data Loader, we can export however, the Attachment content is encrypted (looks like possibly Base 64) and as yet have found no information on how all the varying data tables/fields are linked.

    We do greatly appreciate the ability to do things ‘on the fly’ but are definitely not feeling the love of Salesforce.com.

  • Mike Schinkel responded:

    VS: Thanks for commenting. WOW, I knew how Salesforce.com treated Team and Professional members badly but didn’t realize that they were mistreating Enterprise customers too. $100k+ Ouch.

    It’s becoming even more clear to me Salesforce.com’s culture is about how to milk it’s existing customers continuously for greater monthly fees, and that culture comes from the top. That is so short-sighted, yet is so often seen when the culture is all about “What sales have you closed today?!?” vs. building long-term customer relationships and hence long-term value.

    If Saleforce.com were to instead focus on making their customers raving fans they would position themselves to be the undeniable clear alternative and, given their technology and their head-start, their marketshare would see no limit.

    But Salesforce.com’s customer-hostile culture will be their downfall when another company that is more customer-focused and has the resources aggressively targets Salesforce.com’s customer base. If another company does, I’ll be happy to switch.

  • AG responded:

    Anyone want to buy 5 licenses for one year? I’d gladly sell them at a discount to recoup some of the 2 yr contract I can’t exit.

  • Mike Schinkel responded:

    AG: I feel your pain. REALLY, I do.

  • Jeff S responded:

    There are other alternatives out there like Entellium, which has a low cost solution at $400 per year, does not lock you into a multi-year agreement, offers true support and training and no bate and switch. A good thing to ask about is an SLA and what happens to your data before you sign up.

  • Rob H responded:

    There are lots of alternatives out there … our customers are finding alot of the same issues that you are encountering as well. Many of them have doubts.

    SFDC - Bait and Switch Tactics
    Entellium - Corporate Viability - are there doors still open?
    SageCRM - Core CRM functionality at around at the SFDC entry price
    MSCRM - Similiar pricing, Solid Functionality
    SalesLogix Today - Full feature CRM but in a rent to own model. You own the software and hardware at the end of a 2 or 3 year term and the price is significantly less than SFDC Professional Edition. Difference is it is more of managed ops than hosted model which isnt a whole heck of alot different in this case.
    SugarCRM - Always out there as an option but you have to do alot of the legwork to get all the features you need.

    Again, like I said, lots of options and you really have to do your research before diving into any CRM initiative. SFDC Team edition was made purely to get people into their higher editions, not as a long term viable solution. They catch you, make it sound cheap and a no brainer … then you are on the hook.

    Hope this helps a bit!

    Rob

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