Most CRM vendors missing the mark when it comes to positioning

I recently evaluated the positioning strategies of the major players in the CRM industry including Salesforce, Microsoft Dynamics CRM, Sage CRM, Zoho, SAP CRM and many others. My assessment uncovered several mistakes that you should avoid if you want to claim a position in your market. These mistakes work against effective positioning:

  1. Ignoring key factors that can impact your positioning statement
  2. Failing to make a unique claim; i.e., other competitors are making the same claim
  3. Engaging in product-centric positioning instead of customer-centric positioning that focuses on the business value that your prospects want
  4. Stating several benefits so it is unclear which one is the position

In the CRM market for sales force automation, a critical key factor – understanding buyer behavior – has been ignored by several CRM vendors.

One of the rules of sales effectiveness is to understand how the prospect is going to buy, then match your sales effort to the buyers’ process. But when several CRM vendors positioned their offering for sales force automation, they decided to fight Mother Nature and make the claim that they can help companies sell faster.

Of course everyone wants to shorten the sales cycle, but sales experts I’ve been following say it’s not practical to sell any faster than the buyer wants to buy. As a result, these claims either won’t be well received (because they’re not believable) or they will result in ineffective sales behavior:

  • “close more deals in less time” – Zoho
  • “accelerate sales” – Sage CRM
  • “sell faster” – Salesforce.

These CRM companies missed a key factor that could significantly impact their positioning statement and how they talk to the market and most importantly how the market responds. I believe it’s because they didn’t go beyond the foundational “3 Cs of Successful Positioning” research. Yes, you need a thorough understanding of your customer, channel and competition before you start to brainstorm positioning options. But if you don’t identify other factors that may steer you clear of certain claims and focus you on less obvious, your positioning statement is likely to miss the mark. That is what has happened to several CRM vendors included in this assessment.

While every situation is different, there are always important factors that can impact positioning strategy. One factor that impacts positioning no matter the situation is that the target audience is extremely cynical. Aren’t you? That’s why you want to avoid claims that are borderline unbelievable or not creditable like “we inspire your business,” or “we make your employees happy” or “we transform the way you do business.”

Only two CRM vendors are making a unique claim

Here is how some of the major CRM vendors are positioning their sales force automation offering based on evaluation of their websites and some marketing communications:

CRM-assessment

As you can see, only Netsuite (grow your business) and Oracle Sales Cloud (success) are making unique claims. Everyone else has at least one competitor making a similar claim except Infor’s Saleslogix which is positioned as “purpose built CRM.” This describes what Saleslogix is, but does not express a benefit. Thus Saleslogix has no position.

In the CRM industry, vendors are practicing product centric positioning instead of customer centric positioning

There’s another problem with “purpose built CRM” – what is the business value to the prospect? Does anyone care that it’s purpose built?

You can avoid the mistake Infor has made by applying the “So what?” test to your positioning statement. For each answer, keep asking “So what?” until you reach one of only three ultimate promises a B2B software product can deliver: 1) volume (sell more); 2) market share; 3) profit. Because these stripped-to-the-bone benefits might not pass the believability test, you may need to go back to the previous level (the last answer to “so what”) and use that statement.

To learn more about how to apply the “So what” test, read my blog on the subject.

The CRM industry is filled with multi-claim positioning statements and messages

I’m not sure which is more counterproductive – not making a benefit claim or making so many benefit claims it’s hard to determine how a product is positioned. Three vendors have taken the latter approach. For example, SAP for the Sales Cloud “is designed from the ground up for salespeople like you. Work smarter. Sell better. Win more. It’s that simple.”

But it’s not that simple to figure out which of the three claims is the product position. You can avoid this pitfall, as well as the other three described in this assessment by reading my eBook on how to position so the market will listen and by joining my LinkedIn community where tech marketing leaders are challenging the common positioning and messaging practices that are being used in the CRM industry and other tech markets. Click here to join my LinkedIn community.