For many years, my company implemented ERP (Enterprise Resource Planning), or financial accounting systems. And in that world, it’s all about being vertical. That’s because when it comes to financial stuff (ordering, invoicing, purchasing, etc.) businesses do things differently depending on the industry that they’re in. Constructions firms have different needs than manufacturing companies. A company that sells inventory needs to be treated differently than a company that sells services. An accounting firm has different measures of profitability than a retail shop. In the end, it all flows down to the accounting records. But it’s important, particularly as a company grows, to find a financial system that is tailored to your industry.
That was in my ERP days. Now my firm focuses on implementing CRM (Customer Relationship Management) systems, and that focus is completely different. When you’re implementing a CRM system, getting something that’s been tailored to your industry is just not that important. There are three reasons for this…
- A CRM system is based around people, not things. You are not doing orders, time and billing, job costing, and invoicing through a CRM system. You are tracking people. Activities. Communications. Tickets. Marketing campaigns. Opportunities. These things are pretty much tracked the same way across all industries. Sure, there are some companies that are big and much more complex where a very specific, vertical system would be beneficial. But most of my clients are small/mid-market companies. The need for something so specialized is rare.
- Most CRM systems can be easily customized to match an industry. Let’s face it, in the world of CRM 90% of what every company does is pretty much the same. You’re scheduling follow-ups, creating newsletters, managing your forecasts, updating contact information, sending emails. This type of functionality is included in just about every mainstream system nowadays. Need it to be more customized for your company or industry? I’m betting that adding some fields and revising a few of the out-of-the-box reports in your system will do the trick. Doing this is not only easy but much less expensive than investing in a more complex, vertical system. It’s just not necessary.
- Finally, vertical CRM systems are niche players. There’s a certain percentage of companies that have CRM systems (let alone use them well) and an even smaller percentage when you start breaking it down by industry. So the players that have appeared to offer industry-specific solutions are doing so to a much smaller audience. They, in turn, are much smaller players. Sometimes this is good—you’ll get better service, more attention to detail and a potential community of people that really do what you do using the same the system. On the downside, you could be faced with relying on a system that needs updating, is not very well supported, or is made by a company in a more precarious financial situation than its larger, better financed competitors that offer more generalized CRM systems. You’re taking a risk by going there. It may be the right decision or it could be catastrophic if a company goes under.
That said, there are certain industries where vertical CRM systems are really, really good. Healthcare and financial services are two that come to mind. There are some excellent CRM systems specifically geared towards these industries. That’s because they not only have specific needs (HIPAA, integration with both internal and external services, more complex reporting) but also because they’re large and well-financed by big institutions that are willing to invest and get behind a more vertical solution. So if you’re in those industries, definitely take a look at what’s offered. But if you’re like everyone else—manufacturers, distributors, service providers, merchants—you’re probably fine with a general, mainstream CRM system for what you want to accomplish.
At Insightly, we offer a CRM used by small and mid-sized businesses from a huge variety of verticals. Learn about all of Insightly’s features and plans on our pricing page or sign up for a free trial.
About the Author: Gene Marks is a small business owner, technology expert, author and columnist. He writes regularly for leading US media outlets such as The New York Times, Forbes, Inc. Magazine and Entrepreneur. He has authored five books on business management and appears regularly on Fox News, Fox Business, MSNBC and CNBC. Gene runs a ten-person CRM and technology consulting firm outside of Philadelphia. Learn more at genemarks.com
