Loyalty Vs. Lock-In

With the economic downturn the country is now facing, my blogger-in-crime raised some interesting points that got me thinking: Loyalty versus lock-in; does low price and lock-in ensure customer loyalty, or can value-based offerings truly ensure that a customer, whose IT department is looking to cut costs, stick with a CRM vendor?

The question speaks to two key lessons that CRM vendors and businesses have learned in the past 10 years and to the maturation and evolution that CRM solutions have taken, and as a result, is the reason why the market is a far cry from the conditions it faced at the turn of the millennia, when the industry took a nosedive thanks to dotcom bubble bust.

First, companies have learned that CRM is a business strategy/process; the technology that vendors like SugarCRM sell are simply meant to support and help execute those processes.

Secondly, being able to offer scalable, flexible, and customizable CRM solutions is the resulting fallout of that realization, and one that CRM vendors have begun to build their product offerings around, and thus adding value to their solutions as opposed to locking customers in with old school, closed-sourced strategies. Thankfully, both corporate IT departments and vendors like Sugar are better off because of it.