SugarCRM Provides Integrated CRM for Selling and Marketing

Ventana Research analysts participate in many meetings throughout the year to learn about software vendors’ plans and product updates. We recently attended a meeting with SugarCRM to learn about its new management and direction. Founded in 2004 as an open-source project, the company has recently focused on becoming a full-service customer relationship management vendor.

SugarCRM has traditionally targeted small to mid-size businesses and the lower end of the enterprise market. Now, CEO Craig Charlton and the management team – with investment from Accel-KKR, among others – are focused on redefining SugarCRM’s go-to-market motions, shifting from reliance on partners to a more direct-sales mode. Partners in major markets now focus on implementation and act as distributors and resellers in smaller markets. This has enabled more direct control of the customer experience, as evidenced by customers attending the meeting to offer testimonials about responsiveness, implementation and operational issues.

SugarCRM has also rationalized pricing into three main packages: Essential, with basic capabilities for smaller organizations; Advanced, targeting larger mid-size organizations; and Premier, including additional artificial intelligence-based features for more advanced organizations. Unlike many vendors, SugarCRM still offers an on-premises approach – Enterprise – for organizations that, for whatever reason, do not wish to use the cloud. And while this presents issues for vendors in terms of continuing support for older versions of the software, Sugar has a program in place to support all on-premises customers upgrading to the latest or more recent releases.

While there are greenfield sites for CRM systems in markets outside of North America and Europe, the CRM market is mature. This poses two issues: That many existing implementations are old and have not kept pace with changes in the business, and that for vendors, this means new business growth can only come from displacing an incumbent approach. In many ways the two issues are connected, since many of the latest features released by vendors are heavily dependent on the quality, comprehensiveness and timeliness of the data within the system. This is also an opportunity, once organizations realize that taking advantage of these new features to help selling teams sell and manage pipelines and opportunities may require reimplementing CRM and reviewing sales processes to ensure data is being captured appropriately. This is why we assert that by 2025, organizations will recognize that updating processes and sales force automation systems is necessary to support new, data-driven features that aid in maximizing sales effectiveness to achieve revenue targets.

SugarCRM has developed new, data-driven features for Sugar Sell and Sugar Market, such as lead and opportunity scoring using machine learning-based artificial intelligence to help prioritize where resources should be applied. Opportunity and lead scoring can aid in forecasting, using opportunity scores to validate what is at many organizations a judgement-driven, bottom-up process. As many seasoned sales leaders know, there are biases and behaviors within sales teams that can lead to overstated – as well as missed – opportunities. Having an AI-based indication of the probability of an opportunity helps validate judgement, and importantly, provides input on early-stage deals that may close in the period. It can also be used to estimate “blue birds” and smaller deals not tracked at the opportunity level.

The SugarCRM interface is getting a makeover, driven by customer feedback. The overall design philosophy is to make the system easier to use, bringing in the best practices of consumer online experiences to the SugarCRM applications and platform. New features include familiar sidebar navigation menu structures and personalization to make performing common activities and tasks easier.

SugarCRM has also refreshed its partner strategy, introducing a new strategic partnership category as well as traditional reseller and implementation partners. It has committed to establish additional software vendor partners that bring complementary capabilities for customers in the areas of sales, marketing and service. Triblio was featured at the analyst meeting as a complementary offering that performs account and lead scoring to help sales teams identify prospects with a higher intent to buy.

Given the proliferation of CRM system usage, growth for SugarCRM will come from displacing incumbent systems. Success will require a more aggressive go-to-market approach, highlighting why SugarCRM with Sugar Sell is a better alternative than the system a prospective customer is already using. The importance of the user experience cannot be overemphasized, as many existing systems are seen as a necessary evil rather than an aid to selling. And whereas migration tools from other systems will ease the pain of replacing an existing system, there must be an incentive to move.

To this end, if your existing system has turned into nothing more than a reporting database for opportunity and account information rather than a system to help sales and sales teams, then Sugar Sell is worthy of consideration. As part of this due diligence, note that these systems only work if the data is there. That means sales processes must reflect how sales work, and rote data entry should be kept to a minimum, in part using automatic data capture. And finally, although AI/ML show great promise, use of this technology needs to be carefully incorporated into daily work with a view to the benefits of using them – personally and for the business. Better applications are necessary, but not sufficient to improve revenue goal attainment.