The cost of CRM is a common question from first-time buyers.
How big of an investment will this be? Are there recurring costs I should
consider? There are literally thousands of CRM solutions available on the
market today, each offering its own pricing structure and features, which makes
answering this question a little difficult — but we’re going to try! In this
post, we’ll lay out realistic CRM price ranges, as well as other considerations
that can affect the cost.
Developing a budget and plan for your CRM implementation is so important, so we hope this will help you in that process.
The Basics of CRM Costs
The most popular CRM software today is Cloud hosted. These
CRMs have monthly fees between about $50/user and $135/user. Most CRM companies
will require customers to purchase a minimum number of CRM user licenses with
their solution — ranging anywhere from 7-20 people — and request payment
annually for the renewal of these licenses. There are a handful of CRM
providers that require customers to sign a three-year minimum contract, but
that is less common. Typically, a company purchasing a CRM with 10 user
licenses will spend between $6,000 and $16,200, depending on which CRM is
chosen and any additional features that are required.
Aside from the initial CRM purchase, you must also factor in ongoing costs. These costs break down into two main categories:
- Renewal fees – These will usually be the same as your initial software cost and occur once per year.
- Additional licenses/users – Unless negotiated as part of the initial contract, expect to pay MSRP for additional users.
Baseline CRM Investment by Company Size
The average cost of CRM implementation varies depending on the size of your business. If you have a lot of employees, you’ll need more user licenses. It’s just science! Below, we list the price ranges for SMBs, mid-market companies, and enterprise businesses. Why is the range so wide? Because the cost of your CRM implementation factors into your specific requirements. How much are you paying per user? How many licenses are you purchasing? Are you getting any discounts for a multi-year agreement? These aspects affect the baseline CRM investment from company to company.
- Less than 20 users
- Average CRM implementation cost between $10,000
- 21-100 users
- Average CRM implementation cost between $25,000
- 100+ users
- Average CRM implementation cost between $150,000
to $350,000 for Enterprise
Necessary CRM Services
What many companies don’t realize is that a CRM investment not transactional. For a CRM implementation to be successful and deliver ROI, certain services must come along with the CRM purchase. This is where CRM consultants come in. We use our knowledge and skill sets to plan your CRM implementation, set up the system correctly, configure it to your needs, and train your teams on how to use it. Without these services, businesses are left with software that doesn’t fit their needs and that no one on the team knows how to use. Not an ideal situation!
#1 Requirements / Planning
Some CRM implementations are quick and easy, but most require a little elbow grease. If your business requirements are simple and you plan to use your CRM out-of-the-box, you won’t need a detailed requirements and planning phase. However, most businesses investing in CRM want the ability to advance its uses beyond the basic functions. In these cases, the business must precede the CRM implementation with a requirements and planning phase. By establishing a clear vision for your CRM and how it should support your team, you’ll be able to identify conflicts early on and more clearly define any additional costs that will result.
For example, in your planning phase you may
realize that customizing the CRM or integrating it with one of your
pre-existing solutions would enhance the value for your team. To create requirements
that are actually helpful, your consultant will need some detailed information.
The cost of requirements is driven by the following requirements-gathering
activities and actions:
- Number of interviews
- Number of departments
- Number of design workshops necessary
- Number of business processes that must be documented
- Number of integrations desired
- Number of existing systems to review
- Number of data migrations
- If you need data cleaning and governance
Requirements can cost between 10K to 75K depending on these factors.
Basic CRM setup is fairly simple. It can cost as little as $5,000, but it can also cost upwards of $20,000 depending on the complexity of the security and the number of users.
The CRM configuration is the technical aspect of the CRM setup. This can cost anywhere from $6,000 to $10,000, depending on the number of modules you want to implement. We recommend budgeting $2,000 per module for configuration work.
The cost of CRM training will change depending on delivery and the number of users being trained. Training typically runs about $1,500/class for out-of-the-box Web courses. Custom training often costs a minimum of $10,000, plus $150 / user. If you need multiple curriculum and multiple user guides for different roles, expect to add $10,000 to $15,000 per curriculum / user guide.
With all the wonderful things technology can do, it’s still far from perfect. There will be times things don’t work as they should: customizations could break with upgrades, integrations could malfunction, user error could stall a process, etc. That’s why it’s crucial to have CRM support.
Most CRM providers offer some sort of basic support (also called Continuous Improvement) via email or portals, but if you’re working with a consultant, we always advise using them as your support partner. Why? Your consultant knows your specific system and all its nuances because of the requirements they did for you. The consultant will be able to provide more personalized (and possibly even faster) support when you run into trouble. Basic support packages are usually free, but CRM providers and consultants will charge fees per user, per month, for full service options. Support/Continuous Improvement will cost 10-20% of your original implementation costs.
Optional CRM Costs
If you do CRM requirements and planning, you’ll know up-front to expect additional costs for whatever services you add-on to your purchase. Below, we’ve listed the three most common optional CRM costs to consider:
#1 CRM Integrations
Many businesses choose to integrate their CRM with supporting software solutions such as marketing automation, ERP, social media, and email. By making information more readily available between systems, teams can increase their understanding of customers and uncover new insights on data trends and analytics.
A CRM integration will cost about $5,000 to $20,000 per integration, depending on if it is a legacy system and if it exists as a Web service. For legacy system integration, budget the higher number, and for Web service, the lower number. Legacy systems usually require your integration to go against a database directly and may require the integrator to build in business logic to make it work properly. If the integrating solution has an API but not a Web service, budget closer to $15,000.
#2 Custom Fields and Functions
Custom fields and functions take a simple CRM solution and adapt it to the way your company works and what’s important to you. For example, if your team would benefit from personalized templates or custom activity types to align with how they work, you’d want to consider this option. Like most other aspects of CRM cost, the pricing for custom fields and functions changes based on the complexity of what’s being asked. We recommend budgeting about $500 per custom function and $50 per field.
#3 3rd Party Add-Ons
When a business can benefit from “like to have” features, they will often select a 3rd party add-on to fill the gap instead of doing a customization. Third party add-ons are effectively applications that live within your CRM to enhance capabilities for things like project management, accounting, commission tracking, and more. They’re called third party applications because they’re created and sold by companies in the CRM’s marketplace, not by the CRM company themselves. Pricing for these are difficult to predict, but they will usually start at about $10 / user / month but can cost as much as half your licensing fees if they’re complicated to replicate.