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Is Free CRM Software Right for Your Business?


Customer relationship management (CRM) software helps businesses improve relationships by managing customer data, tracking interactions and automating workflows. Meanwhile, the reporting capabilities of a CRM system help evaluate the performance and productivity of sales and marketing efforts.

But as with any paid system, CRM software is a financial investment that can present a challenge for businesses, particularly smaller organizations operating on limited budgets. There are many free CRM solutions on the market, but many firms wonder just how robust these systems are, and how they stack up against paid software.

To find out, we spoke to some of the most popular free CRM vendors on the market, as well as customers using their products. Here, we highlight the features, benefits and limitations of these systems.

What Free Solutions Are Available?

While there are many free CRM solutions available, the following are three of the most popular:

SugarCRM Community Edition is the free version of SugarCRM. It features contact management, lead capture, opportunity tracking, a document and content library and unlimited user access.

Community Edition is an open source platform, which means you’ll need your own development talent if you want to configure the internal code. It requires installation and setup, and users must have PHP, a Web server and a database.

SugarCRM collaboration view

The collaboration view in SugarCRM (click to enlarge)

Insightly’s free edition, Gratis, is designed specifically for small businesses. It features contact, project and task management, integration with Evernote and Google Apps, event and calendar management and unlimited customer support.

Gratis provides up to 200MB of storage and allows you to store up to 2,500 records (which include contacts, notes and emails), allows up to 10 custom fields and can be accessed by up to three users.

ZohoCRM’s free edition features customer account and contact management, lead and sales opportunity tracking, email templates and integration with Facebook, LinkedIn and Twitter. It provides up to 250MB of file storage, can store up to 5,000 records and import batches of up to 1,000 records at once, and can be accessed by up to three users.

ZohoCRM reports

The recently accessed reports view in ZohoCRM

Free vs. Open Source Software

While “free software” and “open-source software” are often used synonymously, they’re not quite the same.

With most free solutions, you’ll get a product that provides basic contact management functionality, but you’ll be limited in your ability to customize the software or perform more advanced functions. Despite these limitations, many small business owners find such products perfectly adequate for their needs.

With open-source platforms, on the other hand, the company makes its code freely available to users, who can modify it in any way they want. While this can be a benefit, companies using open-source software must have the technical ability and expertise to make these modifications. Unless you have this expertise in-house, chances are you’ll have to pay for it, which means your “free” system isn’t so free anymore.

What Features Do Free Systems Offer?

The following table illustrates the features that SugarCRM, Insightly and ZohoCRM offer in the free versions of their products:

Activity tracking
Gmail, Yahoo, LinkedIn
Google Apps, Evernote, Outlook, Facebook, Twitter
LinkedIn, Facebook, Twitter
Lead capture
Max. # of records
Max. # of users
Community forums, documents
Support tickets, chat, knowledge base
Support tickets, knowledge base, forums
User guides
User guides, webinars
User guides, videos

With open source software like SugarCRM’s Community Edition, getting started isn’t as easy as simply logging in—you’ll have to first make sure your system meets the memory and database requirements for installation, download and install the software and use the setup wizard to complete the process.

Martin Schneider, SugarCRM’s head of product evangelism, also notes that you’ll have to pay for training for their Community Edition, or else figure it out on your own. You’re also responsible for downloading and implementing product upgrades.

However, keep in mind that many open source products spur the creation of communities of users who share advice, expertise and training tips. SugarCRM, for example, has a community of users who support it. In addition to helping other users navigate the platform, this community helps the company with quality assurance, testing and other aspects of the product.

Loretta Jones, VP of marketing at Insightly, says that Gratis has “90 percent of the same functionality” as the paid version. Functionality not included in free version includes the ability to integrate with MailChimp (meaning you can’t do mass mailings), the ability to sync with Google Calendar and Google Contacts and custom branding.

Additionally, Insightly Gratis provides limited capability to customize fields in customer records (10 custom fields per record in the free version, versus 25 in the paid version). There is no difference between the free and paid version in terms of support.

Meanwhile, ZohoCRM’s free version doesn’t allow mass mailings, custom analytics reports, document sharing or any type of customer support. It also doesn’t allow any extra file storage, which means you’ll need to upgrade to one of ZohoCRM’s paid editions if your files exceed 256MB.

Who Are Free Systems Best Suited For?

Use Case 1: Small Consulting Company

Bud Hartley worked in IBM’s sales and software divisions for over 30 years before starting his own consulting business, Bud Hartley Consulting. While Hartley only has around nine or 10 active clients at once, he has a database of over 2,500 contacts, which includes attendees of training workshops he teaches on negotiation skills and past clients.

Hartley says he chose SugarCRM’s Community Edition in part because of his prior experience with  SugarCRM’s Professional Edition when he worked as the VP of sales and service at Pacific Cargo Control.

Today, Hartley uses SugarCRM’s Community Edition to track and maintain his client contacts, manage email campaigns, make notes and call records when speaking to clients, track attendance at workshop sessions and manage his library of documents and training materials.

According to Hartley, installing the system was “relatively easy,” and he says the different modules and settings screens are intuitive and easy to use on the front end. As such, “I didn’t have to do any customization of SugarCRM’s internal code,” he says.

Hartley says the software is particularly useful in helping him maintain close relationships with his clients and forge stronger relationships with those who attend his workshops.

“SugarCRM saves me a lot of time when I want to know the history of contact with someone,” he explains. “For the classes I teach, SugarCRM assists me in managing the information about the people that attended a given workshop. When I see someone on the list for an upcoming class, I can easily determine when and where I met the person, and I can reference the prior session when I see them face-to-face.”

While Hartley is currently the only person that accesses the database, he says that if his business expands, he’ll likely update to SugarCRM’s Professional edition to gain the added functionality it offers.

Use Case 2: Small Real Estate Company

Micki McNie owns the real estate brokerage company 33 Zen Lane in Denver. A one-person business, McNie manages around 20 active clients and 500 former or potential clients.

For each of her prospective buyers, McNie has a long list of communications, details and deadlines to track. This includes includes regularly communicating with the client in the initial stages of a property search, scheduling inspections, contacting the lender and seller, and so forth.

To manage everything, McNie uses Insightly’s free edition. “I can’t afford to let things slide when I’m dealing with contracts and deadlines,” she says. “Insightly helps me stay organized so nothing falls through the cracks. It helps me save time, and the more time I have in the field, the more time I can spend building my business.”

McNie says the feature she most enjoys in Insightly is the ability to customize Activity Sets for different pipelines. With this feature, tasks are automatically populated in the system depending on the type of contact that has been added. For example, the tasks for someone that is selling their house will be different than those for someone buying a house.

Insightly Activity Sets

Sample Activity Set in Insightly

Other Important Factors to Consider

What level of scalability do you need? Before purchasing a free system, consider the number of users you currently have, and how many are you likely to have in the future. The scalability of free versions is often limited—both Insightly and ZohoCRM only allow three users maximum, for example—so if your business is growing at a rapid rate, chances are you’ll need a paid system that allows you to add more users as you expand.

How much training and support will you require? Many free versions may have limited training and support available. Insightly, however, offers the same level of support for both their free and paid versions, which includes support tickets, live chat and their online knowledgebase. SugarCRM’s active community network of over 30,000 registered developers serves as a helpful resource for users. ZohoCRM, on the other hand, doesn’t provide customer support for its free software.

Do you require customization or integration? Paid versions often have better integration capabilities. Insightly Gratis, for example, integrates with Evernote, but you’ll have to upgrade to one of their paid solutions if you want to integrate with Google Contact and Calendar, Mailchimp and a greater number of customized fields.

SugarCRM’s open-source platform means users can customize it any way they want. Additionally, these developers work on projects and extensions for SugarCRM Community Edition that can be found at SugarForge, the company’s developer community resource, and SugarExchange, which is a commercial site featuring extensions and complementary applications. ZohoCRM’s integration abilities, meanwhile, are limited to social networks.

Remember, the decision of whether or not to use free CRM software for your business will depend on the unique needs of your organization. Always be sure to carefully review the offerings of each vendor before making a decision, and make sure you know exactly what features you will (and won’t) be getting before settling upon a solution.

Free sign” created by Ken Hawkins used under CC 3.0 / cropped and resized.

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About the Author

Alan S. Horowitz is a contributor to Software Advice.

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