As we all know, competition among business technology vendors is a great thing for business technology buyers. Competition incites vendors to continually innovate and it drives prices to equilibrium levels.

However, competition also drives FUD — the Fear, Uncertainty and Doubt that one vendor casts over its competitors in its marketing messages and its face to face interactions with prospects.

Just as negative political campaigning has and will always be around, FUD will always exist in highly competitive industries because it will always work. Human nature dictates that a large enough percentage of people will respond to negative or fear-inducing messages to make them worth crafting.

While FUD can be an effective sales tactic, it is less than ideal from a CRM buyer’s perspective. However, prudent buyers will take the time to sort through what information is meaningful to their business and what information casts unfounded doubt on a given solution.

FUD isn’t all bad. In fact, the degree of meaning for each FUD factor is usually very subjective. A given FUD factor may ring very true for one organization, but only have a small kernel of applicability for another organization. For some companies, being swayed by FUD may result in an optimal outcome. For other organizations, paying too much attention to FUD might result in a disastrous, costly decision.

With all this in mind, let’s look at some common CRM vendor and VAR FUD factors and analyze their meanings.

CRM FUD Factors to Weigh

1. You Need to Have “Technology X” Developers to Make Their Product Work

A vendor may say that you’ll have problems with their competitor’s application if you don’t have in-house expertise in PHP, .NET, Java, Apex — pick a development environment.  This may be a legitimate FUD factor if you have complex business processes and you want to extend the CRM application using existing, in-house talent. However, if you don’t have a complex set of business requirements and/or you plan to outsource any CRM advanced development, the underlying technology and advanced development toolset may be inconsequential for your organization.

2. You Are Locked Into Their Proprietary Technology

Apple uses proprietary technology — but that doesn’t stop a lot of people from buying iPhones and iPads.  Non-proprietary Ubuntu has failed to make a dent in the desktop market, which continues to be dominated by Windows, a proprietary operating system. If your organization has a heavy bias toward non-proprietary technology (perhaps because your own application runs on non proprietary technology), then this could be a bona fide FUD factor. Otherwise, it’s worth taking a close look at the real risks of committing to a proprietary technology.

3. Their Application is Non-Scalable

A vendor with a full, multi-tenant architecture may say that a competing application with a single-tenant database is “non-scalable”. The concept of scalability needs to be related to your organization’s scale.  If your company could scale, over the course of time, from 10 users to 50 users and from 10,000 records to 50,000 records, it’s fairly safe to say that scalability is a non-issue for your organization, regardless of which vendor you go with.

However, if you plan to start with a 500 user pilot and expand to 5,000 users, you may want to spend some time digging into potential scalability issues and what the experience of other customers for a each prospective vendor has been.

4. They Don’t Offer a True Cloud Application

Closely related to the previous FUD factor, this FUD factor questions whether a single-tenant, hosted application is a true cloud application or whether it represents “the false cloud”.

The vendor of a true, multi-tenant CRM application will say that their architecture creates economies of scale and other advantages that are passed on to its customers in a variety of ways.  While this FUD factor has legitimate aspects, it’s still worth digging into the differences between single-tenant and multi-tenant cloud CRM architectures.

5. They Have a Weak Data Security Model

A vendor with a single tenant database model (a separate database instance for each hosted customer) may state that a vendor with a multi-tenant database architecture is non-secure. The implication is that if Customer A and Customer B are on a shared schema, that there’s a risk of Customer A viewing Customer B’s data.  If this was really an issue, we all probably would have heard about it by now.

6. They Don’t Give You Access to Your Data

This is a two pronged FUD factor. It’s partly about in what format you will receive your data if you decide to stop using the vendor’s solution. This comes down to getting a full SQL Server or MySQL database backup vs. receiving a collection of CSV files.

This FUD factor is also about the ability to port your CRM database from a hosted data center to one of your in-house servers without missing a beat. If you go into the CRM buying process thinking that there’s a chance you’ll want to move your database from the vendor’s hosted environment to your in house servers some day, this is a legitimate FUD factor.

7. Their Application is Very Expensive and Will Cost You A Lot of Money

As most prudent buyers know, the price tag of a technology application and the value of an application are two different things. The key metric should be the value of an application rather than the price. A given CRM application can certainly be both cheaper and have higher overall value than another application. However a given application can be cheaper, yet have less overall value.

Value can be difficult to quantify, but it’s at least worth having a value mindset in the CRM evaluation process.

8. Their Email Integration Isn’t as Extensive as Ours

Yes, some CRM systems work with certain email clients better than others.  However, should buyers put the heaviest weighting on degree of email integration among all buying criteria? Email integration certainly can be an important factor, but it’s not the only factor.

It’s important to put the degree of email integration into perspective will all other business needs.

9. Their System is Complicated and Difficult to Use

Ultimately, your management and your users should be the judge of whether a system is easy or difficult to use.  Since all vendors now offer product trials, it’s a good idea to involve multiple managers and users in the evaluation process.

In addition, difficulty vs. ease of use can be more of an implementation and training factor than a product factor. If your company has complex processes, the degree of usability may end up being more about how the application is tailored than how it works out of the box.

10. Our CRM Integrates Better With Our Other Products Than Theirs Does

Many CRM vendors have divisions that sell ERP, HR and other, non-CRM applications.  Sometimes a vendor’s representative or their VAR will state that the competition does not integrate as well as they do with their other divisions’ products because, after all, they own these products.

While this is often true, it can be the case that one of the vendor’s other division’s products was picked up through an acquisition and the CRM vendor doesn’t necessarily have any current advantage over its competitors in terms of thoroughness of integration with that particular application.

11. They Are Not Financially Stable

Questioning the financial stability of a competitor is an age old FUD factor.  A public company with solid profits may cast some doubt on whether a private company is making enough money to survive.

The Entellium debacle served to legitimize this FUD factor at the time it happened, although the odds of a repeat performance like Entellium’s is fairly unlikely.  Still, it does make sense to at least ask some tough questions of smaller, private CRM vendors.

Conclusion

Being exposed to some level of FUD is an inevitability during the CRM buying process if you are considering multiple vendors and if each vendor knows that the competition is being considered.

While FUD is a natural part of a competitive and spirited selling environment, taking a look behind some of the FUD factors will help you to make a more informed decision.