Is your CRM really your source of truth?

Why CRMs are no longer enough for sales…
Isaac Pohl-Zaretsky
November 22, 2021
Is your CRM really your source of truth?

A couple weeks ago my co-founder Alexa asked a 🌶 question on LinkedIn that got people talking about the CRM slander we all hear. 

I’m not in sales so I wouldn’t normally weigh in on these sorts of discussions (can you tell I’m the technical co-founder?) but this one was interesting. There is a serious love/hate relationship happening with CRMs. Most people agree that it’s hard to displace a CRM within a mature organization - they are deeply entrenched in operations and when done right can actually help give sales the information they need to close deals. But, everyone seems to concede that they can be a nightmare to work with. 

Looking at the comments here are some common threads I picked up on:

  • CRMs are only as good as the data you can get into them. 
  • CRM usability and maintenance improvements become increasingly costly for companies while the core product continues to stagnate.
  • CRMs are no longer as rep-centric as they should be (which leads to reps working outside of the CRM). 
  • CRMs data model is too rooted in the old world of accounts and leads. It doesn’t take into consideration any meaningful product data. 

Overall it sounds like CRMs are ballooning in complexity because our go-to-market strategies have become more complex. 

Product-Led + CRM = Unhappy Join

It’s not as simple as a prospect > lead/account > opportunity flow you see in a typical enterprise sales motion. In the sales-led world, the sales funnel looks similar from company to company (ie. data on leads / accounts). It’s obvious what leads make it into the CRM, and the data fields are well known. 

For PLG, the questions differ dramatically based on the product, how the product grows, and the sales approach at the company.

Instead in Product-Led Sales, you’ll see that...

  • A free user can sign up with their personal Gmail and end up upgrading to a $100K contract (true story - it’s happened). 
  • A developer tool will measure success in the number of API calls and other product features, not the number of leads associated with the account. 
  • A company may get 10,000 sign-ups per week and not all of them are in or should be in the CRM.

CRMs are not equipped to be the source of truth for the complexity of a Product-Led Sales motion.

The level of effort required to maintain the CRM as a source of truth for your go-to-market teams is not equal to the value delivered. 

In Product-Led Sales, the customer journey starts with product interactions rather than sales interactions, so data is first captured in the data warehouse, then the CRM. More often than not it’s either too time-consuming or too difficult to always get this information in the CRM. 

So, important product engagement data is captured in a data warehouse, and customer buying information is stored in a CRM, causing 2 sources of truth to view all interactions with a customer…. which really means that there is no source of truth.

In my view, there are three core problems with CRMs that prevent them from being the ideal source of truth for sales teams:

  • Data Architecture. The underlying data architecture doesn’t support the kind of data, flexibility, and volume PLG companies need.
  • Visualization & Workflow. The visualization layer is not easily configured for the type of information sales teams at PLG companies need nor flexible enough to be easily configured to a PLS motion. 
  • Maintenance Costs. CRMs penalize you with high costs as you start to bring in even a modest amount of product data volume.

CRM Data Architecture Challenges

For this section, I will focus on data architecture challenges specifically related to enabling Product-Led Sales motions and not the general data challenges that exist within CRMs today (bad data management, manual data entry, duplication, and more). 

CRMs are not built to handle time-series data out of the box. 

Valuable data about product usage in the data warehouse is typically time series, a notoriously difficult format for CRMs to handle. The only way to get important product usage data into your CRM would be to create custom fields and populate those with aggregate product usage data. 

Why is this bad?

If you can only ever see a few aggregated data points in a few custom fields, then you may miss out on important trends in product usage that could inform whether an account is ready for sales. For example, let's pretend we're looking at Slack's data about their customer, Stripe. Here are two data points:

  1. Point-in time: VP of Engineering at Stripe usage = 150 messages per day
  2. Time-series: VP of Engineering at Stripe’s usage increased 30% WoW and their usage of APIs has significantly increased

Which is more helpful to inform your sales motion? We’d rather have insights about example 2, however, CRMs like Salesforce and Hubspot can only handle example 1.

CRM’s rigid hierarchy for data objects doesn’t support a PLG motion.

Most CRMs are very prescriptive of the data hierarchy, with the most common model being leads and accounts. So you are forced to shoehorn your PLG motion into this hierarchy, which creates a lot of confusion. Is every product sign-up a lead? Or an account? You might be thinking “Well, it’s not that hard to create custom objects” and yes it may not be that difficult but what if you want to treat “workspaces” within your product as an object in Salesforce? Or “API calls” “teams” “channels” or “support tickets”? 

Why is this bad?

In a product-led world, objects beyond lead and account can be a helpful way to measure the growth of your product and CRMs make it difficult to break the rigid hierarchy of data objects. 

CRM Visualization & Workflow Challenges

In PLG, there is no one-size-fits solution, so the tools you choose to enable your go-to-market should accommodate flexibility and ease of configurability. CRMs fail on both fronts, especially when it comes down to configuring varying sales workflows and data visualizations. 

Technical resources required.  

The promise of CRMs was to become the business operations layer for every company, a flexible foundation on top of which you could build a multitude of workflows, dashboard visualizations, and apps to run your business. Unfortunately, CRMs have made it difficult for nontechnical business resources to make this vision a reality. This is due in large part to the level of engineering support required to build anything useful on top of an existing CRM. Simple visualizations and data drill-downs are not configurable by sales teams - often requiring data and engineering expertise. 

Discourages experimentation.

In Product-Led Sales you are constantly experimenting with data to discover the perfect PLS workflow and product-qualified leads (PQLs) for your sellers. This experimentation is driven by learning more about product usage behavior and your users' customer profiles, and your tooling needs to support this iterative process. Because CRMs' visualization layer and workflows are difficult to configure, they often get left behind - sales teams opt to work outside of the CRM. So now you not only have two disjointed systems of truth but a fractured system of engagement. 

CRM Maintenance Cost Challenges

As I mentioned above it almost always requires technical resources to ingest more product data, create new visualizations, and new workflows within a CRM - all of this on top of the existing cost of maintaining the CRM itself. 

At the scale and volume of product data a PLG company may produce, from user sign-ups to feature usage, the CRM is a costly tool. Not only does Salesforce scale in cost as the number of contacts you import increases but there are additional costs associated with adding custom objects, creating custom reports, and maintaining the entire system itself. Treating the CRM as the primary source of truth in a PLG company (where all of your data is piped into the CRM) will scale to inefficient costs very quickly. 

It’s why we’re seeing the data warehouse becoming the more cost-effective source of truth for most PLG companies and the CRM is used to drive sales-only workflows.

So how do you reduce the cost of CRMs while still providing sales teams the data they need to find those golden opportunities from existing product users?

Enter the Product-Led Sales Platform

Pocus has built the first Product-Led Sales platform that turns product data into revenue. Pocus equips sales teams with the data they need to convert their best users into high-value customers — all without ongoing engineering support. 

We bring together product usage, customer fit, and buying intent data into one view, with insights tailored to your business — whether the VP of Engineering is actively engaged, the product went viral within a specific team, or an account hit a paywall — so you can take the right action at the right time.

Pocus acts as a layer on top of your existing CRM and Data Warehouse. We leverage the data you already have in your CRM and product data warehouse, sync this data to Pocus in a combined view of your leads, accounts, or any other custom object you would like to analyze. We give sales teams the keys to configure signals, easily see what accounts are ready for sales, and take action on that data all in one place.

Learn more about our POV on the Product-Led Sales platform here

Building the new source of truth for GTM teams. 

Today, we’re building Pocus to be a new source of truth for sales teams. A place where their disjointed systems of records can be unified into one holistic view of the customer.

Not only a system of record but also a system of engagement where sales teams can drill down into insights about WHY a particular account or user is ready for a sales conversation. A flexible system that can be configured to any Product-Led sales workflow and drive real action from the data. 

Our vision for the future of Product-Led Sales technology is a world in which the PLS platform can become the “home” for go-to-market teams to experiment with product and customer data in one place. Where AI and machine learning models will automatically generate insights about your best users and accounts who are likely to buy more of your products. Our vision is to deliver on the promises of the CRM and go beyond it to build a tech stack that can grow and scale as Product-Led Sales matures. 

If this sounds interesting to you, join the waitlist.

P.S. We’re looking for people to help us build this future - Join the team!

Is your CRM really your source of truth?
Isaac Pohl-Zaretsky
CTO & Co-founder @ Pocus
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