My first guest in this convo series over nine years ago featured Jon Ferrara, CEO and founder of Nimble. And before Nimble, Jon cofounded Goldmine back in 1989. So Jon literally pioneered the contact management/CRM game and has been involved with it for 30 years.
We find ourselves on the eve of a new decade (and a new decade for CRM). So it thrilled me to speak with Jon to get his take on the state of CRM. We looked at how it has evolved over the years. And I asked if he is surprised by how things have changed (and how they haven’t.) We looked at those changes over the three decades since he cofounded Goldmine.
Below check out an edited transcript of our conversation. See the whole interview by watching the video. Or click on the embedded Soundcloud player below.
The State of CRM
Small Business Trends: When you started with GoldMine, did you imagine like what CRM would look like in 2019 30 years later?
Jon Ferrara: It’s hard to imagine where things will go. But when I started this whole industry, it was about people connecting with people. I think that in some respects, CRM lost its way. Where it stopped being about relationships. Started being about reporting, and command, and control. I think that the reason they call it Salesforce. You have to force salespeople to use it. Nobody in their right mind would use a CRM if they weren’t beat on to do it.
Brent, you don’t use a CRM. Paul doesn’t use a CRM. Most of the CRM analysts I know don’t use CRMs. And why? Because unless you basically are trying to keep your finger on the pulse of the business, a hand around the neck of the salesperson, you don’t need a CRM. But what you do need is you need a relationship manager. Because your network and your brand or your net worth and the people that you connect to are critical to your life’s success.
I think in our over-connected, over-communicated world, it’s getting harder and harder to manage and nurture the relationships around you today. And I think that we’re going through a renaissance in relationships today.
How Social Media is Changing the Game
I think social media is increasing the transparency and the expectations of the people that we connect to on a personal and business level, the companies that we connect to, and I think that CRM needs to reimagine itself to not serve management, but to serve the customer-facing business team members that are engaged on behalf of the company. The biggest cause of failure of CRM is lack of use, and the second is bad data because basically, human beings aren’t designed to type data into computers. Brent, do you know how to touch-type?
Small Business Trends: No.
Jon Ferrara: Neither do I. I finger-pack, and it’s hard to type stuff in. That’s basically why you got to beat people to do it and most people don’t. But then, when they do, people change, company changes, and the data becomes crap. I’m going to tell you the other thing. Today, CRMs are designed for salespeople and maybe a little bit of marketing people, but ultimately, the people across the whole company, they don’t use the CRM.
Different Tools for Different Jobs
Every single team member uses a separate tool in different departments, sales, marketing, customer service, accounting, and the thing that should unify everybody, which is the contact email calendar system, Office 365 or G Suite, isn’t a team relationship manager. You don’t have a common contact database for the whole company, which Office and G Suite should be.
Then, you have siloed the contact departments, and that’s what made GoldMine different was everybody in the company lived in it. So no matter who picked up the phone, you knew who you were talking to, what happened, who did it, what’s going to happen, who’s going to do it, and you need that to deliver a consistent customer experience. Today, we don’t have that. You have bits of it. If you buy Salesforce and Pardot or a combination of sales and marketing, but accounting and customer service are still sort of siloed, but the biggest thing is your contact data …
A Closer Look at the CRM Landscape
Small Business Trends: With all the technology that we have at our disposal and all the great data resources that we have at our disposal, there’s an abundance of things to help folks find, catch, and keep good customers.
Jon Ferrara: Yeah.
Small Business Trends: But is it actually any easier today than it was 30 years ago? Do the tools… Do they come with a layer of complexity that even these great tools today still aren’t really simplifying it as much as it needs to be?
Jon Ferrara: There’s a broad spectrum of tools that we’re talking about, and if we’re going to talk about CRM or marketing automation, which I think is kind of the center of where you and I are kind of focused on, which is the tools that map the customer journey and the engagement thereof, I think that… I think what broke things is people love their Goldmines and ACTs, right? You had to rip those things out of salespeople’s hands, and that was because it served them. It helped them engage.
A Look at the History of Business Tech
Siebel came out and basically made an enterprise out of it, right? That enterprise tool wasn’t designed for the salesperson. It was designed for management, and basically, Outlook came out, and it effectively became the contact tool. So you lived in Outlook, and then you basically fed Siebel to get management off your back, and I think that’s where the disconnect happened.
Salesforce has effectively become Siebel. Marc Benioff built Salesforce by punching Tom Siebel in the nose and saying, “You’re complex, expensive, and you’re not designing for salespeople.” He built a cloud-based SFA tool. But then, basically, he evolved into an enterprise CRM, and I think that they are too complex.
If you look at the typical CRM, it’s got way too many fields and way too much stuff to do, and it’s really all designed for capturing what the salesperson is doing in order to run reports on them, but it’s not enough to enable them to engage. That’s why the sales and marketing technology stack is so exploded.
The State of CRM in the Age of AI
Today, you can’t just buy a CRM. You’ve got to buy sales intelligence and sales enablement at a minimum because you can’t give salespeople marketing automation software. They’re never allowed it to touch Marketo and Pardot. You’ve basically got to give them intelligence, which is like a map for soldiers, and that’s LinkedIn, Sales Navigator. Then, some sort of outreach tool like Outreach IO or SalesLoft.
When you get done buying all those tools, you’re spending $500 a month, per month, and they don’t even know how to use that stuff. So then, you got to buy a sales administrator to manage it all because these things don’t really talk to each other, and I think that what people are looking for is a simple tool that has the contact management, that has the CRM, that has sales intelligence, and has the outreach templated email tracking stuff all built in for an affordable price that just works together and makes them more nimble, shall we say?
Small Business Trends: Number one [response from survey of biggest challenges with using CRM] was that it’s just too hard and too time-consuming to put in data, but the second one I thought was really intriguing. The second one. I think it was 36% of the people said that they don’t know what CRM does for their business.
Jon Ferrara: Yeah.
Small Business Trends: So they know what CRM is, they know it’s something that a lot of companies use, and because of that, they feel like they should be using it… and how it will actually impact their business.
CRM is a Box
Jon Ferrara: That is the big thing right there because ultimately, CRM is a box. It’s a database that you define what goes in and what goes out, and you have to have a purpose for that. You have to have purpose to put things in and a purpose for taking things out, and most business people don’t understand the necessity of having a customer journey workflow database that enables them to track and empower people to engage effectively, and so they buy the CRM because they think that they… because everybody else has one, and then they basically use it as a glorified contact database.
So there’s 225 million global businesses, less than 1% use any CRM. Most people’s CRM is spreadsheets and email, and the ones that do use CRM, they basically use them as a glorified contact database. It’s a place to put names and numbers, and have tasks and notes. Heck, you could do that in Office 365.
Small Business Trends: So how can AI help small businesses see the value in CRM?
Jon Ferrara: Well, I think that when you start looking at big data, social, and AI, you’re able to look at patterns and people, and to synthesize the ideal customer, and to focus sales reps on them. I think that sales reps are like Labradors in a room full of tennis balls, and it’s hard for them to focus. I mean, they’re people-people, and so they need some guidance. Right?
What Your Business Technology is Good For
They need an ability to basically know who to call, what to talk about, and what their next step should be, and they’re not just… They’re human. They’re not really great at that, and that’s what machines are really good at. Machines are good at looking at a lot of data, looking at patterns of the data, and deriving recommendations off those patterns, and that’s what AI does.
You’ve interfaced with sales reps before, and you’ve seen good ones that just excel, and you’ve seen mediocre ones, and you’ve seen bad ones. Right?
You can take the good ones, and look at the motions they do, and the people that they sell to, and the ones that close the fastest and buy the most, and then use that as a pattern to find new leads that rather than calling all hundred of the leads, you call the five good ones, or all 10,000, you call the 500 good ones. Then, you do the patterns that work the best, right? You use the documents, or the customer recommendations, or the customer stories that drive the best results.
What AI Can do for Marketing Automation
So that’s what AI can do for a marketing automation system or a CRM, but I’ll tell you what, Brent. I haven’t seen it yet, but I will say this. So I’m on Microsoft’s advisory board, and I go to Redmond twice a year. I was up in there in November, and I got a briefing from the Dynamics team. I don’t know if you know Alysa Taylor.
Small Business Trends: Oh, yeah. Mm-hmm (affirmative).
Jon Ferrara: Yeah. So she gave a briefing on this next version of Dynamics that’s coming out, and I saw AI in their brand that blew my mind.
Small Business Trends: So it’s been 30 years since GoldMine, and you started Nimble, what, like in 2010 or somewhere around there?
Jon Ferrara: 2011.
Small Business Trends: I’m not going to ask you to project eight years or 30 years into the future, but let’s say like two, three years because technology changes so quickly. That’s the equivalent of about 10 years. What is going to be driving customer relationship management? I’m not talking specifically about the app, but about the process and even …
Jon Ferrara: Yeah.
Small Business Trends: Everything that goes into creating customers.
Jon Ferrara: Yeah.
Small Business Trends: What’s going to be driving that two or three years. Do you think AI will be significantly playing a role in that process, or is this …
Still Siloed, Still Walled Off
Jon Ferrara: I think there’s going to be a layer of AI in all of it, but ultimately, I think that we’re still siloed and walled off. I think that there’s still walls between sales and marketing, customer service and accounting, management and the contact databases. I think that that’s got to be fixed in that there has to be a universal system of record of relationship for business, and that that record has to be able to flow and work in all the places that you work.
So if you’re in customer service, you might be in your customer service application. If you’re in accounting, you’re in the accounting app all day. If you’re in sales, you’re in the sales app, marketing, social, whatever, but those are all separate databases.
Building a CRM with Data you Already Have
What we’ve done with Nimble, is we bidirectionally synchronize with 200-plus SaaS business apps in order to automatically build your CRM for you from the data you already have in your business, starting with Office and G Suite, and then going into the sales, marketing, customer service, and accounting apps that you use to create a universal system of record of relationship. Then, because of our browser plugin, we then work back in the applications that you use.
So I don’t care if we are your CRM or we work with your CRM because we provide the sales intelligence and engagement tools that your CRM doesn’t have and the team relationship system that your contact platform doesn’t have. I predicted into the future that most CRMs will work for you by building themselves, and then work with you wherever you work because the biggest cause of failure of CRM is you have to go to it to use it and you work for it. It doesn’t work for you, and that’s why they basically get beat on by managers every 30 days because basically, they’re not doing what they’re supposed to do, and they shouldn’t have to. That’s what a computer should do for you.
Telling You who to Call
AI should then layer on top of that to tell you who you should call, when you should call them, what you should talk about, what their business is about, and how you best serve them because, Brent, we’re on this planet to serve each other. Service is the new sales. I think I told you when I sold GoldMine, a year later, I got a head tumor and almost died. I went through sort of a journey of self-realization, and I came to the conclusion that we’re on this planet to grow our souls, and we do that best by having tools.
So if I was to predict where Nimble will be in the next 3, 5, 6, 10 years, I would love it to be serving 50 million people to power their dreams, to power their relationships that it basically becomes that tool that we all use to build our network and our brand, and therefore, our net worth.
Building Better Relationships
I think I can do that best by basically partnering with Microsoft because they own the customer, and they own the businesses. We could help Microsoft achieve its dreams by driving adoption or their crown jewels by serving their customers to achieve their dreams by building better relationships. Then, I’ll achieve my dreams because my dream is to power others. My dream is to power people, and the best reward I get is when somebody stops me and says, “Jon, you changed my life.” That’s what I’m here to do as long as I can do it.
This is part of the One-on-One Interview series with thought leaders. The transcript has been edited for publication. If it's an audio or video interview, click on the embedded player above, or subscribe via iTunes or via Stitcher.
Does this mean that a CRM app is still essential? Yes. But it should be communicated well to businesses.
Also, there is a question on why businesses are not adopting this system. This should be researched as well.