Client Resource Management tools are virtual version of the Fidget Spinner.  Everyone has one but not everyone needs one and most people look pretty ridiculous trying to use them. The problem is that they are all very different and each has its pros and cons. The two common denominators are

  1. They are expensive
  2. Few people use them well

The reason they are so expensive is that they are expensive to build and maintain for the company’s that provide them. The cost is always passed on to the consumer and that is true again with CRM’s. The largest players in the CRM space cost thousands of dollars per chair and offer features and functions that few people will ever use. SalesForce.com is the behemoth in the market and they are years ahead of anyone else in the space. According to their reported financials to the FTC SalesForce generated $8.39 Billion in 2017. That is Billion with a “B”. They are therefore the largest player in the space by 10 times their closest competitor and we have to pay big…BIG bucks to play with them. The average cost of a chair according to their own reports is fifty dollars a month for a medium to large business. For smaller businesses the cost is higher per chair and can range from $65 to $100 per chair per month. This is after the onboarding fees which run into the tens of thousands.

If a company has 25 employees and plans to use SalesForce the cost is going to be $1,625.00 to $2,500.00 each month. That is no small commitment as the contact is going to be for 12 months at a minimum.

The second issue is the one that kills most businesses. Using a CRM is the only way to have it help create more business. The users must be trained to onboard correctly and then they need to be followed up with to make sure they are using it constantly and correctly. The cost of not using the CRM is the real killer. Matchfaster is a great example of a CRM that was designed by real estate professionals to help overcome this user issue. On a recent interview a spokesperson for Matchfaster reported that the single most common complaint amongst real estate brokers is that the agents are not adopting new technology as quickly as they should. The brokers surveyed reported across the board that their agents were not using their CRM as well as they should or in some cases, at all.

 

Not using a CRM that is being paid for by the broker may seem to have an easy fix but there are extenuating circumstances that contribute to the lack of use of a CRM and methods to have a sales staff more quickly adopt the tool. By looking at different sales companies across the board, the reason the reason real estate agents don’t feel compelled to use their CRM is that they are 100% commission and therefore they don’t feel they owe the brokers in the same way a salaried person does.

Real estate agents not using the tools that are provided goes back way before computers. It was then and continues to be the pay structure of real estate agents. Companies such as Cisco and Oracle pay their sales people with a base plus commission and their sales teams live and thrive using their CRM while real estate agents are paid only on commission and come to the equation with a different Psychology. The average full commission sales person is far less likely to adopt new policies or any other rule because they feel they are less accountable. No matter how great the CRM, no matter how many more sales that could be made being more efficient, the user has to be compelled to use it or it will not work. Full commission pay structures create a problem from the start.

Brokers have long complained that they cant get their people to follow up as they should on the telephone. This problem has not been solved by most of the brokers we have spoken to while the real estate agents use the phone every day to talk to family and friends. Meanwhile a CRM is completely new technology and there is not personal use component. There are some ways of getting real estate agents to perform the actions that are best for them and the company but the concept of full commission has to be addressed from the beginning.

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