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Nobody got fired for buying the safe bet, just like no one got fired for buying IBM in the 80’s… until they did! Here's why defaulting to Salesforce is no longer the safe bet it used to be and why it could be a ticking time bomb to the same fate.
Okay, we want to be straight with you from the outset and declare our bias upfront. Code Tonic is a Hubspot solutions partner in Scotland, but before you tune out let me explain below why we as a company would be better off selling Salesforce over Hubspot.... and why we don’t.
Long before we were Hubspot partners, we trialled several systems before we became customers of Hubspot for our own products. No freebies then, and no freebies now, we’ve already put our money where our mouth is.
The Whisky, Gin, and Spirits Industry in the UK – The size of the industry
The vast majority of the Spirits industry are Micro or SME’s businesses even by the EU’s rather over optimistic official standard. 250 employees are considered a large enterprise!
According to IBIS World, the UK Spirits industry employ 27,500 in the UK over 730 businesses – an average of just 37 per company. Even globally there are only two companies who employ more than 5,000 people – Diageo and Pernod Ricard. Compare this to AB InBev (170k), Heineken (76k), Tesla (50k), Apple (140k) or Amazon (1 million) I would suggest 5,000 is a more realistic break point for being a “Large Enterprise”.
Spirits Industry channel background and future
The industry has traditionally been B2B sales and brand marketing led, with customers generally being national importers, wholesalers, distributors, and accounts (both on-premise and off-premise accounts) with a good bit of Travel Retail in there as well. However, more of the industry is now dipping their toes in a hybrid model of selling direct to customers via their websites, distilleries, and existing marketing databases, all the while continuing with traditional channels.
Some of this has jump started due to covid-19 (Diageo's Haig Clubman D2C E-comm site), however there has been a gradual shift towards this for some time as brands look to better understand and serve their consumers, particularly in the ultra-exclusive high-end expressions. Many alcohol brands are even opening fully owned retail (The Macallan, Eden Mill) and pub chains (BrewDog). All of this produces a mountain of “touch point” data from till systems, to loyalty schemes to website member databases. It’s not always more profitable to sell D2C but it is certainly useful for brand building, new product development and to better understand the real brand champions.
Understand your companies’ current context and future aspirations
When looking at the hybrid sales channel mix it is vital when choosing a CRM that you understand both your current context and future aspirations. You want something that is highly capable now but flexible enough for the next 18-36 months minimum.
Some CRM systems can bolt-on to your existing ERP systems, like Microsoft Dynamics 365, Oracle CRM “on Demand”, IBM CRM and SAP CRM. These are great in traditional B2B Manufacturing and ERP niches more traditionally associated with the Spirits industry, but don’t quite cut it for Marketing or Service teams requirements if you're planning on selling direct. Do you really want to create a customer in SAP every time they walk into your popup shop?
On the flip side of that there are some marketing suites that focus solely on just B2C Marketing and claim to have CRM capability – MailChimp, Klaviyo, and Adobe’s Marketo. While they are all excellent tools, they will never be able to form the cornerstone of a CRM strategy that can bring together and provide accurate and timely data to all your teams in Sales, Marketing, Service and Retail. This has become critical recently in order to react swiftly to changing demand from channels.
Sure, you could run them stand-alone or employ a team of developers to integrate everything together. If you don’t integrate them you will end up with data silos which almost always means the customer will notice at some point. Do you really want to send that marketing campaign or Facebook retargeting ad to someone who just raised a complaint case with you? Or send direct mail to a deceased person's family when your customer service marked them as such two days prior?
What you need
Let me be clear, there is no silver bullet here. There is no system in existence that can do it all. What you need is a CRM suite that comes with enough breadth and depth to cover core competencies but also allows for extension where appropriate. For example, a marketplace of add-ons and integration hooks that can be easily managed without a full team of developers to provide full flexibility to use specialist tools in a given context. How useful would your iPhone be without the App Store?
This really leaves us with only two options, Salesforce and Hubspot both for B2B power and a hybrid mix of B2C/D2C and e-commerce interoperability. They couldn't be any more different in terms of their background, how they have evolved and why we believe one is better placed than the other going forward. Let’s dive down and compare them.
A history of Salesforce and Hubspot
Salesforce has grown extremely fast to dominate the CRM Market from the large enterprise market down. When large enterprises had an issue that Salesforce was not addressing, Salesforce simply went and acquired someone who could. So far this has totalled over 64 acquisitions to-date. This has meant that Salesforce has become a bit of a swiss army knife with a solution for every problem in the CRM space, but unlike a swiss army knife there is no “core” holding all the tools together.
Salesforce hasn’t done much to integrate aquired businesses and their software into their core offering. They largely operate as separate chargeable tools that you as the customer are left to integrate – and at a great cost (see below). Salesforce recognised this problem itself when it purchased MuleSoft, a leading integration platform provider, in 2018 but it doesn't solve Salesforce’s biggest problem. There is no “single cloud”, just a multitude of disjointed acquisitions. Buy one and you’ll quickly be caught in the upsell for another, and another. There are great parallels here with IBM, Oracle, and SAP…
HubSpot on the other hand, founded 7 years after Salesforce in 2006, has been built from the ground up as an all in one harmonised platform. It has largely grown from the opposite end of the market to Salesforce through SME’s. As it has matured it has grown into the enterprise space as one system. Hubspot has made a small handful of acquisitions over the years, but as companies have been acquired, they have taken the time to tightly integrate the acquisition into its core suite. You would be hard pressed to tell which parts were acquired and which parts were grown from home.
Hubspot vs Salesforce
Total Cost of Ownership - Transparent Pricing vs Hidden Costs
From the outset Hubspot is incredibly transparent with its pricing with an online pricing calculator. There are 4 products, each with 4 price tiers, with 3 of them starting out with a free pricing tier. Additional discounts are available for bundles.
Take 30min out and try it yourself... it’s 100% free, forever, for the basic set of features on all tools – Marketing, Sales/CRM, Service.
When you need to upgrade to the Professional or Enterprise tiers you’ll clearly be shown what the on-boarding costs are, and if you require extra help or consultancy there is a directory of Partners to assist your team. Training and certification are 100% free, customer or not, over on the Hubspot Academy. Full comprehensive support is included in all paid plans from Pro and above.
Salesforce on the other hand comes with 14 overlapping products, each with 3 to 4 price tiers and some with the prices obscured away. Phone support is charged based on 20% of your total licence spend and 30% for added features. That's the simple part.
When you start looking at implementation costs and partner support the bills really start to add-up. Due to the complexity good Salesforce developers and consultants are worth their weight in gold, if you're doing this in house budget for salaries of between £60-120k (you’ll need 2 or 3 for any decent sized deployment). If you are outsourcing expect rates of around £1k-£1,200 per day. Anything less... run the other way.
Pricing up a Salesforce Service Cloud and CRM implementation for a previous client the bill was well into 7 figures over 3 years. Slow and expensive.
Ease of Use – A Blackberry vs an iPhone 11
I loved my Blackberry in circa 2008, on paper it did everything. Email, Phone, SMS, BBM. Still to this day I maintain there is still aspects that are superior to the iPhone. However, no one can deny that Apple seriously moved the dial in terms of usability. They paired back the options to vital core functions only. They bundled what was two devices (iPod and mobile) into one. They created a slick user experience underpinned by a marketplace that extended the device with other apps. Blackberry and Nokia had apps, often created by the corporate IT department, but they were never to the same slick consistent interface as the iPhone.
The same applies to Salesforce. Salesforce sometimes feels like launch control for a space mission, with hundreds of dials and switches; useful to some but you're almost scared to touch half of them. We migrated a client this year from Salesforce Marketing Cloud to Hubspot Marketing Hub Enterprise and it turned out they were using less than 10% of Salesforce Marketing Cloud functionality for this exact reason.
In terms of consistency, apart from the logo in the top corner, Marketing Cloud is nothing like Service Cloud which is nothing like Sales Cloud.
Salesforce are moving at a snail’s-pace with the rollout of their Lightening Design system. While it’s a great step forward, it feels a little like Windows Phone 7 coming from Windows Mobile 6.5… good but way too late with lots of gotcha’s.
HubSpot on the other hand is the iPhone of its space. All tools, CRM, Sales, Marketing, Service and CMS (website) are consistent and self-discoverable. It's as easy to use as sending a message on your iphone.
Why does ease of use matter for business software systems? Simple. Directly, or indirectly it affects your TCO not only in expenditure and time for extra training and consultancy, but also staff productivity and efficiency. A tool is only that, it should help you be more productive.
Customisation and Flexibility – do you need a million options?
This is one area Salesforce excels in. If you have hundreds of bespoke business processes, and cost is not a problem, then Salesforce will have a button, option or solution for that.
However in reality most businesses don’t have quite as many bespoke processes as they think. Usually processes have “evolved” into existence and not actually been designed end to end. Implementing a new CRM can be a good time to re-examine that.
HubSpot on the other hand, much like the iPhone again, focuses their efforts on extensibility over customisation with first class developer tools (API’s) and a marketplace of curated add-on’s. If you require it you can usually find “an app for that” directly in the hubspot app marketplace (everything from Shopify to Eventbrite to Zoom and hundreds more). And if you can’t, tools like Zapier can connect HubSpot to 1,000+ other tools. All else failing we would be happy to build you one 😊.
Scalability – Will you ever have 5,000+ employees?
In the next 18 months do you see your organisation having 5,000+ employees? At this scale you’ll usually be able to justify a 3-5-person in-house team and it is likely you will be needing the mass array of tools Salesforce offers. In this case Salesforce is likely the large corporate default option… but probably not for much longer.
HubSpot just announced a major feature upgrade to SalesHub Enterprise and a tweak to Marketing Hub pricing that firmly put it in preferred position for all mid-market enterprises and it will not be long for full large corporate functionality to meet ease-of-use.
Underutilisation of a white elephant is going to damage more than it "could" help - the right tool, for the right job, at the right time!
Setup Time - Up and running in days/weeks vs years – yes really it will be years.
This is one area HubSpot excels in. The onboarding experience is just as simple as the user interface. We have completed installs for customers that have taken less than 2 weeks. Larger more complex setups can be complete in 6-8 weeks. We’ve had customers in the spirits industry sending emails in under 4 weeks.
And then there is Salesforce. Depending on what clouds, and the integrations between them, you could be looking at a couple of months to years. The previous project I mentioned for a mid-sized corporate had a program expected to stretch over 3 years… with great power comes great complexity.
Wrapping it up
There is always an exception to every rule, but here is our default hypothesis. If you are a highly complex global enterprise AND you have over 5,000 employees then Salesforce should be your initial assumption. However HubSpot has levelled up their Sales and CRM offerings with an already strong Service and Marketing offering, and it certainly should be in your top two to look at.
If however you are a Micro, SME or small corporate, like the majority of the 730 whisky and spirits companies in the UK, start with Hubspot at the top of your consideration. For ease of use, award winning customer satisfaction with 4,500 reviews on G2, ease of set-up and a total cost of ownership that will be significantly less (in some cases up to 2.2 times less), HubSpot will serve you well now and into the future.
Unless you are Lewis Hamilton why would you buy a multimillion-pound Formula 1 track car (Salesforce), when you don’t have the capability, team, or wallet to use it? Would you not be better with the well spec’d Mercedes (Hubspot) that is cheap to run, well refined, incredibly powerful and you can use it daily?