5 tips to optimize your CRM costs

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6 min read

Basing the worth of a CRM system solely on its pricing is usually not the best idea for success but cost optimization helps to get the best out of your solution with no cent overspent.


Cost reduction vs. cost optimization

First of all, let's talk about the big difference between cost reduction measures and cost optimization.

Cost reduction

Cost reduction has one goal: to pay less. This can mean that resources, functionalities and services will be reduced even if they are essential for your business.

And sure, there are times when too many tools, complex contracts and paying models as well as lack of communication between different business units can drive the CRM costs unnecessarily. Reduction could therefore reduce costs and lower complexities.

Cost optimization

Cost optimization, on the other hand, does not aim to cut costs but rather to see where an investment creates the best results and where money can be cut to use it for more important features, services, campaigns and applications.

Whether cost reduction or cost optimization is the better approach usually depends on your overall budget situation. Sometimes, cost reduction is the only viable option because money is tight or other costs are of a higher priority.

However, reductions need to be evaluated properly, including all stakeholders (e.g., customers, users, partners, IT, etc.) to make sure that the short-term savings don't impact the long-term budget (e.g., by inflicting higher resource costs because users have to create difficult workarounds).

A cost optimization makes sense if you want to evaluate if you use your CRM system efficiently, if all licenses are in use, and if there is potential for optimization. Cost savings can be a big part of optimization, simply by increasing the ROI of your investment.

With that out of the way, how can you optimize your CRM costs?

  1. Identify and evaluate hidden costs

Back to overview

It is easy to look at a software and assume that its price is the main cost. But with any software, there are additional and hidden costs that can add up, whether you decide to implement or change it for cost reasons.

For example, usability, integration and data management can have a huge impact on the time the users will spend (or save) to do their daily work. A badly integrated software usually means that data needs to be manually transferred which can cost a lot of work hours.

Hidden costs can also be the amount of maintenance a software needs from your internal IT. cloud-based solutions usually cost less but if they need to be customized a lot to fit all your processes and data structures, they will also add to the overall implementation budget.

You can read more about hidden costs in our fact sheet.

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  1. Rightsize your software, licenses and data

Back to overview

"Rightsizing" usually means a restructuring or reorganization of software, hardware or an entire infrastructure to get a higher value.

Especially with on-premise software, companies used to buy the whole, expensive package without even needing all functionalities. But cloud-based business models - from data storage to software to development platforms - are here to stay and offer much more flexibility to re-arrange infrastructure cost-effectively.

Rightsizing can also be used when costs are calculated by user licenses, contact numbers, etc. It helps to set up a regular inventory of active users (who actually do use their license) and be aware of the amount of data space, contact limits, etc. that you actually need, so you don't pay for services and functionalities that are not in use (or can easily be downsized without harming daily business).

  1. Keep your data updated & clean

Back to overview

Most CRM systems get more expensive, the more contacts you collect. This is usually defined by specific limits, e.g., per 5000 or 10.000 contacts.

That's why it is very important to clean up your contact base and get rid (or re-engage) your inactive contacts. Even though it might sound nice to claim that you have 40.000 contacts in your database, if only 23.000 of them interact with you and purchase your products and services, then you not only waste a lot of money to house an additional 17.000 contacts, you also negatively impact your engagement rates.

  1. Integration, automation and AI 

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Good integrations can help connect data, processes and workflows which usually results in time savings and increase the functionalities of your CRM. A well-connected system can offer more activities on all your channels, reduce the amount of additional software and keep your data centralized (which means no duplicate data storage costs, a better data overview and thus more efficient use of your data).


Automation, meanwhile, can save a lot of repetitive labor and also make sure that nothing gets lost in the system.

For example, automatic triggers can help employees to get in contact with promising leads, concerned customers or give info on targets and KPI to take further (immediate) action if needed.

Automation can also support customer journeys by providing regular and personalized content and information which saves your creative, sales, service and marketing teams a lot of time and effort.

Another big automation topic is a well-oiled CPQ software as part of the CRM to optimize offers and discounts for the best-possible outcome.


Last but not least, artificial intelligence can help optimize campaign results, click rates, and more by using customer data to optimize your activities and thus save time and money, for example by identifying contacts that are more likely to purchase with a discount or to attend an event.  

  1. Be smart about your contract

Back to overview

Depending on the vendor, licenses can be paid quarterly or annually or even for several years which usually results in a discount. After all, a big one-time payment is more attractive to the vendor than incremental payments that can be cancelled at any time. Additionally, for most enterprise customers, there are options to receive discounts or other perks if you do your research.

On the other hand, you should research if there are any upcoming price increases but also take a look at the development roadmap to see which future functionalities, integrations, etc. are planned.

It's important to check contracts for crucial basics that can have a financial impact long-term.

  • Included functions, data limits, and support options
  • Updates
  • Onboarding services
  • Data ownership and data rights
  • Data regulations, recovery and security measures
  • Delivery dates
  • Penalties and fees
  • Renewal agreements (and potentially higher costs afterwards)
  • etc.

Are you looking for a new CRM system but don't know where to start? Our experts have written up an excellent step-by-step guide that helps you identify the right stakeholders, develop the right documents and make the right decision with a thorough checklist.

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by Juliane Waack

Juliane Waack is Editor in Chief at DIGITALL and writes about the digital transformation, megatrends and why a healthy culture is essential for a successful business.

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