May 8th, 2012 by Brent Leary and Denis Pombriant, CRM Idol Co-Chairs

If were an emerging company today, it would be a good example of a disruptive innovation. In CRM Idol, we’re looking for the next, but we don’t expect that the two companies will have much in common aside from their disruptive nature. Why?

Disruptions happen all the time but, like lightning, they don’t strike the same place twice. So don’t expect to see a “new CRM company.” CRM is a full market niche, in which companies are being bought and merged. New companies have to offer something else, like social capabilities or gamification.

Markets love disrupters because they inject something that has never been seen into the space and, presto! everyone seems to need it. was like that. Salesforce was part of a small class of companies dipping their toes into the surf.  Most had very similar technology at the time but failed in large part because they lacked the cash or marketing savvy to “take it to the house.”

So what makes for an interesting emerging company?  Take a look at last year’s finalists for starters.

Assistly (which was bought by Salesforce,com in the middle of the competition) offered a service desk for very small companies that leveraged social media. They also had a funky business model in which they offered elastic tariffing, with the first user being free.

Crowd Factory is a marketing automation company that employed gamification in a powerful new business process. It was recently acquired by Marketo.

Stone Cobra is a system of engagement that sits on top of other customer service applications, bringing data together for the convenience of the agent.

Get Satisfaction is a social media–leveraging customer service company now branching into marketing. Get Satisfaction won the contest.

And in Europe and Latin America, the pattern repeated itself with companies that were bringing out solutions that were new and ideally suited to their markets. None of these companies offer something that could be seen as out of the box for a more established CRM company. That’s important, because it gives them credibility as disruptors and new category makers.

But technology will only get you so far in the Idol competition. This competition is tough because we are looking for the whole package. Companies that go far in Idol have their marketing and sales functions revved up too. They might be cash poor or they might be living on VC money, but they know what they are about, and when they get an opportunity, they know how to promote what makes them special. Just look at the videos that each of the finalists produced last year and you’ll see what we mean.

As a matter of fact, the videos are a great promotion vehicle well beyond the competition. According to Phil Fernandez, CEO of Marketo, which recently bought Crowd Factory, the video was an important part of the acquisition process. Reviewing the process Fernandez said recently, “I had known Sanjay [Sanjay Dholakia, CEO of Crowd Factory] and Crowd Factory before the CRM Idol competition, but the video they did as part of the program really spoke to me.  It was very focused and compelling, and opened my imagination to what Marketo plus Crowd Factory could do together. So CRM Idol was very valuable in the process.”

Companies that are weeded out early have similar tendencies too. They have competent products, but they don’t do anything special or different from the well-established companies they expect to beat. They also tend to be insular. They are run by founders and don’t have outside investors or a board of directors prodding them to be better. As a result, they sometimes stagnate.

The Idol process assigns a mentor to every participant to give that extra external perspective that some may be missing, adding to the richness of the experience for the participants. The mentors are typically industry veterans with significant experience, and their advice is highly valued.

It’s hard to generalize these points because each company has its unique attributes. But CRM Idol is a competition focused on uncovering real gems, the companies that will, like Google, Facebook, or, (or Get Satisfaction, Crown Factory, Assistly, and Stone Cobra, for that matter) become great hits in niches that they pioneer and in which they develop real staying power. But each will find its own path to greatness, and CRM Idol is simply here to document it.

For more information about CRM Idol, go to our site and grab an application. Don’t wait—the application deadline is May 25 at 6 PM PDT.









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