Online CRM Market heats up

Watch out SFDC here comes Microsoft CRM

Posted on April 20th, 2008 in CRM by Admin | Edit

So now that I am playing the role of a CRM analyst, well a blogging analyst on CRM Software. I have already written about my credentials on CRM software, the fact that created an online CRM software called realclients.com and I invested in Clarify, my business partners founded Primus Knowledge Solutions. Well, the world of success demands not what I did almost 10 years ago, but what I know today and how can I provide insights in to the CRM and CRM software market. To do this well, I have to scour all the public relations spin and provide intelligent insights. Here is an article from the credible ZDnet, before Tech Crunch, they were one of the best IT news sources, but of course I am biased. I did work for Gartner for 3 years so I know a few things about news and analysis without spin, which CRM world does require. Check out the article as MS is going to launch an online CRM solution this week. I do think that was the impetus of the Google and Salesforce announcement last week, they wanted to slow down the Microsoft dominance on CRM, which it does with Dynamics and Outlook. Here is the article from ZDnet, I can’t believe they provided a summary along with the blogs snippet, folks these people are smart technologists not just journalists.

Microsoft CRM Online Hunts Salesforce.com | Enterprise Anti-matter | ZDNet.com
Now there’s Microsoft Dynamics CRM Online. And the challenges for Salesforce.com can now begin. The goals of CRM Online are to match or beat Salesforce.com in feature/functionality, absolutely beat it in price, and with the combined power of the Microsoft brand and the ubiquitousness of the Outlook user base, seriously challenge Benioff’s hype machine on the marketing side. And they definitely have a chance at succeeding in all three.

I’m not going to parse the feature/functionality battle between the two at the individual function level here, but I can offer three main reasons why I think CRM Online needs to be taken seriously as an alternative to Salesforce.com. The first is Microsoft’s Outlook UI, known though not always loved by hundreds of millions of users. Love it or not, that user experience makes training for CRM Online a non-issue. Salesforce.com is pretty easy to use as well, but using Outlook is, for most desktop users, already intuitive.

Functional advantage #2 for Microsoft is the ability to shift between on-premise and on-demand, and mix and match the two. On-premise support is about customer choice, and lots of customers I know don’t want to be locked into on-demand any more than they want to be locked into any other deployment model. There are good business cases for on-demand deployment, and equally good ones for on-premise, and Microsoft CRM wants to support them both, something Salesforce.com simply cannot match.

Functional advantage #3 for Microsoft comes from Office integration. Right now this is an on-premise Office integration to CRM Online, which means that if you want to push sales data into an Excel spreadsheet, that spreadsheet can only reside locally. This is not equivalent to the on-demand integration that Salesforce.com is promising with Google’s Apps, but, as I don’t believe Google Apps are really ready for prime-time in the enterprise, I think the Office integration direct from the Outlook UI is a better functional advantage than either Salesforce.com’s Google Apps support or its own native Office support.

That’s the functional side. On the price side, CRM Online wants to seriously undercut Saleforce.com pricing, and is doing so by charging significantly less than Salesforce.com for both basic and premium functionality. At the top end, Microsoft wants $59 per user per month for functionality that would cost a Salesforce.com several hundred dollars per month. Especially when you include the 20 gigs of storage that Microsoft offers for free, for which users of Salesforce.com would pay dearly for. For a comparison of Salesforce.com premium pricing, look at Ephraim Schwartz’s column on the subject. I think it’s going to be largely impossible for Salesforce.com to institute any across-the-board pricing changes to match Microsoft, without watching its stock price collapse. So, on the pricing front, I think Microsoft has Salesforce.com beat cold.

Now for the hype side. That will be hard, as Benioff has proven time and time again. Deals like the Google Apps agreement play well, even if substantively they are a lacking in demonstrable market impact. Regardless, Benioff keeps pulling rabbits like Google out of his hat on a regular basis. But Microsoft has it’s much-vaunted market clout, and Brad Wilson, the GM in charge of CRM at Microsoft, is no wall flower either. And, once Microsoft can get its own platform-as-a-service, Office in the cloud story aligned with CRM Online, there’s going to be a lot to hype that, under the covers, will be more than just a fortuitous rabbit popping up in a cloud of smoke. A lot more.

The article below I published a couple of days ago on this blog, but I wanted to include it for reference, as I do mention the MS Outlook advantage.

Google and Salesforce CRM Deal no big deal

Posted on April 19th, 2008 in CRM by Admin | Edit

On Monday Salesforce.com and Google announced a CRM deal that really is no big deal. I read about it on Sunday night on TechCrunch, to me it’s a big to do about nothing. Do you want to know what the top CRM software installations are? Why would you care, and what is CRM Software, and what can it do for you? Let’s answer the simple questions first, and maybe, just maybe that will help to answer why you should care, and why the announcement was no big deal.

CRM stands for Customer Relationship Management, and CRM Software has been around since the accounting days and client databases. Every big company has a CRM system, and by in large their customer and sales people do use. A research study published showed that only 4.5% of the companies had CRM Software. I didn’t look in to the details too much, but the website caters to small business, and so their research could be just based on SMB market. Why is that not a big deal, that your company or your small business does not have a CRM system?

Well, that is the big point of this blog, that with email, calendar, and web based systems, who really needs CRM. The point of the Google Salesforce.com partnership is just that in my opinion, it’s no big deal. Email is the killer app as far as CRM is concerned, and with contact management systems built in to Gmail or Outlook, those are the systems people will use. Now Salesforce.com has some great functionality, and for more than one person shops it’s a great way to manage customer relationships. Google and Microsoft are the big players in CRM, no SalesForce.com you are not in trouble. The better features you keep building, the more you stay ahead of the free email contact management systems. For any CRM Software provider to compete, they just have to innovate and make their product more business savvy and less email like.