There are many factors involved in this significant shift from the traditional software purchase and implementation to the On-Demand offerings from companies like Salesforce.com, Microsoft, and Siebel. For the larger enterprise user, there may be implementation fatigue, from the long, drawn-out and expensive projects from the late 1990’s and early 2000’s. For the small and mid-market business, the elimination of the traditional software purchase and the need for less internal resources and infrastructure is very attractive. The increased bandwidth and dependability of the “pipe” and increased speed have also contributed to the acceptance of the On-Demand CRM Solutions.
Advantages of On-Demand CRM
The initial hesitancy for On-Demand Solutions when they were introduced in the marketplace has been replaced with a general acceptance and understanding of the advantages of this type of solution. The advantages included:
Replacement of large Software Purchase with a monthly subscription charge – The On-Demand model is based on a monthly subscription charge per user. This allows a company to extend the software component cost of a CRM implementation over a period of time and eliminates the yearly support & maintenance fees of a traditional software product.
Flexible Pricing, Licensing, and Scalability – Some of the On-Demand vendors provide flexible pricing, allowing you to choose and pay for the functionality and services you need. You pay for the number of licenses you need with the flexibility of added users when necessary. The leading On-Demand CRM vendors have invested in significant infrastructure and have the ability to provide services to enterprise organizations.
Decrease in Hardware Requirements and Support – With a traditional CRM software implementation, you need to make sure you have the appropriate servers, workstations, operating systems, database, and network infrastructure to properly run and support your system. With an On-Demand solution, the costs and support are significantly reduced. As long as you have Internet access, you are able to use your CRM service.
Decrease in IT Support Staff – You need an IT Support Staff with various skills to maintain a CRM Software System. As noted above, as long as you have Internet access, you are able to access and use your On-Demand CRM system. Your IT support costs are reduced significantly.
Elimination of Costly Upgrade Charges – With a traditional CRM software solution, you can expect a major software upgrade every 12-18 months. Depending on your existing solution, the upgrade can be time consuming and expensive. The On-Demand Solutions provide the upgrades as part of your monthly service fee.
Remote Management – The beauty of an On-Demand solution is access from anywhere at anytime as long as you have Internet access. This allows the System Manager to remotely monitor and support the system.
Faster and Easier Deployment – On-Demand solutions eliminates the need to load software on any computer, allowing for faster and easier deployment. It allows the end-users to concentrate on the solution.
Good Solution for Distributed Offices – Distributed offices and users adds complexity to a typical CRM software solution. This is eliminated with an On-Demand solution, giving every office and every user access around the world to the same database.
General ease of use – On-Demand Solutions have been designed specifically for the Internet, providing general ease of use and navigation.
Availability of Good Mobile Solutions – With the improvement and reliability of wireless technology, you have access to excellent mobile solutions for On-Demand services using Blackberry® or Palm® Treo™.
Security and Backup Services – In order to provide a secure and reliable service offering, an On-Demand vendor has to provide the highest level of security and data back-up services. In some cases, you may find their service in these two areas superior to the security and back-up system in your own organization.
On-line Training – As part of the monthly service fee, some On-Demand vendors provide free on-line training. This can be a significant cost saving compared to the traditional classroom training.
Significant Third Party Add-ons and Web Services – As the On-Demand offerings continue to grow and gain acceptance by companies, significant third party add-on offerings have become available to meet various needs including integration, extended sales methodologies, and email fulfillment, to name a few.
Integration Capabilities – Some of the On-Demand Solutions are highly customizable and easily integrated to existing corporate backend systems.
It has take a few years for On-Demand CRM Solutions to find it’s place and acceptance in the marketplace. The improvement and reliability of the Internet, faster deployment, easier support, improvement in the functionality, and integration capabilities have fueled rapid growth. But, hold on, this is just the beginning!
David Cowgill is a Senior Marketing Manager in San Francisco. His coverage area focuses on the technologies that facilitate managing CRM analytics and lead generation.
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