The bMighty Blog -- Internet/Web

Today's rollout of Microsoft Dynamics CRM Online, the Microsoft-hosted version of its customer relations management software suite, represents a shot across the bow of arch-rivals Salesforce and Google in the Software as a Service (SaaS) space of functionality delivered on-demand from "the cloud."

I spent some time on the phone with Mark H. Corley, senior director, Microsoft Dynamics CRM Channel Strategy, who agreed with the his competitors that functionality "delivered from the cloud is the best experience for our customers."

But Corley claimed that last week's Salesfoogle announcement means the two companies are merely "catching up to what our customers are doing today," pointing out that Dynamics Online works as an extension of Outlook (or in a browser) and thus is totally integrated with productivity software.

More importantly he said, it's cheaper than Salesforce. The Professional edition (5 GB of data storage, 100 configurable workflows and 100 custom entities) is priced at $44 per user per month while Professional Plus (with 20 GB of data storage, 200 configurable workflows and 200 custom entities) costs $59 per user per month. According to Corley, Professional undercuts the equivalent Salesforce product by a third, while the Plus version costs about half of the equivalent Salesforce solution. "We're happy to change the whole price/value equation," he added.

Based on Dynamics CRM 4.0 introduced in December 2007, Dynamics CRM Online was formerly known as CRM Live.

While 4.0 is aimed at enterprises, and partner-hosted versions are aimed at companies who need to integrate CRM with vertical solutions and other technologies, Corley said that Dynamics CRM Online "fills the gap on the low end" by targeting smaller companies with 5-25 users and no IT resources in place.

Cost savings are important, but so is functionality, and you'll have to compare those for yourself. But if the savings aren't enough to make a small company switch CRM providers, they might be enough to convince newcomers to the CRM world to begin by dipping their toes in cheaper waters.

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