Microsoft unveils on-demand CRM

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Microsoft launched its first on-demand enterprise application on Tuesday — just days behind the announcement of a Salesforce/Google partnership and the release of Zoho's own enterprise-level SaaS.

Dynamics CRM Online offers full marketing, sales and service capabilities on an Internet-based model. Desktop tools can also be integrated into the system.

“CRM is a big program within Microsoft,” Brad Wilson, general manager of Microsoft Dynamics CRM, said of the launch. “We're investing more than a billion dollars a year to build out data centers for on-demand delivery of applications. We have a very fast-growing CRM business and a very big focus in on delivering applications over the Internet, so it's a natural thing for us to come out with product of this type.”

A combination of digital and other forms of marketing will be deployed to generate demand for Dynamics CRM Online; Wilson said Microsoft tends to use a lot of direct marketing, including e-mail, direct mail and direct response vehicles, created internally and with agencies. The on-demand service will initially be marketed to small and midsize businesses and departments within larger organizations, but no one particular industry will be targeted.

In a competitive move, Microsoft has priced Dynamics CRM Online at $59 per user per month for its Professional Edition Plus — slightly less than Salesforce's $65 full-featured application.

“I think that this is an area that is still very young in its development, and, as a global provider, I think Microsoft has a great chance to redefine this market,” Wilson said. “Really focusing on affordability, higher capability and more capacity at lower price will help us change the price to value equation in the marketplace.”

For the past six months, more than 500 customers have been using Microsoft's Dynamics CRM Online on a trial basis, and executives seem confident that many have made a permanent switch to Microsoft.

Microsoft Dynamics CRM Online is currently available in the US and Canada.

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