Can Microsoft Finally Make an Impact in the CRM Space?

Posted by Admin on February 15, 2011 under CRM Software Resources | 7 Comments to Read

(Microsoft CRM Competitors Don’t Think So)

There was a time when CRM software solution providers would have been very concerned about Microsoft entering into their business space.  The company’s brand recognition and “marketing might” would be enough to scare the heck out of most CRM vendors — but things have changed!

Recently Microsoft introduced their new Dynamics CRM 2011 Online offering and has reduced their cost in order to attract new customers away from industry leaders such as Salesforce.com, Commence Corporation, Oracle and SAP. But the competitors don’t seem to be too concerned.  Perhaps it’s because they have heard the hype before and were not negatively impacted by Microsoft’s prior on-premise CRM offering. Or maybe it’s because the Microsoft Dynamics CRM product simply did not live up to its expectations.

The CRM market is chock full of mature product offerings, so Microsoft has been playing catch up for several years.  One of the other challenges Microsoft faces is that while most of the leading CRM providers sell and service their products directly, Microsoft has traditionally utilized third party distribution channels to sell and provide customer service.  This means the customer must rely on the expertise of the third party for the implementation and support of the product and if there is a problem the customer may find themselves caught in the middle.  So why does Microsoft believe they can have a substantial impact in an already crowded market?  I am not sure and perhaps they have a reasonable answer, but price alone isn’t it.

Enterprise players such as SAP and Oracle already have other products such as accounting and ERP system installed in many large accounts. The seamless integration of these products with their CRM solution seems to make good business sense.  The middle market appears to like Salesforce.com and Commence CRM, both of whom have been servicing this space for more than a decade.  While the CRM sector is not fully saturated, the type of customer Microsoft would most likely be interested in probably has a CRM solution already implemented, and if Microsoft CRM is expected to easily replace the incumbent product, they may find this to be a difficult challenge.  Here is my point: Unless Microsoft has some “secret sauce” that no one knows about, their ability to take a leadership position in the CRM sector seems like an impossible mission. But if they can stand the test of time, perhaps they can make it happen.