Cloud CRM or On-site CRM for your business?December 31, 2014 - 8 minutes read
Customer Relationship Management (CRM) software is critical for the smooth functioning of your business. You need it to track your sales, manage customer relationships, connect your sales team members and get crucial customer behavior insights to take informed decisions at the right time.
So, if you are in charge of choosing the right CRM software for your company, its natural to be confused about which CRM system best suits your organization’s needs. Since all the CRM software available in the market is not created equal, you need more information to choose the right one.
One of the questions that might trouble you is – Do you need a SaaS based or on-site CRM?
According a Gartner report, the scales will tip in favor of SaaS CRM in 2015. It predicts that by 2025, 85% business will have SaaS driven CRM. So if the report is to be believed, we can see a decade of high growth for cloud CRM starting in 2015.
But this does not mean you have to plainly follow the market trend.
Look at your organization’s needs and match them with the features of the Cloud CRM or on-site CRM suite, before you make up your mind.
First, let’s take a look at the benefits of SaaS CRM:
1. Reduced Total Cost of Ownership (TCO)
Saas CRM is an outsourced, web-based service available on a monthly subscription basis and costs less than on-premise CRM. The reason is that in Cloud CRM you can keep your IT spend to a bare minimum because you do not have to implement on-site CRM infrastructure like additional servers, computers, hardware and hire expensive IT staff. Your vendor takes care of all that; you only subscribe to the web based, on-demand service.
It is generally seen that all the cumulative figures of SaaS subscription (over a period of time) are less than the expenses of implementing on-site CRM. So purely on the brunt of the money you save, SaaS CRM is an extremely good choice.
2. Accelerate your Business
With cloud CRM at your disposal, there is no need to implement hardware and install software. This accelerates your time to the market. The on-demand, subscription based SaaS CRM model with easier user-adoption features and shorter learning curve empowers your business to quickly respond to fast changing market preferences.
3. Increase core business competency
Subscribing to SaaS CRM means you have outsourced software business administration, a non-core competency area. If you have limited resources and lesser time to market, SaaS CRM is a blessing. You are better-focused with your cloud CRM to rev up your business with greater efficiency than the onsite CRM. In a nutshell, you improve the core competency of your business.
4. Greater cost flexibility and business agility
Expenses are what you need to manage and control to increase your topline revenues. Cloud CRM helps you do that because it does away with the need invest in the costly IT infrastructure and licensed software applications. Since service offered is of on-demand, you can increase or decrease the consumption according to business needs. That gives you better control over your CRM expenses.
You can scale up or down your cloud CRM consumption or change the subscription plan to meet the changing preferences of your clients without increasing business overheads. This makes your business more agile.
5. Do away with fixed capital costs
If you need an onsite-CRM, you have to spend on servers, operating systems, database administration and maintenance, annual system upgrades and software maintenance, IT security and troubleshooting. The replacement of redundant systems adds to the financial burden. All the cumulative expenses reduce the profitability of your business.
Cloud CRM offers a cost-efficient option. Since your SaaS vendor spends on the entire IT infrastructure, you have more running capital in your hands, which can be utilized to fund the more critical areas of your business.
Since SaaS pricing models are per user per month, they are simpler, more predictable and less likely to spring up cost surprises or hidden costs unlike the on-site CRM.
6. Easy to maintain and upgrade
The rapid developments in the CRM software industry are driven by fast changing market preferences. Hence, there is always a need to migrate from legacy to more advanced systems for accelerating business profitability.
Replacement of the old on-site CRM with a new one will definitely increase implementation time and costs. If at that juncture your business can ill afford it, you will be in a big dilemma whether to pursue the costly transition or risk becoming non-competitive.
Cloud CRM helps you tide over all the problems with its subscription based plans. You can choose the best one for your business and migrate from legacy CRM to contemporary applications without incurring downtime losses.
A Few Words about On-Site CRM
On-site CRM has its own set of benefits and you should prefer it over SaaS based when your business needs the following:
- If law or the regulatory authority requires your business to host your data within certain geographic area, cloud CRM is not the right option for you.
- Your business processes large and complex data volumes with a high degree of customization. Here on-site CRM is better-suited to serve in a more personalized way than SaaS based model. However, you also have the option of choosing a private cloud, which puts you in charge of the data (this is a costly option).
- Voluminous data integration and its management across the web without firewall issues can be a challenging task for SaaS CRM. In that scenario, on-site CRM is the best option.
- If you require heavy offline capability for your CRM.
It is necessary to closely examine the risks and rewards of both on-site and cloud CRM before you zero in on a CRM that perfectly meets your business’s customer relationship objectives.
A Final word
You need to enhance your CRM capabilities to fulfill fast-changing, complexities of your customers’ preferences and stay ahead in the competition. Sharpening your CRM functionalities with mobile, social media and ecommerce features will definitely help you do that. That is what Gartner is predicting and 2015 could see CRM heading the cloud way. That is where the future of CRM lies.Tags: Cloud Computing, CRM, SaaS