Businesses Feel at Home With Hosted CRM

eCRMGuide.com Staff

Updated · Sep 10, 2003

Hosted CRM applications continue to gain market acceptance, according to a new report by Aberdeen Group, a Boston-based market research firm.

According to the report, Hosted CRM Popularity Continues to Grow, 35 percent of survey respondents said they currently use hosted CRM products and a whopping 85 percent said they would consider a hosted version as they evaluate CRM solutions.

"Application hosting in the CRM market is clearly showing signs of robust growth," Denis Pombriant, vice president and research director in Aberdeen’s
CRM practice and author of the report, said. "Our data also suggests that companies are looking beyond the current slowdown to a period of more vigorous growth, and that
application hosting is an important component to such growth strategies."

The report also notes, however, that the CRM industry faces challenges in the years ahead. The sluggish economy and the changing complexion of the CRM marketplace
will force vendors to find better, faster and cheaper ways to provide the benefits of CRM to budget-constrained buyers who may be skeptical of the technology’s capability
to deliver value.

Some providers of hosted CRM services are less cautious in their assessments. "Client/Server is dead and the market is beginning to start the burial process." said Mike Doyle, chairman and CEO of Salesnet, a Boston-based ASP that offers Net-native CRM services. "Companies have recognized that there’s a better approach to CRM through the online model." Doyle cites affordability, customization, no maintenance process and fast ROI as benefits to hosted applications.