You'd be forgiven for thinking that they are the same thing but all is not as it seems.
The current buzz around web service led applications would lead you to think that every offering is the same and nowhere is that more applicable in the world of hosted CRM solutions. The two main camps are: Web enabled and Web based customer relationship management (CRM) applications. Although they are similar in that they deliver CRM over the web, there are some significant differences.
Web Enabled CRM Solutions
Typically also, the web enabled options of traditional CRM software offerings involve significant additional cost both to deploy and to support leaving higher ROI targets and consequently a dubious benefit to users and business managers. It’s a “me too” strategy, a knee-jerk reaction to the market, rather than a considered approach to a developing business issue. This is a typical problem for server based software architecture and is not restricted to CRM: all server based software struggles to make the jump to a true web based model simply because it has a technological and cost-structure legacy that is difficult if not impossible to overcome.
In an attempt to rapidly develop products that deliver basic sales force automation features through a web browser interface, quite a few traditional CRM vendors have added a “web front end” to their products, thereby making their software "web enabled." Many have added integrated email management features, call center support and e-commerce applications into their software; but their products are still based on client-server technology, not web technology. In short – you still need to have their software loaded on your server and you will still pay the normal license fees (usually a traditional “per-seat” model).
Web Based CRM Solutions
New CRM vendors are not hampered by the client/server model and are free to build true web based CRM applications that have the web as the core of their delivery mechanism and, indeed, the web IS their software platform. This is a huge advantage – akin to that enjoyed by the client/server developers over the old centralized mainframe/character terminal solutions in the late 90s. When you start with a clean sheet of paper on the crest of a new technology wave you are inherently advantaged over older solutions playing catch-up: buyers should take note of that fact when selecting solutions as technology has a shelf-life and sticking with what you know or have heard of is not always the best way to go. Traditional brands have less meaning during a technological shift such as the one we are undergoing now.
With true web based solutions (also called hosted CRM solutions), you don’t need to distribute software to all of your staff’s desktops or laptops: the application is available via the Internet 24/7 and all they need is access and away they go. Generally, therefore, web CRM applications are cheaper and easier to manage than their client-server based counterparts because of their radically different delivery model. For a start, you don’t buy the software or hardware necessary to deliver it: you simply rent it and pay a monthly fee per user. Web based CRM software therefore can be deployed without the need to involve a corporate IT department – a notoriously difficulty body of people to get new applications past – as it has no impact on their Enterprise IT Strategy. There is no need to worry about housekeeping either as backups and upgrades are carried out by the hosting company. In fact, all you need to do is log on and use the system.
There is of course a cutover point where the hosted CRM solution becomes less cost-effective than the server based solution and that is usually determined by the number of users that you have connected. Most online CRM vendors recognize this fact and offer either a blanket license for unlimited users or a server version that you can host yourself and attach as many users as you want.
Whatever solution you choose, it is important to make sure that you pick the correct partner, with the correct technology and the correct expertise to help you make a success of the project.