| The On-Demand, or Software as a Service (SaaS) delivery model for customer management applications has grown in popularity, not just for small and midsize businesses, but for larger enterprises as well. As a software market, SaaS and other hosting methods now account for 9% of the all customer management applications. Several benefits make SaaS appealing, but customers typically cite lower start-up costs as the biggest advantage, making the model particularly appealing for companies with 50 or fewer users. The reason SaaS can be delivered more cost effectively than behind-the-firewall software is the advent of a multi-tenancy architecture. This means that a single instance of the software and data model can be deployed in a data center, and then provisioned out to multiple companies. This means that enterprise-class functionality can be had at prices appealing to the mid-market. When evaluating against on-premises software, prospective buyers should consider that process complexity, company size, and software budget all factor in to the final decision. Ultimately there is no right or wrong decision, just more choices for funding a customer management software deployment. Rob Bois, AMR's Research Director covering CRM technoliogies and business trend provided the response to this question. |