Online marketing services now part of Microsoft-hosted CRM

By boosting its own hosted CRM, Microsoft is helping its hosting partners, too.

Microsoft added online marketing services to Dynamics CRM Online today in a move designed to attract more customers to the new vendor-hosted customer relationship management (CRM) offering.

The online marketing services -- including search engine marketing (SEM) management, search engine optimization (SEO) research and sales lead generation -- are part of the first Dynamics CRM Online service update. Some Microsoft hosting partners already offer similar capabilities, but Lance McLean, owner of Microsoft partner Streamline Solutions in Irvine, Calif., said the service update won't lead to vendor-partner competition.

"I don't think Microsoft has it in for partner hosting providers," McLean said. "I just think that the product needs to do more out of the box."

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Streamline Solutions hosts Dynamics CRM for customers and sells Dynamics CRM Online as well. Anything Microsoft does to promote its Dynamics CRM Online will also help hosting partners, because it raises the profile for all types of hosted CRM, McLean said.

"We're doing better than we ever have in the past, and it's because Microsoft came out with CRM Online," he said.

The online marketing services let Dynamics CRM Online customers create and manage search engine campaigns and research and bid on keywords for those campaigns. Users can also analyze the campaigns' click-through and conversion rates, and capture sales leads from their websites.

Online marketing services are not available in Dynamics CRM 4.0, Microsoft's on-premise CRM software. Their inclusion in the online version will help differentiate the offering and attract more hosted CRM customers, said Bill Patterson, director of product management for Dynamics CRM Online.

However, some partners might argue that the inclusion of additional functions and features in the hosted version flies in the face of Microsoft's previous claims that it will offer the same code base, and features, in both delivery models.

Microsoft's target audience for Dynamics CRM Online is sales and marketing professionals, which is why online marketing services are a good fit, he said.

Streamline Solutions' hosted CRM does not include online marketing services, because it's not something a lot of customers ask for, McLean said. Map integration with Microsoft Virtual Earth and Web gateways for customer-facing pages are more popular add-on features, he said.

Microsoft partners selling Dynamics CRM Online get 10% margin for the initial sale and an additional 10% for every year they remain the subscribing customer's partner of record. Launched in April, Dynamics CRM Online was the first release in Microsoft's online services push.

The offering is Microsoft's entry into the crowded hosted CRM market, where competitors include market leader Salesforce.com plus SAP, Oracle and Sage Software.

The online marketing service update is available for free to Dynamics CRM Online customers in the United States. Also included in the update are support for customer sites with thousands of employees and a direct link to Microsoft Pinpoint, where users can view and purchase additional features offered by independent software vendor (ISV) partners.

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