On-Premise Microsoft Dynamics CRM vs Dynamics 365 Online: Opting for the Cloud

The details that customers provide, the transactions they initiate, and the way customers engage businesses generate a wealth of information. By constantly analyzing this data, businesses get huge insights into customer behavior. This provides businesses with opportunities to deliver customer-centric products, services, and concepts all of which lead to improved customer relations and business growth.  

Customer relationship management (CRM) software connects customer data with a whole range of business processes involving sales, marketing, and product placement. The end results are more efficient business processes, an in-depth analysis of consumer psychology, and better customer service.   

Microsoft released on-premise Dynamics CRM in 2003, providing a much-needed boost to businesses. Dynamics was developed as a suite of software products designed to provide businesses with the IT support necessary to improve sales, marketing, and customer service.

With the evolution of cloud technology, Microsoft added more features to their Dynamics suite. In 2016, Microsoft released Dynamics 365 bringing all Dynamics services under one cloud. Microsoft provides a higher level of security and reliability, with abundant storage, though their Azure service offering. It is on the Azure cloud that Microsoft CRM online is positioned.

Businesses seizing the CRM initiative often pose the questions, “Should we migrate from  Microsoft Dynamics on-premise to Dynamics 365 online? and ”What is the incentive for bridging the on-premise CRM and online CRM gap?”

According to leading technology management experts, companies that are most successful are the ones that integrate CRM software with business processes. Businesses moving from the on-premise Microsoft Dynamics CRM model to Dynamics 365 online version leverage unique benefits.

Dynamics CRM and Office 365 combine user-friendly features with user-flexibility to create plenty of value addition. Business employees get one-touch access to information that empowers them to increase sales, become more efficient marketers, and enhance customer delight with personalized customer services. Because the Microsoft Dynamics platform integrates different segments of the business processes, it completely transforms the way we do business.

What Differentiates the Traditional CRM on-Premise Model From CRM Online?

On-premise implies that technical aspects including servers, infrastructure, and system design became the responsibility of the business organization. In the on-premise setup, businesses directly render services and implement marketing strategies targeting a loyal client base. Customer data would be harvested for analysis. Traditional methods of customer contact such as emails, email campaigns, and telemarketing efforts would figure prominently. There would be laborious face to face meetings with clients. Brainstorming sessions and product demonstrations would be followed by project reporting and contract finalization. The social media outreach would be minimal.

Online, meaning on “the cloud,” is a setup where the technical infrastructure, upgrades, backups, and security protocols are handled by Microsoft. This arrangement reduces the development stress experienced by stand-alone businesses that don’t have the resources to create and maintain their own IT setup.

With the arrival of Dynamics 365 online, everything changed. The service delivery style and sales cycle, the pricing model and fee structure, the purchasing dynamics, and even the customer profile underwent change. For businesses, there are significant benefits of going online to a cloud.


Better Pricing Models Improve Your Bottom Line

In the traditional setup, businesses had to purchase, maintain, and upgrade their own IT hardware and software infrastructure. The capital expenditure was unavoidable and annual enhancement fees were payable even if the services remained unutilized. Dynamics 365 shifts the burden of IT maintenance expenditure on Microsoft. Business partners save enormously as this makes operations streamlined and profitable.  

Moving to a cloud gives you the benefit of subscribing to a pay-as-you-go pricing plan. This restricts expenses to services that are actually availed, and fees are payable only for the duration the service is used. Naturally, the operational costs savings using this technology are enormous.

Dynamics 365 vastly improves the working of CRM. There are new business processing apps and machine learning (AI) initiatives that boost efficiencies. CRM analytical apps collate, analyze and present customer data in a better way to improve decision making. Services that appeared divergent under CRM on-premise become unified under one command structure.


The SaaS Model Generates Revenues and Improves Services

The Software as a Service setup of Dynamics 365 frees partner resources that would otherwise be wasted on creating and maintaining expensive IT infrastructure. Businesses focus exclusively on generating revenues in shorter sales cycles and improving services. The pay-as-you-consume model improves business bottom lines and improves the quality of customer engagement.


Marketing Strategy Shifts From Product Promotion to Customer Intent

In the traditional setup, customers would communicate face to face placing simple demands, and businesses would respond with product demonstrations and offers. You knew what kind of customers were coming and the kind of queries they’d raise.

With greater access to the net and large bouquet of choices, customer preferences changed overnight. The customer arriving at the store has researched the net and is already aware of the product.

This sparked greater understanding among businesses of the power of social media outreach and product promotion. It also dawned on businesses that the mobile-savvy younger crowd was quite capable of researching, analyzing and deciding product purchases online. An aware audience’s intent had to be satisfied using very different marketing strategies than the traditional methods.

The arrival of cloud-based Dynamics 365 has created a changed business model and this has spawned a different marketing strategy tuned to the needs of a mobile-friendly, internet savvy crowd that has greater purchasing power:

  • You are creating a website that adjusts quickly and compactly to a handheld device used by net surfers always on the move.
  • The visitors can scan the information they need – your contact numbers, email ID, your pricing slabs – anything that engages them and converts them into buying customers.
  • The content is of the highest quality, refreshed frequently, and is moving in sync with changing trends in the industry. Blogging receives a full promotion as it is a reliable method of leveraging SEO to move higher in SERPs.
  • Microsoft introduced AppSource that helps businesses locate and use Microsoft apps to reach out and attract more customers.
  • Businesses expand their presence in various media channels. This helps engage more customers, increase the traffic to the website, and spur conversions.   


The jury is out, and the verdict is 3 to 1 in favor of CRM Online. Needless to say, every organization weighs individual needs and requirements before deciding its CRM strategy. Considering all factors, there’s every reason to believe that CRM Online will grow from strength to strength as it decimates the competition over the next couple of years.  If your business happens to be poised on the cusp of a new CRM initiative, Dynamics 365 online should be the automatic choice.

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