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Description: Hoping to take a bite out of Salesforce.com’s fast growth, Microsoft announced aggressive promotional pricing of $34 per user, per month. That’s well below the cost of Salesforce.com

Source: Informationweek.com

Date: Jan 18 , 2011

We give you full sales, service and marketing functionality in our standard service where Salesforce.com does not offer marketing functionality or real-time intelligence unless you use the Enterprise edition,” explained Bill Patterson, director, Microsoft Dynamics CRM, noting that Dynamics dashboards are continuously refreshed whereas Salesforce.com requires users to hit refresh, something they can do only twice per hour without incurring additional charges.
Salesforce counters that few customers need more than a couple of status updates per hour, and Dynamics CRM and Salesforce.com “aren’t even close to comparable,” said an executive who described the latter as far more social, open and mobile.
“Our Chatter collaboration layer gives users a whole new social way to interact with the application, and that’s something Microsoft isn’t even close to delivering,” said Scott Holden, senior director of product marketing at Salesforce.com. “We also have mobile capabilities running on all the major platforms, including iPhone/iPad, Android and Blackberry. Microsoft is closed off in that respect, so you get what you pay for.”     Read rest of story

Questions for discussion:

  • Which of Porter’s generic strategies is Microsoft trying to utilize to compete with the industry leader Salesforce.com?
  • Which of Porter’s generic strategies is the industry leader Salesforce.com employing ?
  • Do you feel MS strategy will be successful in this market? Why?  Why not?

2 Responses to “Microsoft Steps Up Competition With Dynamics CRM 2011”

  1. Brenda Bicharr

    Microsofts launches and intelligent product but strategy?? NOT REALLY :

    From what i gather the launching of the Dynamics CRM should have been expected by Microsoft a while ago seeing as they are a leading system in information technology. However their strategy is questionable,
    Entering a market with focus on going after competition such as their pricing has been known to appeal to just a certain crowd which is usually far from the larger part of the market. Secondly i wonder if they are actually going to make profits talk less of breaking even with pricing as such, i mean i am not big on news like this, but the competition in question is not overpricing their services now are they?? Microsoft seems to be under pricing.
    Secondly the article mentions that Dynamics competition has: “We also have mobile capabilities running on all the major platforms, including iPhone/iPad, Android and Blackberry. Microsoft is closed off in that respect, so you get what you pay for…That will be a great setback for this software, its 2011 and mobile technology hands on is now a necessity for people now more a want and so Microsoft would have a hard time cat5ching up. So that competitive advantage is lacking in dynamics TRM.
    Thirdly there is the factor of transferring from one provider to another…regardless of how low the price is..will people be willing to leave for microsoft just like that? their brand comes in at this point to play a major role…lets see how this pans out.

  2. Abiola Ogunyemi

    Microsoft strategy is not only offering low prices but also includes full sales, service and marketing functionality or real time intelligence which its competitors only offered in the enterprise edition at extra cost to customers. The idea of low pricing is to get a part of it competitors’ market share, since the Dynamics CRM 2011 Online services supports 41 languages and reaches 40 major markets to say the least. The few flaws identified by Salesforce; can be improved upon by Microsoft with time. With the services offered by Microsoft and the improved integrations with Microsoft products, the Dynamics CRM 2011 will be software to reckon with.

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