Cloud & On-Premise CRM Compared
Before selecting a new CRM system a decision will need to be made about where your database will be stored.
The main deployment options are:
- On-Premise: CRM software licenses are purchased and the database is installed on your server
- CRM in the Cloud: subscribe to a CRM service where your data is stored in the cloud
- Hybrid CRM: purchase an on-premise application but pay a third party to host it
Your secure data resides in cloud with CRM as a service with lower up front expense
Unlike an on-premise application a Cloud CRM solution isn't purchased outright or owned by you.
Rather like renting you don't pay an upfront cost to purchase but instead pay a monthly subscription to use the service. This will also include all CRM upgrades and service updates.
5 reasons to choose cloud CRM
- Removes the overhead of purchasing and maintaining a dedicated CRM server
- Lower upfront expense as it avoids software licence costs
- Spread costs over the CRM lifecycle and avoid capex depreciation
- Enables CRM to be deployed quicker compared to an on-premise implementation
- Only pay for what you use - increase and reduce subscriptions when needed
For organisations that want to utilise existing IT infrastructure or fully control the CRM database from their own servers, including its upgrade cadence
Retaining complete control of data is one reason why businesses choose an on-premise installed CRM solution over hosted CRM. This is especially important to organisations with sensitive client data including legal and financial businesses or those requiring data to be stored in the UK.
In comparison to the recurring monthly cost of cloud CRM subscriptions, businesses that have already invested in an IT infrastructure may calculate that an on-premise package creates a lower total cost of ownership over the longer term.
5 reasons to choose on-premise CRM
- Utilise existing IT investments
- Retain complete ownership of customer data including CRM upgrade schedule
- Avoid immediately increased monthly costs if CRM licences increase
- Utilise in house personnel or outsourced IT resources who will manage CRM
- Less susceptible to potential external connectivity issues
A hybrid CRM deployment combines benefits of on-premise and hosted CRM packages.
With a hybrid set-up on-premise CRM licences can either be purchased or rented and then installed on a managed hosting partner's server.
In some instances this solution can prove a good alternative if an off site hosting model is preferred but where greater control of the hosting platform is required than a cloud service will offer.
A hybrid option is especially suited where very stringent corporate security policies prohibit the use of a cloud solution especially if data is held outside the UK.
Like regular hosted CRM packages hybrid CRM solutions are attractive to businesses that are keen to avoid the IT cost and overhead of managing CRM deployments in house while retaining greater control than a regular cloud solution.