Microsoft Follows Salesforce in Making CRM More Social

Microsoft (NASDAQ:MSFT) is one of the major players in the CRM (customer relationship management) market where it competes with Salesforce.com (NYSE:CRM), Oracle (NASDAQ:ORCL), SAP (NYSE:SAP) and others. Salesforce.com currently has around 15% market share in the overall CRM market, but it is the leader in cloud based CRM. As the shift to cloud based on-demand CRM systems becomes more prominent, it is expected to gain additional market share. Microsoft also launched a cloud version of its Dynamics CRM suite this year, which should help it increase its market share. Microsoft announced that it has added new social features to Dynamics CRM, which should improve collaboration among sales employees and customers. ^[1]

The Dynamics business suite comes under the Microsoft Office division, which accounts for nearly 30% of Microsoft’s Trefis price estimate of $28 and is around 10% above its current market price. We expect the total revenue from Dynamics CRM and ERP to reach $2.5 billion by the end of the forecast period.

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Microsoft Hopes to Boost CRM Market Share by Going Social

Microsoft has been getting aggressive in its cloud CRM business trying to undercut Salesforce.com and Oracle in a bid to gain market share. Salesforce.com recently upgraded its CRM offerings with more social features and upgraded its Chatter tool with realtime chat and groups. It even acquired Assistly a social customer service startup to bolster its CRM offering.

Microsoft’s new upgrades to Dynamics CRM include activity feeds, which enable users to share and access customer details using Outlook. It will make customer data sharing more interactive and will integrate with Microsoft’s existing products. With these new social features, Microsoft aims to bridge the feature gap with Salesforce.com’s CRM offerings.

Our complete analysis for Microsoft’s stock is here

1. Microsoft adding social features to its CRM suite, Total Telecom [↩]