An on site CRM implementation can be a big investment and should be evaluated carefully. If approached in the wrong way, the risk of loosing your investment is rather big since only 4 out of 10 projects are successful. Not a lot of small and midsized companies can afford this or have the time to spend on a second try-out.

Hosted CRM, could therefore be a good alternative to the on-premise implementation. You avoid the initial investment and do not have to support the solution yourself. The cost is transparent and can be spread over time.

Most providers of online CRM also offer a trial period in order to evaluate their software so that you can make sure that this will cover all your needs. The current generation of On Demand CRM provides a large number of features and solutions for industry specific requirements.

If it is a companies first experience with CRM, using a light hosted CRM solution will also bring more insight to the company and its CRM Maturity will grow. It is easy to start, no installation needed of course, and intuitive so that only little training is required.

Going forth with an online CRM system still leaves the way open towards on site CRM implementation at a later stage. Even large companies use it to pass the time while waiting for their on site CRM implementation. Master data - like customers, contacts and products - can be uploaded and extracted in an fairly easy way.

The biggest challenge until now was the integration with other back end applications but this has been greatly improved with open API's and standardisation using XML and webservices.

CRM has become a commodity, everybody has it and as such it is no longer a competitive advantage that has to be kept under tight control inside of the company. It makes sense to outsource this and use the pay-as-you-go model which is offered by the on demand players and which allows you to do more with your IT budget.