Positioning Hosted CRM Software as a Network

Software as a Service (SaaN) offerings have grown in popularity among small business owners, especially since web-based services often cost far less per month to maintain than typical boxed small business CRM packages. For instance, a popular accounting and invoicing solution that costs $199 per year to keep current results in a monthly spend of over $16 for a single user. Competing web services that cost $12 or less per seat per month enjoy an advantage, both from a cash flow standpoint as well as from the perspective of delivering overall value to a growing business.

Mike McDerment, the CEO of Toronto-based FreshBooks, has even bigger ideas for his small business CRM suite. In a recent video and blog post, McDerment challenged customers to ask for more from their small business CRM software by integrating more of their business operations into networked web applications. Using FreshBooks as an example, McDerment illustrated how users can enjoy the convenience of invoicing on a hosted CRM platform while receiving invoices and tracking tasks from contractors or vendors from within the same system.

For small business CRM users, the power to integrate accounts payable into the same systems can unlock many of the same benefits as enterprise-level business intelligence software. Users can make more accurate cost projections, while enjoying more visibility into contractors' task progress. Integrated credit card processing improves cash flow, since users who rebill subcontractor work can connect invoices to specific tasks and jobs. A networked small business CRM solution can also evolve into a job referral platform, since users become more likely to select vendors already using the same hosted CRM tools.

McDerment calls this new way of thinking about hosted CRM a move toward "Software as a Network." Instead of viewing CRM applications and other web tools as silos, he uses Facebook as a model for what can happen when multiple software tools within the same shared destination site. While comments at TechCrunch and other blogs suggest that SaaN may not replace SaaS as a buzzword anytime soon, users of competing hosted CRM applications may find themselves craving the same kind of streamlined functionality as FreshBooks integrated business management suite.