You may have thought you'd heard the last of companies offering free services over the Internet, with revenue coming
through advertising, but a San Francisco startup is renewing the idea.
CRM ASP Inc. on Wednesday launched a free hosted-CRM offering on its Web site, FreeCRM.com.
"We're trying to deliver on an old Internet model," said CEO Eric Stone. "We're free and we're delivering ads. You haven't heard that in five years, I'm sure."
The offering is targeted at the small and medium-sized business (SMB) market, or, as Stone puts it, "the technophobes who would rather reach for a Rolodex than pick up the mouse."
"Oh, boy," said Wendy Close, CRM research director for Stamford, Conn.-based Gartner Inc. "You know, that model didn't work. We've seen it in the past. Half of the CRM vendors offer some sort of ASP. It's a pretty tough market to get into."
CRM ASP Inc. is going to face a particularly tough challenge in the wake of Siebel Systems Inc.'s recent announcement that it is launching its own hosted product, and with Salesforce.com's continued success, Close said.
In fact, the Siebel announcement helped push up FreeCRM's launch date, according to Stone.
CRM ASP Inc. is also offering an option that is not free. The paid service offers no ads, online support and 100 MB of storage space, versus the 5 MB in the free offering. The Professional version costs $9.95 per user, per month.
There will be no advertisements on the site until next year. The company doesn't have any yet, Stone said. Once users are signed up and demographics are in, CRM ASP Inc. will have a specific market of SMBs with which it can approach advertisers, Stone said.
The 14-employee company began production of the site in February and has beta-tested with a 100-broker insurance company and some real estate offices. Stone said that about 150 users signed up on the first day.
Among the available features are call automation with call scripting and e-mail campaign management. Multilingual capabilities and vertical markets are the next targets, Stone said.
According to Stone, the free CRM offering is the company's foot in the door to other products: licensed software, custom hosted applications and application appliances.
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