A web based CRM is typically using a cloud which is adopting some type of Software as a Service (SaaS) solution. That essentially means paying for a subscription, or contract, and viewing the service through a website/web browser. The major benefit with cloud or SaaS systems is that they’re normally a lot cheaper. You don’t have to pay upfront costs for hardware or licensing which makes these web based CRMs more affordable. Instead, the pricing usually is based on the number of users that are going to be registering for the service. That’s why a SaaS service is usually the best CRM for small businesses. The other nice thing about web based CRMs is that since you’re logging into it CRM through a web browser it is typically PC & Mac compatible.
One other thing to consider about the SaaS software is where the data is actually being stored. Is the data being hosted on a 3rd party vendor, or is the company hosting it on their own server? Different companies have different preferences. Typically, on a cloud solution the vendor is hosting the data on their servers. Sometimes it is outsourced to a 3rd party. In that case, you have more research to do because you’ll want to see what their reputation is and what their security protocols are. Keeping your data secure is obviously extremely important. Some companies want complete control over their data because they want to run their own security measures on it. That is perfectly fine. However, I wouldn’t advise going with a cloud based CRM at that point because you won’t be in control of security at that point.
All of the web based CRMs provide you with a certain amount of storage depending on the package you pick out. Storage generally isn’t all that expensive anymore, so if more is needed, most vendors don’t have a problem providing more for a minimal price. A problem arises if the vendor wants to charge an exorbitant price. I’d advise to check the market price for storage before you commit to anything.
The on-premise customer relationship management systems options typically involve buying the license and software to install on your company’s hardware. The costs upfront on this type of solution is much more expensive compared to any of the cloud based CRMs. A large company that needs more customization will probably pay an upfront cost to have ownership and not have to pay more in the long term. They would also be able to secure their data how they see fit. This solution typically means needing an IT staff on-site or possibly outsourced to handle maintenance, upgrades, patches, customizations, and various other requests from anybody within your company.
There is maintenance to the hardware the CRM is installed on along with all the network structure that would need to be in place to support it. Not only are you looking at purchasing the licensing, hardware, and/or anything else needed for the CRM, but you’re also looking at needing a staff to support the product after the initial installation and training by the company that owns the CRM software.
Having an IT staff that supports the CRM is beneficial in that you can always go to internal staff when something is needed or a customization needs to be made. Also, the IT staff would take care of all the maintenance on the server and network. However, these are all extra costs if you didn’t have an IT staff already. Another hiccup is that while all the customization that are needed when the CRM is first purchased will be there, but you would have to incur a cost for custom modules from the software company later on if you need to make a change. It becomes a bit more cumbersome when upgrades need to be done for that reason. 
Sandip
