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Zoho Corporation Company Viability Review

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Zoho Viability and Longevity

Zoho Corporation is a young, private, emerging growth organization. The company employs over 1000 staff, almost all developers in Chennai, India. Zoho has a small team in what it calls its headquarters in Pleasanton, California as well as satellite offices in England, China and Japan. Assessing the company's viability is more difficult than reviewing its much larger, public and more transparent competitors.

Zoho faces significant competition in each of the primary sectors which it competes.

  • In the online CRM software market, Zoho competes with the traditional cloud CRM vendors such as Salesforce.com and Microsoft Dynamics CRM as well as a host of low cost or no cost open source CRM vendors such as SugarCRM.
  • Within the online desktop apps market, Zoho competes with much larger and more mature companies such as Microsoft and Google as well as smaller entrepreneurial companies such as ThinkFree and Ajax13 and even open source solutions such as OpenOffice.org. Although the company's hosted office suite isn't as well known as its larger competitors, Zoho was actually the first vendor to offer several of the online apps services, beginning in 2005, and now supports over 3 million users with a portfolio of more than 20 applications. Clearly these larger competitors can out-resource and invest Zoho by a multiple factor, however, smaller companies such as Zoho can often out-innovate and apply a steadfast focus which advances software technology products in more meaningful ways and faster cycles.

Additional operational risks for Zoho Corporation include a young executive team beyond the CEO, challenged brand recognition, unclear promotional messaging, few meaningful alliances and questionable product innovation.

Zoho earns the majority of company revenues from two divisions—its ManageEngine unit, which focuses on enterprise IT management software, and WebNMS, which targets mobile carriers. Executive management believes that Zoho Office and enterprise apps such as Zoho CRM will represent a growing portion of revenue over time. Interestingly, when looking at software adoption as opposed to revenues, the company's communication and collaboration applications achieve the highest growth, with database connected applications such as Zoho CRM second in line. The product that often gets the most attention—personal productivity apps or Zoho Office, is ironically the slowest growth product.

The company suggests it achieves consistent annual growth and is profitable without ever having received outside capital.

Zoho Software Pricing

Zoho's pricing is semi-unique with a freemium model along with different pricing structures for different bundles of the CRM application. The CRM software is grouped into three editions—Free Edition, Professional Edition and Enterprise Edition.

  • The Zoho Free Edition permits a maximum of three users and includes the modules of sales force automation, marketing and customer service. Ancillary modules such as inventory management are not included, administration capabilities such as data and security management are minimal or absent, and many advanced functions such as workflow and auto-responders are not included. Additional charges for add-ons such as the Microsoft Outlook plug-in or Zoho Mail add-on are priced separately.
  • The Professional Edition CRM solution is priced at $12 per user per month and expands upon the Free CRM Edition with additional modules such as inventory and workflow management. Additional charges for add-ons such as the Microsoft Outlook plug-in or the QuickBooks integration are priced separately.
  • The Enterprise Edition is priced at $25 per user per month. This CRM version supports more sophisticated security permissions, offers more data administration tools and effectively includes every CRM function available from the company.

Upgrading from one CRM version to another is simple and performed from within the CRM application. To reduce risk, Zoho offers 15 day CRM software trial for all CRM versions and does not require long term contracts. Customers have the option of paying monthly or yearly.

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