Here’s something about Microsoft’s Q1 results that caught my eye: Microsoft Dynamics revenue grew 17% this quarter. Microsoft’s been marketing Dynamics hard over the past year, including the horrible “I Didn’t Get Forced” campaign, and it seems to be working.

Although Microsoft is a giant in certain key areas – desktop operating systems, office suites, etc. – it’s always seemed to me to be sort of an also-ran in ERP and CRM. It doesn’t have the foothold that Oracle and SAP have, nor the agility that Salesforce.com, Workday and a wide range of even newer companies. But it’s definitely gaining traction.

As part of his 2011 CRM Watchlist, Paul Greenberg wrote that Microsoft Dynamics had poor marketing even though it was becoming increasingly core to Microsoft’s revenue. “The Dynamics platform seems to generate, all in all, an ambivalent buzz in the marketplace,” Greenberg wrote.

The additional marketing dollars, even if they are going towards stupid ads, seem to be helping. But I’m still not hearing much buzz. But I suppose it doesn’t matter – there are lots of companies that don’t generate much buzz but are doing great (Zoho springs to mind).

Services Angle

Microsoft Dynamics CRM Online has proven to be a formidable competitor to Oracle Fusion CRM, SAP Sales on Demand and Salesforce.com. Soon Dynamics will have an internal activity stream that will provide some of the social features that its. One thing to watch for is external social media integration. If Microsoft can connect Dynamics CRM with Bing, not only could it provide some real-time intelligence, but perhaps it could provide some much needed revenue to the Online Services division. Just a thought.