Hosts With the Most (Partners, That Is)

ASP partnerships are aimed at giving customers robust CRM at a low price point. But are two vendors better than one? Several hosted--CRM providers have recently announced what they're calling best practices partnerships. These marriages are aimed at winning over customers to the ASP model. Their thinking is this: Customers get the best service from multiple providers at a fraction of the cost of a full enterprise implementation. Salesnet and Qualte, for example, announced they would partner to provide a combination of SFA and service/support capabilities. Peter Kim, CEO of Qualte, says that his company partnered with Salesnet because both companies were like-minded about not spreading themselves too thin. "Both companies wanted to focus on a best-of-breed approach and continue doing what we do best and not divide our own resources," Kim says. Following right behind that announcement was one made by Synergex, which announced a new CRM analytics subscription service called VisualSmart, intended to work with data generated by Salesforce.com. Some analysts say that ASP partnerships like these could spell trouble for more traditional CRM vendors. Karen Smith, research director with the Aberdeen Group, says that best-of-breed strategic partnerships are perhaps the best way for ASPs to add functionality and stay competitive. "Nowadays, software vendors need to be looking into forming partnerships that will benefit their customers by giving them exactly what they need in the way of best-of-breed solutions," she says. Smith also says that as more and more companies seriously consider hosted solutions, often because they can be less costly, vendors like Salesnet and Salesforce.com will be major competitors if they continue to partner with other companies to offer even more CRM services. Other analysts, like Erin Kinikin, vice president and research leader for enterprise applications at Giga Information Group, are more skeptical of the simplicity of these ASP partnerships in terms of integration of functionality. "Just gluing two CRM systems together doesn't create a unified customer strategy," she says. "Whether it's Siebel and SAP or Salesnet and Qualte, the issue is ensuring that the systems aren't just connected, but that they see the same view of the customer and can provide a seamless customer experience. "The reality is that there's really no way today to build a single, integrated CRM process and CRM customer data across two different CRM systems without a lot of manual integration work," she adds. "ASPs are great when the processes are fairly separate and the handoff points are clear. But make sure you can pull the data together for reporting, especially if you need to understand umbrella concepts like customer value."