Market Leaders: Midmarket Suite CRM
Midmarket companies—those with revenue between $100 million and $1 billion—are resuming recession-delayed CRM efforts, and “doubling down on their investments in customers,” says Forrester Research Vice President and Principal Analyst William Band. Now, with speed to deployment and ease of payment as primary goals, organizations are embracing software-as-a-service and supplementary technologies to get full value out of core capabilities. China Martens, senior analyst with The 451 Group, says she sees collaboration and social networking increasingly coming into the fold. A product such as Salesforce.com’s Chatter, she says, might even be better suited for a midsize organization than a huge enterprise.
Microsoft reclaims a long-standing leader position, and manages to boost scores in both company direction (up from a 3.9 to a 4.0) and depth of functionality (up from a 3.3 to a 3.8). Band says Microsoft’s strengths in functionality stem from its native integration with Microsoft Outlook and other pieces of the technology stack. The lower score in customer satisfaction—from 3.8 in 2009 to 3.4—reflects a perceived disconnect among customers, value-added resellers (VARs), and the vendor. According to IDC Group Vice President Michael Fauscette, customers are largely satisfied with VARs but don’t feel as connected to the Microsoft brand as they do to the partners that sell the solutions.
Narrowly missing the leaderboard in 2009 due to low depth-of-functionality scores, NetSuite is back this year. “[NetSuite] is definitely doing well in the midmarket,” Fauscette says, driven by “full-sweep purchases” by companies primarily seeking enterprise resource planning (ERP). “NetSuite’s [depth of functionality] is good enough for a lot of companies,” he says, rationalizing the company’s mediocre (but improving) 3.2 score there. “[NetSuite’s] big push this year,” Martens says, “is all around verticalization and customization of its ERP, especially financials and to some extent its e-commerce.” NetSuite particularly targets vertical markets, Band says, including wholesale and distribution, software, professional services, e-commerce, and, more recently, manufacturing. “NetSuite best suits organizations needing an all-in-one business application that spans the front- and back-office functions,” he says.
Oracle, often associated with massive-scale enterprise deals, continues to hold ground in the midmarket thanks largely to a Business Accelerator program providing rapid-implementation tools. Band attributes Oracle’s jump in depth-of-functionality score—a whopping 4.5 compared to last year’s still-high 3.8—to the company’s breadth of offerings: From Oracle CRM On Demand to Oracle Siebel CRM to Oracle E-Business Suite CRM and Oracle PeopleSoft CRM, the vendor claims to have something for everyone. Band says Oracle fares well in client referrals, and Fauscette notes it seems to be keeping VARs happy, who in turn, are keeping customers happy. The results are clear, with nearly a full-point improvement this year in its score for customer satisfaction.
In its sixth consecutive appearance on the leaderboard, RightNow Technologies’ scores largely resemble last year’s, with a bump in satisfaction to 4.1—an area where analysts say the vendor really shines. In fact, RightNow’s score in depth of functionality (3.6) may suffer because of its customer service focus. “The functionality they have is good, but most of the business is still more customer service than anything,” Fauscette says. The rating in company direction is second-highest among the leaders—due, in part, to the recent “CX Commitment,” a promise to ensure client success. “RightNow believes that it’s not enough to simply sell software,” Band says. “It must also be a partner in helping its clients mature their processes and achieve real business results.”
A hefty score in company direction—up from 4.2 last year to 4.6—helped Salesforce.com repeat its win here, with much of the buzz from its Chatter and Service Cloud announcements. The purchase of crowdsourcing, data-cleansing vendor (and 2009 CRM Rising Star) Jigsaw, Martens says, adds a lot of value for the midmarket customer. “[Salesforce.com] has been good at expanding its CRM presence over time,” Martens says—note the repeat 4.0 scores in satisfaction and depth of functionality—but there’s a risk of “paying less attention to [its] core sales force automation product and user base.” Band lauds the “rapidly deployable and…well-proven sales management and customer service CRM application,” but Martens says only time will tell if the company can balance the needs of its enterprise, midsize, and small-business customers as it moves into broader endeavors.
One to Watch
With all three of its ratings taking a hit for the second year in a row, Sage slides off the leaderboard. Cloud computing and Web services are in the offing—see “Sage Succumbs to Cloud Computing,” page 15—but The 451 Group’s Martens suggests Sage is “still trying to turn the on-premises oil tanker around,” and some say Sage has struggled with branding and product cohesion. Martens notes confusion over CRM strategy and the positioning of Sage CRM and SalesLogix, though low price points remain compelling. Forrester’s Band points to SalesLogix’s large user base, yet notes the product lacks strong capabilities in marketing, e-commerce, field service, and other areas. IDC’s Fauscette applauds Sage’s consistency, but laments not being able to see the effects of innovation just yet.