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Marshall Lager The 2011 Year in Review—A CRM Recap

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By Marshall Lager, of Third Idea Consulting

The Year That Was 2011—Acquisitions, Recognition and Socialization Are Major Themes

It's been another busy year for the CRM industry, and nobody can be expected to recall every event. Before we move into 2012, it would be wise to take a look back at some of the forces that shaped the business landscape.

Building Blocks

The overall opinion is that 2011 was a year of recalibration. The previous two years had been rough, but the trend is now decidedly positive. We saw significant merger-and-acquisition activity in 2011, some of which is still unresolved. Communications and social vendors were some of the hottest properties.

Microsoft's $8.5 billion acquisition of Skype, announced in May and closed in October, gives the software giant an important foothold in collaboration and mobility. Similar plays by VMWare (which acquired microblogging and collaboration vendor Socialcast for an undisclosed sum) and Polycom (which purchased HP Video Conferencing Assets for $89 million cash) indicate that this is an area that will bear watching in 2012.

There was movement in the BI and data management space as well. HP completed its $12 billion acquisition of Autonomy in October, and also made a grab at Vertica for undisclosed terms. Oracle absorbed mobile commerce vendor ATG and KM vendor InQuira, and Infor posted a $2 billion merger with fellow ERP company Lawson.

CRM mainstay NICE Systems acquired EFM vendor Fizzback in September. The acquisition, valued at $80 million, is expected to augment NICE's command of customer experience and sentiment by adding voice of the customer insight in real-time, with direct, indirect, and inferred feedback considered.

As usual, the biggest acquisition news came from the largest forces in CRM. Salesforce.com made a series of acquisitions from December 2010 to December 2011. The first, Ruby development software company Heroku, gives Salesforce considerable depth in developing apps independent of its own platform. Salesforce next acquired DimDim, a collaboration vendor, in January for $31 million, augmenting its Chatter-based foothold in the enterprise. Then, the company agreed to acquire cloud services consulting company Model Metrics in November. The deal, expected to close in January 2012, will further add to Salesforce's mobile and social capabilities. Most recently Salesforce acquired Rypple, to be rebranded Successforce, and further contribute to the social enterprise as well as become the first cog in building out a cloud Human Capital Management (HCM) solution. But the biggest deal of all for Salesforce.com was the $326 million acquisition in March of Radian6, a social media monitoring and engagement platform provider. Monitoring is a strategic fit for the company's increasingly social offerings.

Oracle, which as previously mentioned acquired ATG and InQuira, dealt the market a surprise in late October when it announced its intent to acquire RightNow Technologies for an expected $1.5 billion. RightNow, a cloud CRM vendor that emphasizes customer experience and contact center technology, would add considerably to Oracle's credibility in cloud computing and social CRM, as well as provide a point of entry to SMB and midmarket customers. How RightNow rationalizes with Fusion remains to be seen.

More CRM Industry Awards

A pair of high publicity recognition programs got their start in 2011: CRM Idol and the Supernova Awards. Both seek to highlight the best new stories in CRM, but from different angles.

CRM Idol is a competition started by industry celebrity Paul Greenberg. Similar to the American Idol TV show from which it takes its name, CRM Idol gives a shot at the spotlight to newer and smaller vendors whose messages tend to be drowned out by established companies, or simply lost among their fellow upstarts. Contestants get face time to pitch some of the CRM industry's most influential voices, and can win various prizes including consulting services and free business software.

The Supernova Awards are sponsored by Constellation Research Group, the new analysis firm launched by respected analyst Ray Wang late last year. Supernovas are awarded to companies that best apply innovative and disruptive technologies to business problems in five categories: social business, mobile enterprise, cloud computing, advanced analytics, and emerging technologies. Submissions are judged by panels of experts in each respective field.

Social CRM Remains Big

Social CRM—business strategy and tools for engaging customers on their own terms through social networking applications, presenting a human face instead of a monolithic and disinterested brand—continued to rise in importance, with most vendors adding social tools to their arsenal or partnering with specialist providers.

Social technology use tends to look different at the extreme ends of business scale, with startups and small businesses able to gain the greatest relative benefit for the least investment. Social can be a low- or no-cost alternative to other community-building efforts, without a large outlay of money or time. Large enterprises, by contrast, have the resources to craft a much deeper experience that reaches potential customers at a number of points, and a good social app combined with a clever campaign can swing public sentiment in a brand's favor. In either case, social CRM efforts combined with sound traditional CRM practices have been game-changing for countless organizations.

2011 Conclusion

The world is starting to crawl back out of the recession that has held back economies for the past few years, and CRM is in part enabling businesses to regain lost momentum. Whether you felt 2011 was a year of growth or a year of confusion, it seems clear that the industry will hit the ground running for 2012. End

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A pair of high publicity recognition programs got their start in 2011: CRM Idol and the Supernova Awards. Both seek to highlight the best new stories in CRM, but from different angles.

 

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