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Chuck Schaeffer CRM Industry Month End Review—For May 2012

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Here's What Happened in the CRM Industry During May 2012

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SugarCRM SugarCon, SAP SAPPHIRE NOW, Marketo Summit & CRM Idol
CRM Industry May 2012 The CRM events that grabbed the industry's attention during May 2012 included SugarCRM's SugarCon, SAP Sapphire Now, Marketo's Summit and the kick-off of CRM Idol's second season. Here's my take-away for each of these events, and some musings about how these events shape the industry. Check back on the last of June for the next month's video CRM recap.


CRM industry highlights for May 2012:

  • SugarCRM concluded its annual SugarCon customer, developer and partner conference. Sugar used the conference to announce and deliver its next flagship product release, Sugar 6.5. This release continues the company's effort to improve the look and feel, the intuitive navigation and the UI by leveraging what we've all learned from consumer technologies for an improved UX. 6.5 also includes enhancements to the SugarLogic studio and a full-text search engine – which is particularly interesting, and unique among CRM apps, as Sugar is now using the search paradigm as a primary interface and navigation technique - a marked move from an applications marketplace which relies on prescriptive menu sequences for users to reach any particular CRM destination. If contextual search as a CRM navigation technique is intuitive, simple and effective in getting users to the right place in the shortest timeframe this may become a shift in how users more easily use their CRM app and which further contributes to the company's UX objectives and potentially to the dogged user adoption challenges that stress deployments and full system participation.

    Sugar also now supports IBM's DB/2 database and extended its social networking and e-commerce reach with integrations to IBM's Connections, WebSphere Commerce and Sterling Commerce applications. And while there were no official press releases, its quite clear that IBM is well underway in replacing its Oracle Siebel system with SugarCRM for 67,000 users. A shake up indeed, as Big Blue was the world's largest deployment of Siebel applications at one time.

    From a business performance perspective, the company is achieving predicted performance and showing that vision is in lockstep with the execution. Revenue growth maintained high double digit figures throughout 2011 and Q1 2012 began with triple digit revenue growth. In April, the company secured Round E funding of $33M, bringing the total funding to about $80M. This gives Sugar some very interesting possibilities as the company is already cash-flow positive. While clearly funds will be applied to development and scaling company operations, it would seem very reasonable to also expect some future news related to other uses for that cash. And the ecosystem also continues to gain traction. SugarCRM now has over 11M downloads, 1M users, 170K paid subscriptions, 30K registered developers, 1K projects on SugarForge, 400 VARs and 100 products on the newer SugarExchange. Next year's SugarCon will be moved to NYC.

  • SAP SAPPHIRE NOW 2012 made another trip to Orlando. CRM announcements were light. Sales OnDemand has increased its release schedule to quarterly. There were also announcements that Sales OnDemand includes integration with the on-premise SAP Business Suite and SAP CRM. SAP announced the GA of the Social Customer Engagement OnDemand solution. This solution begins to bring social CRM into the purview of marketing and service staff by facilitating engagement among social networks and online channels. While a good start, SAP remains a laggard in terms of marketing and service in the cloud. But the company does show some promise. Sales OnDemand is social CRM app with a role-based design, push-based live feeds, context-based activity streams and clear lessons taken from consumer technologies. With Sales OnDemand SAP has shown it can deliver social technology, but clearly the company has a lot of lost ground to make up.

    A big piece of SAPPHIRE 2012 was the introduction of Lars Dalgaard as cloud chief. Lars used his keynote to deliver what was called the SAP cloud strategy. In reality it was more a vision statement, but did begin to share some go-to-market and execution. SAP cloud solutions will now be subdivided into four lines of business to manage people, customers, money and suppliers. The intent of this four prong approach is to make the lineup more flexible and easier to acquire while not necessarily losing the opportunity for a seamlessly integrated ERP suite. It seems this strategy is in large part a result of SAP's belief that Business ByDesign has failed to take off because its too broad of an integrated business application system. Unfortunately, I think SAP has in part misdiagnosed this by not talking to enough people. Sure, if you talk to existing SAP customers who already have large investments in on premise SAP technology, they'll likely tell you they would prefer to purchase cloud solutions incrementally. This is a captive crowd this is in no hurry to replace what is probably the largest IT investment they have ever made. However, if you talk to the broader, global market, they'll tell you quite convincingly that they prefer a pre-packaged, fully integrated, out of the box, enterprise-wide business system over multiple systems that then have to be cobbled together. Its unclear if SAP's a la carte cloud strategy is a compliment to ByDesigns suite-based value proposition or whether this is more of new a new strategy to replace the prior. What is clear is that SAP still doesn't understand why ByDesign has failed to take off – which is the topic that one of my blog posts does answer – aptly titled SAP Business ByDesign, Why Good Products Fail to Launch.
  • Marketo held its 3rd annual user summit in San Francisco. It was well attended by about 1200 people and Marketo used the opportunity to announce Marketo Social Marketing – a release to make marketing campaigns inherently more social by using social propagation techniques to add lift to campaign reach and more accurately track content sharing through social channels. The business problem this solution is trying to solve is pretty clear – marketers and business leaders have long been frustrated by a lack of concrete measurability for social media and social marketing investments. Calculating the payback and ROI for social campaigns has been difficult at best. And what's inherently different here is that the Marketing Automation Software isn't just tracking how visitors are interacting with the brand's message on the brand's social page – something easily done – but how those visitors are sharing and interacting with the brands content in their own peer to peer social channels.

    These new marketing feature sets of course stem from Marketo's April acquisition of Crowd Factory and the suite's first offerings include Marketo Social Boost and Marketo Social Promotions. The Social Boost features include a Facebook Page builder, voting or polling applications, video sharing, social commenting, and ratings. The Marketo Social Promotions enable marketers to promote customer referrals, engage in sweepstakes, contests and "flash deals" that reach prospects in social channels, and then extend their reach to their prospects' friends and social sphere. There's also an interesting take here for improved influencer marketing. With with Marketo Social Marketing, marketers can now collect more detailed information about which people are sharing their campaign content and apply lead scoring techniques to determine who has the largest social reach and generates the most referrals. This information helps marketers identify their influencers and the measurable impact these influencers have on their business. With this information, they can craft more specific influencer campaigns to better engage this important constituency. End

That's a wrap. If I've missed anything, please let me know at chuckschaeffer[at]crmsearch[dot]com. Thanks!

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While there were no official press releases, its quite clear that IBM is well underway in replacing its Oracle Siebel system with SugarCRM for 67,000 users. A shake up indeed, as Big Blue was the world's largest deployment of Siebel applications at one time.



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