With two extremely successful IPOs in the last six months from Salesforce.com and RightNow Technologies, CRM providers seem to have finally escaped much of the bad press the technology attracted in the late 1990s.
RightNow, which has been offering on-demand customer service applications since 1997, says it has attracted over 26 central and local government bodies in the last year including the London Underground, the Office of the Deputy Prime Minister and Imperial College, London.
But although more organisations are prepared to invest in the technology, this is still a turbulent sector for vendors and customers alike. Challenges for end users include whether to go with an established provider such as Siebel or PeopleSoft, or to opt for one of the newer providers pushing hosted or on-demand CRM such Salesforce.com, Entellium or RightNow.
And with consolidation the watchword for the software industry, the CRM landscape is bound to change substantially over the next 12 months. Microsoft is staking a claim in this market, which means fellow vendors are probably in for a rough ride. The firm has put a lot of marketing muscle into pushing its own CRM products aimed at small to medium-sized companies via its Microsoft Business Solutions division.
Another disruptive force on the horizon is the potential of open-source technologies to have the same commoditising effect on the business application layer as they have already brought to the operating system and infrastructure level -- a theory backed by Novell chief executive Jack Messman. Start-up open-source player SugarCRM recently launched its own hosted platform, claiming significantly lower total cost of ownership and more frequent product updates.
News: SugarCRM to launch on-demand offering
Experts believe this latest customer relationship management product could force down the cost of CRM and make rival vendors such as Salesforce.com raise their game
News: Salesforce adds customisation option
Dreamforce: Salesforce.com's latest software package will include CustomForce, which it says allows companies to tailor-make the application to their needs
News: Entellium puts new spin on CRM
The Seattle-based Entellium is going against the conventional wisdom by offering highly customisable CRM software
Q&A: CRM right here – RightNow
On-demand CRM provider RightNow Technologies claims it is the only true believer when it comes to hosted software
Q&A: Risking it all on Salesforce.com?
Dreamforce: Pat Sueltz, president of marketing, technology and systems at Salesforce.com, discusses why she considered the hosted CRM firm a sure enough bet to leave her successful post at Sun
Q&A: Siebel re-shaping plans laid bare
In a recent interview Mike Lawrie, the new head of Siebel Systems, explained his plans for the future of the company
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