In-Depth

Siebel Touts CRM On Demand

CEO says hosted CRM complements on-premise offering for small-to-medium enterprises, which tend to have more casual users.

• By Stephen Swoyer
• 12/03/2003

If there were any doubts about Siebel Systems Inc.’s commitment to its new CRM On Demand service, CEO Thomas Siebel did much to dispel them during his keynote address at last month’s COMDEX trade show.

A little healthy skepticism was probably in order. After all, the CRM giant had bucked the hosted CRM trend for about as long as was possible. When Siebel introduced a hosted CRM service of its own two months ago, it was careful to position the new offering as a complement to its conventional, on-premise CRM solutions.

Messaging from Siebel officials was consistent: We’re committed to hosted CRM, we believe that it has its place, but we feel that it’s also an effective complement to our on-premise offerings. “The real point is that if the customer wants both, let’s provide both and let the marketplace choose. We’re the first and the only software company in the industry to allow the customers to choose,” said Richard Reimer, director of product marketing for CRM On Demand, last month.

During his COMDEX keynote, Siebel took this message and ran with it, devoting the bulk of his near hour-long address to the new offering. “We see the opportunity to share customer processes and information through both integrated hosted and on-premise CRM,” he said. “Hosted CRM is an emerging market that we think offers a great deal of utility going forward, and we think that we can combine these technologies into these hybrids solutions offering large organizations the opportunity to utilize all of these [hosted and on-premise].”

At the same time, Siebel was careful to tout examples of customers that are deploying CRM On Demand alongside his company’s on-premise offering, citing one customer (National Australia Bank) that uses Siebel’s on-premise customer service, call center, and sales force automation applications. “At the same time they want to bring up their independent mortgage brokers around the world [on CRM], well the best solution for that is going to be a hosted solution out there on the Internet, kind of Siebel meets Google kind of deal, where you just bring up CRM On Demand and … you operate on the cloud, you track your leads, you track your opportunities,” he said.

And later: “Another utility of [CRM On Demand]—and this is quite important—is that it integrates seamlessly with the Siebel Enterprise on-premise applications. It also provides automatic migration from hosted to premise in case people want to do that,” he explained, noting that CRM On Demand “is very, very rich in its analytics capability, the analytics is really quite rich.”

As for market uptake, Siebel positioned CRM On Demand as a small-to-medium enterprise (SME) play. “Clearly, the Siebel CRM On Demand solution is designed for the middle market and the lower end of this market … these tend to be more casual users,” he said, later adding: “It’s really designed to meet the utilities of divisions of large organizations, small businesses, and businesses that are starting up.”

Siebel also discussed the acquisition of hosted CRM provider Upshot, which his company picked up just weeks after the CRM On Demand announcement. “This is part of our strategy to establish a leadership position in the hosted CRM market,” he said.

Siebel said that his company will support Upshot customers who want to keep using the company’s existing services, but will also introduce a no-cost upgrade to a combined Siebel-Upshot offering. “For those people who want to use the existing Upshot product, we will continue to support them indefinitely. ….If you intend to stay on your current version of Upshot, we will support it as long as you want to use it, at the same time we will offer you the opportunity to upgrade at no cost to the follow-on product that we’re working on with the Upshot team.”