In-Depth

Siebel's

A repackaged CRM Midmarket Edition, the product's lower price should appear to small and mid-sized companies. Siebel is working with third parties to provide fixed-price integration and implementation services.

• By Stephen Swoyer
• 03/10/2004

Last week, Siebel Systems Inc. unveiled a substantially repackaged and re-priced version of its former Midmarket Edition CRM offering, which it calls CRM Professional Edition.

Siebel says that CRM Professional Edition is priced and designed specifically for small- and mid-sized organizations.

Siebel officials stress that the revamped offering shares many core features—such as sales, marketing, and service modules—with the company’s flagship enterprise packages. Because it has been especially careful to position CRM Professional Edition as a feature and functional descendent of its enterprise packages, analysts say that Siebel hopes to avoid the packaging and pricing problems which dogged its CRM MidMarket Edition offering.

So what’s different? For starters, says Justin Shriber, group product manager for CRM Professional Edition, the new offering runs only on Microsoft’s 32-bit Windows platforms (Windows 2000 and Windows Server 2003) and is optimized for Microsoft’s SQL Server 2000 (it also runs on Oracle and DB2). Siebel’s enterprise software packages, of course, run on Windows, Linux and several flavors of Unix, and also support a spate of relational database platforms.

“What we found is that customers are running on Windows, so rather than spreading our investment across a number of different operating systems, we decided that we would run exclusively on Windows,” Shriber explains.

Then there’s the pricing issue, long the sticking point for many mid-market customers. “What makes small- and medium-enterprise customers unique is that they have much less cash beneath them than some of these larger customers, and they don’t have the economies of scale, so a CRM implementation gone awry can actually make or break a company.”

Shriber says that Siebel plans to offer mid-market customers several financing plans if they are unable to afford lump sum payments.

Elsewhere on the pricing front, Seibel is working with resellers and systems integrators—such as Tier1 Innovation—to help provide fixed-price integration and implementation services. “We’re actually shifting risk from the customers who haven’t necessarily done this before over to integrators who’ve been doing this for years,” Shriber claims. “One of the things we’ve recognized is that if you can lock in some of the best integrators and resellers who really have expertise, you really can minimize the risk [of a CRM implementation].”

In addition to its sales, marketing, and service modules, Siebel lets customers choose from among forecasting, knowledge management, and e-mail marketing modules, as well. According to Shriber, Siebel will introduce industry-specific versions of CRM Professional Editions for the financial services and verticals, among others.

Finally, CRM Professional Edition customers can choose from among a conventional, on-premise CRM offering, a hosted OnDemand service, or some combination of the two, Shriber confirms. “The good news is that you don’t have to decide up front that you want to go with a hosted solution. You can purchase Professional Edition and then later on down the road make a decision to go with the hybrid solution,” he says.

Ian Jacobs, a CRM analyst with consultancy Current Analysis Inc., says that with CRM Professional Edition, Siebel has made an effort to address many of the shortcomings of its erstwhile CRM MidMarket Edition. “This time 'round, Siebel’s recognition that the mid-market wants the same depth of functionality as the enterprise will make it a much more attractive option for midsized customers looking to step up from hosted systems, contact management applications, or overstretched, home-grown applications,” he writes.

At the same time, he concedes, CRM Professional Edition’s overwhelming dependence on Microsoft technologies could amount to a competitive vulnerability. “Competitors such as SAP, PeopleSoft, and especially Oracle, can focus their messaging on the scalability of the database underlying their applications,” he points out.