Update: Siebel looks to verticals to spur OnDemand growth

Siebel adds editions of CRM software for financial services, high-tech, life sciences, and automotive fields

Siebel Systems is continuing its push into the market for hosted business applications, launching on Tuesday four vertically tailored editions of its CRM (customer relationship management) OnDemand software. The company also released the sixth update to its year-old OnDemand application, adding new territory management and desktop software integration features.

Siebel's OnDemand industry editions are available for customers in the financial services, high-tech, life sciences, and automotive fields. That's a smaller set of products than what Siebel pledged to deliver last May, when it announced its forthcoming industry editions. At the time, Siebel planned to have eight industry editions out by the end of 2004, including versions for media and communications, manufacturing and consumer goods companies.

Siebel OnDemand and SMB (small and medium business) General Manager Bruce Cleveland, who joined the company in July, said conversations with customers and prospects led Siebel to decide to focus first on the four industry editions now available. The versions are created by adapting technology from industry editions of Siebel's traditional enterprise CRM software, and over time Siebel expects to release OnDemand versions of all 23 industries covered by its enterprise applications, he said. Cleveland declined to comment on which industries will be next available in the OnDemand portfolio, or when the next batch of industry editions will be released.

"We're not sure yet, but over the next few years, we'll make them all available," he said.

Sheryl Kingstone, program manager at the Yankee Group, lauded the new solution saying that Siebel has gone deeply into territory management and forecasting to appeal to management and built in a feature called Sales Guidance for the company sales force.

"At each stage of a sales cycle it [Sales force Guidance] recommends actions and brings up relevant content or case studies. It will help a new sales person get up to speed quickly," Kingstone said

Kingstone also said Siebel’s advantage will be in mixing on-premise solutions for use by headquarters with a hosted solutions for remote offices which typically have lower IT resources.

"They can all be managed using a similar data model," Kingstone said.

Siebel's industry editions are priced in North America at $100 per user per month, slightly above the $70 per month price tag of its standard OnDemand edition. Until Feb. 11, Siebel is offering customers a $30 per user discount on their first month's subscription to any of its industry editions.

San Mateo, California-based Siebel hopes its vertical customizations will help it stand apart from others in the hosted business applications market, including NetSuite Inc. and market leader Salesforce.com. Those vendors have so far stayed away from industry-focused editions, instead encouraging customers to do their own customizations or work with third-party partners to adapt the software to their needs.

"Enterprise customers tell us that their business requirements are unique and can't be forced into awkward Siebel-shaped vertical templates," said Marc Benioff, chairman and CEO of Salesforce.com.

Benioff added that Salesforce.com’s Customforce feature enables its users to customize applications specifically to their needs.

"The market is telling us that this is the ultimate vertical solution," said Benioff.

However, Denis Pombriant, principal at Beagle Research, said many companies do not have the expertise to build custom applications.

"If it is not your core business what are you doing it for?" said Pombriant.

In addition to deepening the software's feature set, Siebel's latest update to OnDemand includes several additional translations. Already available in American and U.K. English, French, German, Spanish and Italian, the software is also now on offer in Japanese, Simplified Chinese, Korean and Portuguese.

Citing the software's recent release, Siebel did not have any reference customers available to discuss their experiences with the new OnDemand industry editions.

Copyright © 2005 IDG Communications, Inc.

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