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Home > CRM / Call Center News > PeopleSoft launches new midmarket apps |
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PeopleSoft Inc. revamped its midmarket approach today with the release of 13 new applications -- including CRM software for sales, marketing and service -- aimed at companies that take in $50 million to $500 million in annual revenue. The Pleasanton, Calif.-based enterprise software maker launched the new products after having conducted research that identified a growing opportunity to sell to midsized businesses. The study from Market Partners Inc. in King of Prussia, Pa., indicated that 41% of all midmarket customers plan to increase spending on applications this year. "This is a huge but extremely fragmented market," said Jeffrey Read, vice president and general manager of midmarket operations at PeopleSoft. "It's really a tale of two different markets with sophisticated customers that simply have smaller budgets, and businesses looking for very simple solutions." PeopleSoft's answer lies with products that eschew any notion of what Read called "dumbed-down CRM." The company is emphasizing modular offerings that feature integrated functionality that can be turned on as customers' needs grow. "A company may only be interested in addressing its call center at the moment, but they understand the broader value of CRM down the road," Read said. He accused competitors such as Siebel Systems Inc. and Oracle Corp. of delivering "CRM lite" and said that their midmarket products do not fit the users' needs because they were not designed for specifically for them. On the CRM front, PeopleSoft is debuting new offerings for customer life cycle marketing, collaborative multi-channel selling and integrated service management. The company is also making available applications for financial management, resource and project management, sourcing, procurement, fulfillment, manufacturing, workforce recruitment, workforce payroll optimization and workforce rewards. PeopleSoft will tie together its midmarket software with a product called AppConnect, which features a user-facing portal and a no-cost integration broker embedded in the technology. AppConnect includes prepackaged reports and OLAP reporting. PeopleSoft will charge roughly $50,000 for each software package, with a typical "working robust system" coming in anywhere from $100,000 to $150,000, according to Read. The applications will be priced according to company size, allowing customers to extend functionality to unlimited numbers of users. PeopleSoft is recruiting a number of systems integration partners to implement the software, and Read notes these will be midmarket specialists and "not Big 5 players." The company will offer fixed-cost implementation, training and support. Each of the offerings is built using the same architecture as PeopleSoft's flagship 8.8 CRM product line. Delivering on the message Sheryl Kingstone, a senior analyst with Boston-based Yankee Group, thinks that PeopleSoft has the right message but that the company has yet to bring it to fruition with many midmarket customers. "PeopleSoft needs to prove they have scaled down the simplicity to a level where these midmarket companies will find their software an attractive alternative to what is already out there," Kingstone said. "The message of modularity and seamless integration will certainly resonate, but they need actual users." Kingstone said that PeopleSoft will compete with other enterprise vendors entering the midmarket, such as San Mateo, Calif.-based Siebel and Walldorf, Germany-based SAP AG. While 90% of all midmarket companies do not currently use CRM, she feels that the opportunity for these larger vendors is limited to the high end of the spectrum. "A $50 million company isn't going to buy a huge software suite; these vendors are going to be fighting over the $500 million class," she said. Kingstone said that CRM newcomer Microsoft would likely fare better at the low end. One mistake Kingstone believes PeopleSoft has made, much like many of the other vendors she sees crowding into the midmarket, is creating products based on broad demographic criteria instead of building software that meet midmarket buying patterns. "You can't generalize around the needs of companies in this space; they're quite diverse," she said. "Look at how many large companies are still using ACT contact management." Read said that one of the biggest challenges in designing CRM software for the midmarket is taking into account that many users in the space are still working with legacy systems that may be 10 to 20 years old. At the same time, Read said, this is why many of these organizations are interested in using CRM to ease long-standing integration and customer-tracking issues. PeopleSoft estimates that about one quarter of its customer base falls in the midmarket, including more than 40% of its new customers. PeopleSoft has had a midmarket division for six years. FOR MORE INFORMATION: The Best Web Links on PeopleSoft CRM IBM-Onyx hosted CRM partnership brings new dimension to midmarket
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