Hosted CRM looks to step things up

Computerworld - November has been a busy month for Salesforce.com Inc. The hosted CRM pioneer held its second annual user and developer conference, where it introduced a software upgrade that became available Nov. 15. San Francisco-based Salesforce.com, which went public in June, also reported third-quarter revenue of $46.4 million and raised the sales forecast for its full fiscal year.
And, perhaps most significant, the company announced a 1,500-user subscription deal with office supplies retailer Staples Inc. and a 2,000-user commitment from pharmaceutical services firm Quintiles Transnational Corp. Those are the seventh and eighth contracts that Salesforce.com has signed that involve more than 1,000 end users.
Salesforce.com CEO Marc Benioff said last week that he thinks hosted CRM is "now at the tipping point," with mainstream adoption of the technology starting to approach a critical mass of users. Rival vendors, such as Siebel Systems Inc., also are rushing to position themselves to take advantage of an expected upsurge in demand for CRM.
Chris Monica, senior vice president of sales and marketing at Houston-based EGL Inc., which operates under the name EGL Eagle Global Logistics, has already embraced hosted CRM. Monica said that three years ago, when EGL was looking for software to help standardize its global sales processes and make them more nimble, the $2 billion company decided to let someone else handle the IT headaches.
Until that point, EGL's 800-person sales force had relied on e-mail and other manual processes to track customer interactions and sales opportunities. Now sales personnel at the provider of transportation and supply chain information services use Salesforce.com's hosted applications. That has made it easier to share data, keep track of what's in the sales pipeline and coordinate marketing campaigns, according to Monica. "Salesforce.com has been a vehicle for the company to connect around the world in real-time fashion," he said.
The traditional knock on hosted CRM applications has been that they primarily appeal to smaller companies that would find installing and maintaining complex software from vendors such as Siebel or SAP AG a budget buster - as well as a potential technical nightmare.
A case in point is Document Sciences Corp., a Carlsbad, Calif.-based vendor of document management software with annual sales of about $25 million. David Barker, the company's IT director, said Document Sciences began using NetSuite Inc.'s hosted CRM applications 18 months ago and currently has about 70 workers accessing the software.
Prior to signing up with San Mateo, Calif.-based NetSuite, Document Sciences relied on a hodgepodge of third-party and homegrown sales and marketing applications,