More Consolidation in CRM Space

 
 
By Dennis Callaghan  |  Posted 2001-01-22 Email Print this article Print
 
 
 
 
 
 
 

Corporate users of CRM software are bracing for another round of customer relationship management acquisitions and consolidations as well as attempts by vendors to differentiate their products.

Corporate users of CRM software are bracing for another round of customer relationship management acquisitions and consolidations as well as attempts by vendors to differentiate their products. As a result of this activity, users may have fewer vendors to choose from but more complete offerings from those that remain standing.

This month two notable acquisitions support these trends: Chordiant Software Inc.s purchase of Prime Response Inc. and Onyx Software Corp.s purchase of RevenueLab.

While Chordiant sought to round out its CRM offering by adding Prime Responses business-to-consumer relationship marketing automation technology to its suite of customer service and communications offerings, Onyx bought consultancy RevenueLab to add a services component to its offering to address the issue of CRM implementation failures. Officials at Onyx, of Bellevue, Wash., said this likely wont be the companys last acquisition and it is eyeing e-services companies.

Officials at other CRM software companies said more acquisitions are on the way. Siebel Systems Inc., in San Mateo, Calif., expects there will be no more than 10 companies left in the CRM market within two years, down from at least 60 today and 400 when Siebel was founded in 1983, officials said.

With stock valuations falling and the public financial markets closed to younger, privately held companies, the more established players in the space will be able to snap up smaller companies at bargain-basement prices, said David Schmaier, executive vice president at Siebel. "Its like the Christmas buying season. The longer you wait, the prices get better and better," Schmaier said.

Pivotal Software Inc., in Vancouver, British Columbia, is looking for acquisitions that will add content management, e-service and marketing automation capabilities to its CRM software arsenal, officials said.

PeopleSoft Inc., which entered the CRM space when it bought Vantive Software Corp. in 1999, has $1 billion in cash and a market capitalization of $14 billion. Both of these will help the Pleasanton, Calif., company if it joins in the acquisition game.

 
 
 
 
 
 
 
 
 
 
 

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