Siebel, IBM Team on CRM

Siebel systems inc. is taking another run at hosted CRM. Following its unsuccessful Sales.com hosted customer relationship management service a few years ago, the CRM vendor is now rolling out a new service in conjunction with IBM.

Siebel CRM OnDemand, announced last week, will enable businesses to manage information on contacts, sales opportunities, products, prices, competitors, events, marketing campaigns and customer service requests. It is being positioned as an easier-to-use and faster-to-deploy alternative to licensed software.

CRM OnDemand will be marketed to small and midsize businesses and priced at $70 per user, per month. Nevertheless, Siebel, of San Mateo, Calif., and IBM, of Armonk, N.Y., describe the software offering as "enterprise class" and promise integration and automatic migration to licensed Siebel applications.

The companies will jointly develop the service. IBM Global Services will provide the hosting services.

Siebel plans to market the services primarily to its existing customers, said Vice President Richard Gorman. He expects many of Siebels enterprise software customers will deploy Siebel CRM OnDemand at the department level to extend the reach of Siebel software to areas that the licensed version hasnt penetrated.

The hosted service can then integrate easily with the licensed version, Gorman explained, a key differentiator between Siebel CRM OnDemand and existing hosted offerings from companies such as SalesForce.com Inc., UpShot Corp., NetSuite Inc. and Salesnet Inc.

Siebel intends to target small and midsize businesses, as well.

Gorman said the new offering, slated for availability by December, goes well beyond Siebels last foray into hosted CRM services, Sales.com, which launched in February 1999 but was closed in July 2001.

"Sales.com was basically a place where you could type in your personal accounts and contacts, but you couldnt share them with the rest of your sales team," Gorman said. "This is a completely different end-user experience. You can share information with groups right out of the box."

Forrester Research Inc., of Cambridge, Mass., predicts that hosted CRM services will experience double-digit growth this year, while the overall CRM market will decline by 15 to 20 percent. "Siebel has to have a hosted CRM offering to compete in hosted deals, most of which are business-, not IT-, driven and can lead to larger deployments later," said Forrester analyst Erin Kinikin.