Omniture Set to Acquire Visual Sciences

The pool of Web analytics providers continues to shrink.

by Jean Thilmany

The Web marketing technology space continued its trend toward consolidation last week, with Omniture announcing plans to acquire Visual Sciences for $394 million.

The move solidifies Orem, Utah-based Omniture's spot atop the shrinking list Web analytics players, and means other marketing-software vendors will look to integrate their products with Omniture before turning to other integrations, says Bill Gassman, research director at industry research firm Gartner.

Boasting a client list that includes eBay, General Motors, Microsoft, and Sony, Omniture's SiteCatalyst product helps electronically measure Web-site traffic, visitor activity, advertising effectiveness, and e-commerce transactions. Other products give customers access to business data in real time. San Diego-based Visual Sciences offers Internet-based businesses a tracking service that measures and analyzes Web-site activity. The data it collects can help improve marketing, e-commerce, and customer support, according to company statements. (Until May of this year, Visual Sciences was known as WebSideStory, which acquired the Visual Sciences name and technology in February 2006.)

Companies that operate on the Web -- and that includes just about every company in business today -- rely on analytics tools, Gassman says. Tools such as Omniture's look for Web trends that are vital to planning targeted marketing campaigns. "The more your business depends on online channels, the more you need analytics because that's the way you understand your business," Gassman says.
But smaller companies need not pay costly software-as-a-service (SaaS) fees to access those tools, he says. Instead, companies with fewer than than 5 million page views per month can use Google Analytics for free. Since its introduction a few years ago, the Google product has fractured the Web analytics market: Large companies and those with an entirely online presence -- think eBay -- now use products such as Omniture's, while smaller players turn to Google Analytics.

As the number of Web analytics providers (all following the SaaS model) that cater to big businesses continues to shrink, companies looking to analyze and track visitor activity on their Web sites have fewer software options to choose from. But the remaining analytics providers increasingly boast a broader solution set that covers more tracking, analysis, and Web marketing bases than in the past, Gassman adds.

"And here we have number one buying number two," he says. "What that means is [that] vendors of other online marketing programs will make the effort to integrate their products with Omniture first. They'll pick up other Web analytics platforms later." Examples of online marketing applications that can be integrated with Web analytics software include targeted email programs and marketing planning software. Those applications use Web analytics information to populate their own applications.

Josh James, Omniture's chief executive officer, says his company's fit with Visual Sciences is a natural one. The companies' combined analytics and tracking technologies will offer a stepped-up set of solutions that can meet customers' expanding needs, he says.

"We're facing a very significant opportunity defined by the rapid growth of online advertising and online business in general," James says. "This acquisition enables Omniture to accelerate our investments in advanced solutions that drive customer success as well as create further opportunities to cross-sell our growing portfolio of products to a combined customer base of more than 4,000 customers."

At least one other marketing-technology executive agrees that consolidation is a good thing for the industry. Luis Rivera, chief executive officer of marketing software provider J.L. Halsey, says Omniture's move is indicative of what he calls the "vitality" of the marketing sector, including his own company's recent spate of acquisitions (Lyris Technologies, EmailLabs, ClickTracks, and Hot Banana). "Technology today makes it easier than ever for marketers to acquire customers and drive increased ROI through more relevant, behavior-based marketing programs," Rivera says, in a written statement. "But every technology tool at a marketer's disposal -- Web analytics, content management, and email marketing, to name a few -- is made more valuable when it works in concert with all the others. That's what this wave of consolidation is all about."

CRM Is Up Down Under

New research shows Australia leading the adoption of CRM software in the rapidly expanding Asia-Pacific market.
by Colin Beasty

CRM software revenue in the Asia-Pacific region will grow at a compound annual growth rate (CAGR) of 16.8 percent from 2006 to 2011, according to a new study recently released by Gartner. The firm's research, which highlights the region's expanding importance for CRM vendors, found Australia leading the way in CRM, claiming 42.8 percent of Asia-Pac's CRM market in 2006.

The Asia-Pacific region's strong uptake of CRM is being fueled by growth across all subsegments, Gartner's findings show -- with marketing, in particular, laying claim to 23.5 percent of CRM software revenue. And unlike the United States or Europe / Middle East / Africa (EMEA) -- regions that are experiencing explosive growth in software-as-a-service (SaaS) -- the Asia-Pacific market has, to date, been relatively old-school, driven by traditional deployments of installed software, says Denise Ganly, an analyst and research director of enterprise applications with Gartner. "The [Asia-Pacific] market is relatively immature compared to North America and EMEA," she says. "SaaS and on-demand hasn't taken off in the same way, and in many Asian countries this will not likely change due to the cultural barriers associated with such a deployment model."

Despite the so-called immaturity, Gartner expects market consolidation and burgeoning on-demand use to stimulate CRM expansion overall in the region. Australia in particular will experience continued growth -- especially organic growth -- thanks in part to what Gartner sees as the country's strong IT infrastructure and partner channels for CRM vendors, as well as the availability of integration and support services.

"The Australian market will continue to grow as end users extend their applications beyond ERP, but the market will also experience growth because of the continued adoption of on-demand solutions, as well as CRM solutions for self-service customer support of campaign management," Ganly writes in the report. "Even in Australia the CRM market is relatively immature, with a lot of potential for organic growth. Companies across the Asia-Pacific region are focusing on analyzing customer data and trying to gain the whole view of the customer, rather than embarking on [automation] for their sales force."

Recent research by Gartner also highlighted the growth of business intelligence (BI) software in the Asia-Pacific region. The BI market grew 16 percent in 2005 to reach $491.8 million in 2006, with Japan accounting for more than half of that overall growth. India was listed as the fastest-growing BI market, with software revenues for BI platforms reaching $16.4 million in 2006, up from $12.1 million the previous year. In many ways, CRM and BI software are growing hand-in-hand, Bhavish Sood, a principal analyst with Gartner, writes in the report. This sort of software is "nice to have" as businesses in the Asia-Pacific region continue to develop beyond basics such as ERP and accounting software, he says.

CRM Remains a Fertile Market

New research points to explosive growth in CRM adoption across every segment -- especially on-demand CRM.

by Demir Barlas

Forty-two percent of U.S. companies are using CRM, according to new market research from the consulting firm KensingtonHouse, and the percentage just keeps on growing. Even more notable, in terms of current and future growth, is the fact that CRM's "market fertility" -- the percentage of companies deploying, upgrading, or actively considering a CRM purchase -- stands at 38 percent, according to the report.

The market-fertility figure is the metric KensingtonHouse chose to highlight, as it reveals a record number of companies deploying or planning to deploy CRM. "This is significantly above what I've seen historically, which has been 18 to 25 percent fertility," says Thomas Moriarty, the consultancy's president.

According to the survey, the main reason for the current wave of CRM popularity is the maturity of the on-demand delivery model and functionality set. Fifty-five percent of respondents expressed a preference for on-demand, with a mere 14 percent nominating on-premise and 31 percent undecided. Eighty-seven percent of survey respondents were either small or midsize businesses (SMBs), but Moriarty says that the preference for on demand extended to the enterprise segment as well. The research, sponsored by Microsoft CRM partner T.H.G. Sales Automation, canvassed 437 respondents representing a population of 20,000 companies with a degree of accuracy of plus or minus 5 percent.

On demand is succeeding because of both its low cost and its simplicity, Moriarty says, adding that KensingtonHouse estimates the model can lower the cost of a CRM deployment by as much as 60 percent while also offering an increasingly user-friendly experience. "Customization is so easy now that you don't have to be a bits-and-bytes guy to go in and create all kinds of different fields, reports, and dashboards," he says.

While on-demand initiatives may be easier to implement than on-premise ones, adopters of either variety should still be aware of the significant risks of project failure. Gartner recently predicted that, by the end of 2008, "25 percent of CRM projects will be postponed or canceled because of the CRM skill shortage in consultants and systems integrators." While this sounds like an inordinately high number to industry outsiders, Moriarty emphasizes that it has to be taken in context. "Three years ago, that number would have been 75 percent," he claims.

The good news is not only that the ecosystem of CRM consultants and systems integrators has matured through continued CRM implementation success, but also that CRM adopters can control their own fates by making CRM an institutional priority. The recent Management Tools and Trends 2007 report from management consultancy Bain & Co. revealed that companies that put more effort into CRM up front (including long-term planning, unwavering executive sponsorship, and diligent change management) get more out of the technology. In the Bain survey, those companies who put a "major effort" into CRM reported a 4.17 satisfaction score on a five-point scale, while those putting in a "limited effort" were only able to achieve a 3.53 score.

That data point alone should convince any CRM adopter aiming to maximize return on investment to enter into the implementation prepared and willing to put in some heavy lifting. "You have to maintain the quality of data and make sure to load a good set of business rules that specify how the system is going to be used," Moriarty counsels. "You have to do the work."

Market Focus: Technology -- The Simple Truth about Complex Manufacturing

Tech firms need CRM as much as any other company--and sometimes even more.

by Marshall Lager

There's a long-standing (and wrong-headed) belief that CRM technology can be a cure-all for a company's operational woes. There's an equally long-standing (and equally wrong-headed) perception that high-tech manufacturers and vendors don't need CRM. Not only is the 360-degree view of customers, partners, and processes important in the technology vertical; it's made tricky by the complexity of the business models and by the roots of those misperceptions.

In the first place, every business needs CRM, even if only to manage customers' account histories and communications -- CRM grew from contact management, after all. Why, then, the idea that tech businesses don't need it? "It's not as much a process vertical [as] financial services," says Tim Hickernell, senior research analyst, applications, Info-Tech Research Group. The focus is on the products themselves -- and since tech salespeople are often former engineers, they're less likely to be relationship-driven.

This is a dangerous reduction of the situation. Even in the tech world, says Diane Albano, vice president of Americas operations at Progress Software, "People are still selling to people, trying to solve a problem." Progress promotes sales effectiveness of businesses across many verticals, and Albano says the key is communicating. "If you can get that message across to your team, you'll have happier customers and more motivated workers."

Using and contributing to the CRM system, remembering that business is about the customer and not the product, are basic elements that haven't become as ingrained among tech firms as they have elsewhere. Fortunately, fixing issues around adoption and technique among techies requires largely the same effort as it does in other verticals. "You must make it mandatory -- it's not up for debate. But do it in a gentle, prodding way, not with yelling," Albano says. "Show how you're enabling salespeople in order to make them understand why it's necessary."

Beyond adoption, Hickernell notes where tech companies are different from others in terms of CRM. "Selecting the right CRM components is more important," he says. "Channel management and knowledge management are important considerations. There's a very complex value chain -- relationships are at least B2B2C," he says, and often reflexive, where two manufacturers sell each other their products. "Work is spread across the value chain, involving original equipment manufacturers, original design manufacturers, and even different divisions of a single company selling to itself as an internal customer." This means careful tracking of channels, and a firm grasp on information at all stages with knowledge management.

This becomes apparent in engineering-to-order processes. "We maintain virtually no finished goods in stock. Almost all orders we take require engineers to be involved before production begins," says Phil Shields, senior analyst at K&L Microwave, a manufacturer that uses CRM software from IFS. "They may be involved in the quoting process, determining if we can even build a product to the customer's specs, providing technical data or preliminary drawings. After we receive an order, engineers will design the new product; even for repeat orders, engineers many times need to check the documentation provided by the customer to make sure there are no changes since the last time."

Prior to implementing sales-and-marketing functionality, K&L was generating quotes with the IFS ERP system. "This required us to create a customer, sales part, and inventory part just to create a quote," Shields says. "Integration with our ERP system was one of the big reasons we selected IFS's CRM system." Requiring zero programming or customization, all customers, sales parts, customer orders, and invoices are now available within the CRM system. "The IFS CRM system has given us one place to put information, both customer-furnished and K&L documents, so that everyone in the company can access it," Shields says.

Knowledge management and dissemination also comes into its own in high technology. "The expectation for self-service, especially Web self-service, is much higher in this vertical," Hickernell says. "The customer is much more savvy, and more is expected of the vendor. If an error message is programmed into a piece of technology, the customer expects there to be a knowledgebase article for dealing with it."

Advertising is low on marketing budget list, survey shows


Advertising accounts for just under 15 per cent of marketing spend on average and marketers plan to spend less in the future - so says a marketing trends survey from the Chartered Institute of Marketing (CIM), based in the UK.
The other marketing activities attracting significant budget include lead generation (12 per cent), CRM (12 per cent) direct mail (11 per cent), field marketing (11 per cent) and internal marketing (seven per cent).

The survey found that marketers plan to increase their spend on online marketing in the current sales year by an average of 3.6 per cent, CRM by two per cent and public relations by 1.5 per cent. However, they plan to reduce their spend on advertising by 0.2 per cent.

Although marketers who were surveyed plan to spend more on online marketing, digital communication was used by only one in 12 companies at least 'a fair amount'.

Geoff Hurst, marketing director at the CIM, said: "It's interesting to note that a significant majority of marketers are still not making use of the full spectrum of technologies available to help them communicate with customers. In fact, the numbers answering 'not at all' when asked how regularly they used podcasts, corporate blogs, mobile marketing and viral marketing, have actually increased since the survey was last conducted in autumn 2006.

"While traditional marketing techniques will remain important tools for marketers in the future, it will be interesting to see how these figures change when we carry out our next survey."

Toolkit Tutorial: Getting Value From SFA Applications

The develop, education, assess and learn (DEAL) approach will help sales organizations achieve the elusive business value they seek in their sales force automation (SFA) deployments. There is no guarantee of a return on investment (ROI) for IT projects, but the DEAL approach will better prepare your sales organization to define expectations, adopt realistic measures and achieve tangible benefits.

Key Findings
  • Developing and continually measuring meaningful sales metrics tied to business goals are key to showing value in SFA deployments.
  • Setting realistic expectations and gaining consensus on the needs of sales management and salespeople are critical to securing, buying and pursuing attainable business goals.


  • Develop meaningful sales metrics tied to business goals (rather than to sales activity); this is key to showing value in SFA.
  • Continually measure, interpret and take action based on sales metrics; this makes these metrics "meaningful."
  • Create reporting processes to assess achievement against metric goals that are nonintrusive and don't burden salespeople.
  • Establish a feedback loop technically, via a community site, or organizationally, through sales support, and use the data collected to tweak the metrics, processes and SFA system.



The DEAL approach is a process that will improve the ability of a sales organization to capture and continually improve the value (for example, through increased sales, lead conversion rates and shorter sales cycles) attained from SFA deployment.

The top question Gartner receives about SFA is: How do you measure ROI for SFA? Even in cases where user adoption approaches 100%, sales organizations struggle with understanding the value delivered by their SFA to the sales organization. Sales executives often say they have improved visibility, or more accurate sales forecasts, but they cannot translate these "soft" benefits into real revenue or margin improvement. The primary difficulty in determining value is that there are many parameters besides the technology that will determine performance. Devising the right sales process, developing optimal sales territories, creating the correct incentive compensation plans, or just having good products or services to sell have significant, if not decisive, impact on sales performance and outcomes. However, the variability in nontechnical factors should not excuse organizations from measuring the success of an SFA deployment. The Gartner DEAL approach, when followed, will improve the ability of sales organizations to benefit from an SFA deployment.

Assumption: The Gartner DEAL approach focuses on the deployment of SFA. The assumption is that a sales organization already has implemented a sales methodology and has developed territories and compensation plans to pursue business goals. The DEAL approach is designed to provide insight into the effectiveness of sales strategies to enable you to make refinements.


The "develop" phase of the DEAL approach is the most critical and should not be circumvented. In this phase, your sales organization will determine the sales metrics to be tracked and measured during the life cycle of the deployment. The metrics are not for management only but also for salespeople. The intent of the metrics is to provide insight for all system users, to determine whether they are receiving value that is meaningful to them (such as increased close rates for salespeople). Each industry has specific metrics they consider most important; however, some basic metrics tend to be common. For sales management, metrics may include lead conversion rate, confidence levels in forecast pipelines/pipeline health, opportunity funnel velocity (the time it takes for a sales opportunity to move from qualification to close), opportunity close rates and new salesperson ramp-up time (the time it takes a salesperson to be as a effective as comparable performers).

These metrics are not meant to replace analytical reporting on sales performance, where managers gain forecast insight into such issues through win/loss reports, or specific territory performance. The sales management metrics for the SFA project are intended to focus more on the effective use of technology. For salespeople, metrics may include sales content effectiveness (which sales content has been proved most effective in winning new deals), lead quality/source conversion (which lead sources have proved most valuable for sales opportunities), sales methodology effectiveness and activity-based forecast collaboration (helps salespeople measure how well their committed forecast maps to committed sales activities). This is not an exhaustive list of metrics but provides a general guideline to determine the type of metrics your sales organization should consider.

In general, sales objectives and associated metrics tend to be focused on:

  • Acquiring new customers more effectively
  • Cross-selling
  • Improving margins per sale
  • Reducing costs of sales
  • Retaining or reducing the churn of established customers
  • Selling more frequently
  • Upselling

Top-line financial metrics must be supported by operational sales metrics, which are more difficult to select and monitor effectively. (See Note 1 for examples of sample metrics that enterprises have used to gauge performance in their sales initiatives.) A key issue in SFA projects for field sales is user adoption. These performance metrics can be augmented by measuring activity and operational metrics, such as the number of people accessing the total functionality of the system and system adoption rates. Sales organizations should develop and distribute activity metrics, in addition to performance metrics, to salespeople to enable them to thoroughly understand their sales results, as well as why these results are occurring.


Education is critical to the success to any SFA project. Most SFA training is focused on how to use the application, such as explaining the mouse clicks to create an opportunity, or the menu item needed to associate a contact with an opportunity. These are important elements in the successful use of the SFA application, but if this is all you do, then you will be destined to poor adoption, or to obtaining subpar value from the technology.

Ideally, the SFA application would be rolled out at an annual sales meeting, with a launch theme that reflects the value statement and metrics. However, if the timing does not work, e-learning and smaller, regional training groups will work as well. The goal is to create shared ownership of the application, not a top-down management mandate of forced adoption. Before you show the application during sales training, explain the value each person should receive and how he or she will be able to measure that value while using the SFA tool. Once you have buy-in for the value, you can proceed to teaching the mechanics of using the application.

Other key value-added tasks during the "educate" phase:

  • As you hire new salespeople, first reinforce the value proposition of the SFA application before teaching them how to use the system. The one-on-one or peer-to-peer training approach is optimal for bringing a new salesperson up to speed on the SFA system and goals.
  • Build case studies into the learning modules to simulate the steps, stages and effective use vs. required use.
  • For e-learning, include just-in-time learning nuggets that require five minutes or less and will address an immediate problem.
  • Have a hot line to sales support for help prominently showing (for example, at the top) at all times in the application.
  • Offer e-learning capabilities within easy reach (not buried within the help function) so that training can be accessible to those who wish to help themselves.
  • Validate system usability with a select group of achievers.


Once the metrics are determined, you must put in reporting dashboards to collect the data, to report and review on it a weekly, monthly or no-less frequently than quarterly. The frequency of the reports will depend on the velocity of the business. Specific metrics may have different update cycles. The ultimate test of the metrics you have defined is whether you can assess the progress of the metrics against sales goals, such as revenue, market share or earnings. To demonstrate the value of SFA application, metric reports must show the association between organizational and personal objectives.

The quandary surrounding the "assess" phase is capturing experiences, which can be an art in itself, because you do not want to overburden salespeople with tasks such as entering large amounts of data into opportunity management systems, recording forecasts, or fulfilling administrative tasks. Thus, the key is limiting the demands placed on salespeople, while still capturing the relevant sales experiences and insights that lead to good sales activities and processes. This requires setting up an architecture that may rely on a single database or a set of federated databases, typically capable of handling alphanumeric and text data types, to incorporate data points, feeds and perspectives from different systems.

  • The system should have analysis tools to capture insights on lead quality, pipeline health, documentation quality, presentation resonance, proposal resonance and best practices on the most propitious timing and context for applying sales resources to an audience in a sales cycle.
  • The system should be set up to support taking the insights captured in the analyses stage and translating key findings into effective guidance that is communicated via key systems (such as proposal generators, presentation Web sites, opportunity management systems and sales team Web sites), or is introduced in initial training and continuing education programs, and if serious or significant enough, then delivered orally in team meetings.

The "assess" phase is not just a management activity; it is imperative that salespeople have a view into their personal metrics to determine the value of the sales force application and how they compare to other salespeople using the system. The view into the metrics should be provided as part of the SFA system user interface. For example, if only 5% of sales content produced is effective in closing sales, then this will be readily apparent to all concerned. This will enable the organization to take the information and move to the next phase – "learn" to take action.


After assessing progress against the defined metrics, its important for the sales organization to be oriented toward becoming a learning organization that can effectively discover key trends and facts from information and can take corrective actions to improve practices and outcomes. For example, if the lead conversion rate is 40% below goal, and the two or three lead sources are the main cause of the problem, then the sales organization can make the appropriate adjustments to their lead source investment and can begin improving conversion rate. Ultimately, this will improve the quality of leads, which will, in turn, improve salesperson "stickiness" of the application and will increase value. The bottom line is that SFA is a continual deployment process that must be adjusted and tweaked as values for key metrics are reported.

A key element of continuous learning is interviewing and surveying sales teams. This could include having technical or marketing or sales support personnel listening to or attending sales calls to witness approaches to selling. In addition, consider one-on-one interviews with overachievers who are willing to share the secrets of their success by sales support (preferably sales operations personnel or business analysts) or marketing resources. Finally, have team managers, or first- or second-line management, polling selling personnel on what does and doesn't work. IT should have resources dedicated to detecting problems with technology and capturing requirements from a technical perspective. For example, "This interface is confusing, and all I want to do is get to my last five favorite presentations."

Key Facts

  • Most sales force applications fail to show measurable ROI.
  • A major cause of poor ROI is limited or no investment in evaluating metrics for success.
  • Metrics and reporting that result in no actions probably need redesign.

Note 1 - Same Sales Metrics

  • Amount of recurring revenue
  • Close rate
  • Days sales outstanding
  • Margin
  • Number of cross-sells
  • Number of new customers
  • Number of open opportunities
  • Number of proposals given
  • Number of prospects
  • Number of retained customers
  • Number of sales calls
  • Number of sales calls made
  • Number of sales call per opportunity
  • Number of upsells
  • Profit by customer
  • Renewal rate
  • Revenue by channel
  • Sales cycle duration
  • Sales stage duration
  • Time to close by channel
  • Competitive knockouts
  • Deal margin
  • Wallet share

B2B marketers ignoring customer databases

By Robert Jaques

Business-to-business marketers have "plenty of room for improvement" when it comes to using customer and prospect databases for direct marketing purposes, new research claims..

An online survey conducted by marketing communications agency Godfrey found that B2B marketers could make their direct marketing campaigns more effective by combining web 2.0 technologies with customer and prospect databases.

Lynne DeMers, strategic direct marketing team leader at Godfrey, said: " Direct marketing is not about sending 20,000 mailers to a rented list and hoping for a two per cent return."It is about creating a programme and a system of messages, offers, information capture, measurement and refinement."

It is a direct communications 'roadmap' of continuous cultivation that provides more targeted information and leads prospects to the point where the sales channel can take over."

The poll found that 80 percent of B2B marketers maintain a sales lead or inquiry database, but only 55 percent use it regularly for direct marketing. In addition, only 40 percent of B2B marketers regularly engage their inquiry database via email or an e-newsletter.

Only 60 percent use their customer database for targeted direct marketing, and only 40 percent regularly update customers with new offers.

While mass direct marketing techniques typically yield response rates ranging from 0.5 to two percent, targeted direct marketing technologies are considerably more effective, according to Godfrey.

B2B marketers can realise 40 percent open rates, 10 to 20 percent click rates and opt-out rates of less than one per cent with segmented email marketing and e-newsletter campaigns.

Copyright © 2007 vnunet.com

SaaS CRM Market in Asia Estimated to Grow 68% in 2007

Market expected to grow to US$460 million by 2010

Singapore – December 7, 2007 – Springboard Research, a leading innovator in the IT Market Research industry, today announced results from its latest research covering the Software-as-a-Service (SaaS) Customer Relationship Management (CRM) market in Asia (excluding Japan). Springboard estimates that the SaaS CRM market will grow at a compound annual growth rate (CAGR) of 61% between 2006 and 2010. Springboard pegged the SaaS CRM market in Asia at US$69 million in 2006, and expects it to reach US$460 million by 2010.

Australia, Singapore, Hong Kong, Korea, India, and China are the key SaaS CRM markets in Asia Pacific. Of these, Australia remains the top market, accounting for 35% of all SaaS CRM sales generated in the region.

“SaaS CRM has gained acceptance in Asia’s business mainstream and the coming year will see higher adoption rates as larger enterprises opt for SaaS CRM,” said Balaka Baruah Aggarwal, Senior Manager for Emerging Software for Springboard Research. “At the same time, the market is set to witness unprecedented growth in the SME sector as a spate of new initiatives by vendors such as SAP, Microsoft, and Oracle promote their CRM offerings,” added Ms. Aggarwal.

Increased adoption among larger enterprises will be the turning point in the uptake of SaaS CRM and will bring the model a legitimacy that it did not have when it was mainly used by small and medium enterprises (SMEs). Already, leading vendors like Salesforce.com, who had traditionally targeted the SME market, are now eyeing larger enterprises. As traditional software players step up their activities by offering proprietary SaaS CRM applications, large enterprises will be lured to the market, creating an entirely new base of customers who had previously been fence sitters. Springboard Research also forecasts that the SaaS CRM market is set for consolidation as the number of players increase and bigger players make serious forays into the marketplace.

Springboard currently estimates that SaaS CRM represents the largest segment of SaaS application expenditures in Asia at 45%, followed by collaboration, ERP/PLM/SCM applications, and human resource applications. Within the SaaS CRM segment in Asia, Salesforce.com has captured a very dominant position in the market. Other prominent vendors in the region include RightNow, Oracle, and Netsuite.

“Springboard Research believes that a substantial portion of the growth in Asia Pacific’s SaaS CRM market will come from the SME segment. We expect SMEs in Asia Pacific to go for simpler CRM solutions that are not too complex,” said Ms. Aggarwal. “This will drive CRM vendors, especially the traditional licensed software companies, to sell stripped-down versions of on-premise offerings or to develop SME-specific applications for distribution via the SaaS model.”

About This Study

Software-as-a-Service (SaaS) is a disruptive innovation that has the potential to transform the software industry. Many new players are entering the SaaS market, while established software companies are scrambling to compete against these new entrants by developing SaaS products themselves.

While SaaS has received a lot of press and hype, detailed information on the size, scale and characteristics of the market is still relatively limited. Springboard Research is helping to change this with its Asia Pacific SaaS Market Canvas, an ongoing research service through which users can access detailed and continuing research focused on SaaS in Asia.

About Springboard Research

Springboard Research’s core values are integrity and insight. Led by a team of dynamic industry experts, Springboard Research provides its customers with high value IT market research that helps them identify new market opportunities, growth engines and innovative ways to go to market. As a result, Springboard’s clients lead rather than follow market trends. Not bound by legacy, Springboard’s cutting-edge research model leverages its offshore research centers, the Internet, and an increased use of technology as engines of innovation to deliver unique research value. Provided as an alternative to traditional IT market research, Springboard’s reports deliver data and knowledge in a more usable and interactive format for our clients. Springboard Research works with the largest IT companies in the world in the software, services, hardware, and telecommunications sectors.

Founded in 2004, Springboard Research serves the needs of its clients globally through offices in the United States, Australia, Singapore and Japan as well as global research centers in India, Pakistan, and Morocco. Springboard has been acknowledged as an emerging leader in the global IT market research industry and was recently named a “Rising Star” by Outsell, the leading research and advisory firm for the information industry.

For more information regarding Springboard Research, please visit

Media Contacts

Chris Perrine, COO & EVP of Sales & Marketing
Springboard Research

Balaka Baruah Aggarwal, Senior Manager- Emerging Software
Springboard Research