It’s safe to say that mobile customer relationship management (CRM) is in a state of flux. After years of steady growth—and industry dominance by larger firms such as Sybase and Siebel—2004 has heralded both a mini-hiccup in sales and the emergence of some new players. New companies such as Salesnet.com and smaller veterans such as FrontRange are using powerful tactics to creep up on the major players.
Those tactics? As simple as it may seem, they are customization and targeted marketing aimed at new vertical industries.
“We’re finding that our customers are really looking for customized solutions,” says Greg Anderson, VP of sales for FrontRange. “They want to have applications that work the way their users actually work. They’re highly mobile, and they want real-time information.”
Haven’t customers always wanted that? Anderson says yes, of course they have, but until recently, design and marketing efforts for most CRM providers hadn’t been meeting the demand. Anderson says that wireless CRM providers may have been too focused on innovation, particularly in the once-booming sales force market. “Sales forces don’t need to do everything. They want [the technology] to do the few things they need for it to do, whether it’s looking up a contact, checking on an order or scheduling a meeting.”
Sluggish sales through the first part of 2004 haven’t deterred major players such as iAnywhere, FrontRange, Salesforce.com or Salesnet, all of whom have either introduced new wireless CRM products this year or plan to do so in early 2005. All are betting that small to medium-sized businesses (SMB) are going to get involved in wireless CRM in a big way.
“We’ve seen an interesting movement in wireless CRM firms, which have really shifted to focus on the specific needs of the different vertical industries,” says Anderson. “Siebel has done an excellent job in this area. Now PeopleSoft and SAP are doing similar work to put their offerings in a real vertical package to gain appeal within those industries.”
One of the reasons wireless CRM providers are so convinced of this impending growth is they are aggressively pursuing feedback from customers and prospects. “There are very disparate pieces of functionality within CRM, and people’s goals can be very different,” says Lubos Parobek, iAnywhere senior product manger. “There are many customers who, when they implement CRM, their primary goal is to automate their call center, and they’re not interested in rolling out any advanced sales tools. Then there are customers who roll out CRM primarily for sales force automation functionality.”
According to Anderson, FrontRange has significantly stepped up efforts to stay in touch with end users. “We have talked to thousands of customers and prospects, trying to validate our thinking. We do road shows where we’ll see 1,000 customers in 12 different cities. We’ll spend three or four hours talking about our strategy, but more importantly, getting their feedback and listening to what they need.”
Feedback Paints a Picture
What wireless providers are hearing isn’t surprising. “The key to the SMB market is that the companies can’t come up with an exorbitant amount of money. They can’t replace every cell phone they have today with a Treo or a BlackBerry. They have to work within budgetary constraints,” says Parobek.
Fierce competition in the wireless CRM market hasn’t had the typical impact of driving down costs. Rather, it has sped innovation. Says Parobek, “I don’t think costs [for the devices and the supporting software] are coming down that much. Because we’re still early, there’s still a lot of innovation and expense going in, so prices have remained steady. The area where I’ve seen prices go down quite a bit is implementation costs and the time of implementation. I’ve seen typical developments shrink from four to six months down to one or two months and training shrink from a week or more to a single day.”
Costs aside, potential purchasers of wireless CRM solutions will tell you there are three main reasons they either haven’t yet purchased a solution or they’ve tried one and dropped it. (CRM magazine reported recently that a shocking 60 percent of wireless deployments are dropped in the first year.) The ironic part about those three key roadblocks—complexity of implementation, difficulty demonstrating ROI and security of information—is that they remain unchanged from the concerns end users had five years ago.
iAnywhere’s Parobek says that the single biggest inhibitor to selling mobile into the SMB market is complexity. “The key for them is making the solution simple to implement and secure. We have to make it very simple, so end users don’t have to install a server or worry about security. They don’t have the technical resources to get their arms around implementing the solutions themselves. They need a hosted solution. Or, if it’s not hosted, it needs to be really simple in terms of installation and packaging. Removing that complexity is key.”
According to FrontRange’s Anderson, CRM vendors are working most aggressively on solving the complexity issue. “We really feel like complexity is holding people back. As the technology has matured, all the vendors have gotten better at providing robust tools for managing the synchronization and application servers and trouble-shooting them. We’re teaming with the back-end CRM vendors, and the primary driver there for us is to achieve simplicity. By embedding our solution into vendor offerings such as Salesforce.com, we see it as a great way to take away that complexity.”
Expectations for ROI are very high across most verticals. In their 2004 update on the state of the CRM industry, CRM magazine reported that many wireless CRM adopters drop their new technology if they don’t see ROI in one year. If that seems a bit hasty, Parobek disagrees. “I don’t think a year is too much time at all [to expect ROI]. One of the things that we’ve been asked to do by customers is to make it easier for them to measure where they’re getting benefit.”
One way to measure that is by reporting systems that can at least tell a company how many of their employees are using the solution. “That lets people know quickly what kind of impact the devices are having,” says Parobek. “At minimum, you can find out how people are using the devices.”
FrontRange tries to tackle the ROI questions by first helping its customers establish specific goals that are easier to measure than customer satisfaction. “[Customers] need to start with specific areas—what are your biggest pain points?” says Anderson. “Focus in on certain areas, and then find your measurement.” From there, FrontRange helps the customer figure out what data needs to be captured. “We try to encourage customers to focus on smaller projects so that they can easily show what your ROI is on that part of the project.”
Beyond the common concerns about cost, implementation and quantifiable ROI, end-users can now add a fourth concern: security. In this era of ever-shrinking mobile solutions, it’s not only possible to leave secure data behind, some would say it’s likely. “I saw a statistic recently that 60 percent of PDAs actually get lost or left somewhere,” says Anderson. “That’s a big cause for concern.”
What Master Are You Serving?
Selling and implementing wireless CRM solutions presents a significant challenge: While vendors such as Salesforce.com sell their solutions to management, labor will be the ultimate arbiter of whether or not the solution works.
“I think a lot of CRM implementations have failed because there are two big constituencies you have to be able to serve,” says Anderson. “You’ve got management, which needs the oversight capabilities, and then you’ve got the end user. A lot of times, the end user sees the solutions as an obligation.” They may not see the value in the solution, or worse, think that management has implemented it simply as a big brother–style, tracking device. “They might say, ‘There is no value for me, it’s just so management can look over my shoulder.’”
When software vendor Parametric Technology implemented a wireless CRM solution from Siebel three years ago in its call center, sales force and marketing department, everything went smoothly, according to Steve Horan, senior VP and CIO. The issue, he says, was adoption. Despite following the handbook on how to implement a wireless solution, down to establishing an implementation task force and a steering committee, enlisting support from all the top brass, and keeping implementation as simple as possible, about 20 percent of his workforce resisted the move.
Three years later, the company is still trying to figure out whether the venture has been a success. “Would I do it again?” Horan says. “I don’t know. It has been implemented well, and we’ve seen some return on investment. I’d call it a marginal success.”
FrontRange’s Anderson says that companies providing solutions must strike the delicate balance of selling while making sure that the end user is getting the right solution—not just what management wants to see implemented. “We’re focused on the value to the end user,” he says. “We want to provide value to their day-to-day, so that they can see how they’re more effective and how they can make more money and put more money in their pocket. Then they’re much more likely to adapt to the technology.”
Customization may be the answer to many of these challenges. “We think the key is really having a broad spectrum of products and taking each one of those and drilling down, understanding the user group we’re actually servicing,” says iAnywhere’s Parobek.
When it’s all said and done, everyone involved has to keep in mind what the ultimate purpose of the solution is. “CRM is about much more than implementing a wireless solution or building sales,” says Parobek. “You really have to have the mindset of putting the customer in the middle of it. Many companies are taking that message to heart, and that mindset is what will drive the next generation of the technology.”
Coming Down to the Wireless
“We’re moving out of the period where people were primarily doing pilot deployments 50 or 100 deep and moving into a phase where many more enterprises are actually doing large, across-the-board implementations of handheld solutions for their front-line sales people,” says FrontRange’s Anderson. “People have done some pilots and are now looking at doing broader deployments. Vendors have done their trials and proven that there are measurable benefits. Now they’re looking at rolling solutions across the entire sales force. We’re on the cusp of very large deployments.”
Even the big boys are now targeting mid-market customers. SAP and Siebel, which have long paid lip service to smaller customers, are moving into the segment swiftly and decisively. And now, the 800-pound gorilla, known as Microsoft, has gotten into the wireless CRM game. As the players get bigger and the stakes get higher, one thing is certain: Competition at the highest level will be good to customers.•
Bill Schu is a freelance writer based in New Jersey.