December 14, 1998

Most Important Products Of 98

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Most Important Products Of 98:

Enterprise Application Integration Software Teamware Enterprise JavaBeans SQL Server 7.0 Network-Attached Storage Application Servers NetWare 5 Customer-Management Applications Midmarket ERP Transaction Management Runners-Up

Customer-Management Applications
Front-office IT efforts focused in the past on sales-force automation and customer service, which often existed as discrete systems. But a new breed of front-office applications has emerged this year that ties together all of a company's outward-facing actions: sales, service, and marketing.

The best example of the trend is customer-relationship management (sometimes called enterprise relationship management). The still-young product category has a shifting profile depending on who describes it, but at its simplest it combines a company's marketing, sales, and service efforts in some way that informs salespeople about marketing campaigns and service initiatives. Or it does the same thing for service staff and marketing departments.

Part of the reason for the move to customer-relationship management and application subsets such as marketing automation is the fact that the processes they cover aren't automated. Marketing departments in particular have lagged behind sales, financial, manufacturing, and human resources groups in receiving applications that will streamline their efforts. So the marketing tends to be chaotic, subscribing to no particular process.

Marketing campaigns may be unfocused, for example, and leads generated by those campaigns may never reach their destinations in sales departments. But the advantages of customer-management software go far beyond automating processes such as customer service, marketing, and sales. Rather than simply increasing efficiency and squeezing costs out of the system, the main focus of enterprise resource planning, relationship-management applications can help companies understand and serve customers and partners better.

"It's more about one-to-one marketing, one-to-one sales, one-to-one service," says Steve Bonadeo, an analyst with the Hurwitz Group. "It's about building relationships." Because customer-relationship management is so broad, there are no clear leaders. But a number of vendors have emerged as front-runners. Foremost is Siebel Systems Inc., the largest front-office vendor, at $400 million, and still growing rapidly. Siebel 99, the next generation of its application suite, aims at customer-relationship management and bolsters its marketing capabilities.

Other vendors to watch for are Epiphany, Onyx Software, and Oracle. Marketing automation has emerged as one of the liveliest applications markets as vendors old and new swarm to fill one of the most obvious remaining holes in the enterprise application infrastructure. A number of well-financed startups are noteworthy, including Annuncio, MarketFirst, MarketSoft, and Rubric. Older vendors include Magnifi and Prime Response.

--Jeff Sweat

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