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Software // Enterprise Applications

SAP Makes Play For Retek Customers

At the Retail Systems conference in Chicago Tuesday, SAP said it would offer incentives, such as discounts on software and services, to any Retek customer choosing to make the switch.

SAP may have lost its bid to acquire Retek Inc., but it's not through with its efforts to acquire the company's customers.

SAP has launched an aggressive effort to convince customers of Retek, successfully acquired by Oracle in April, to move to its software. At the Retail Systems conference in Chicago Tuesday, SAP said it would offer incentives, such as discounts on software and services, to any Retek customer choosing to make the switch.

SAP has agreed to give Retek customers a credit of up to 75% of their original Retek software licensing fees if they purchase and deploy the SAP for Retail product suite. SAP said it will help customers develop a business case for deployment, map out a module system, and train and educate customer employees on the platform.

SAP's Safe Passage plan, initially offered to PeopleSoft and J.D. Edwards customers when Oracle acquired PeopleSoft, has proved "very successful," says Jim McMurray, SAP's senior VP for retail. From January through March, SAP closed more than 10 deals in the Safe Passage program, he says.

SAP offers a wide selection of retail-specific products, yet it may not have everything Retek customers are looking for. "We don't play in point of sale, price optimization, or visual merchandising space," McMurray says. However, the company offers those products through partners such as Profit Logic, he adds. "We recognized early on that for some reason if we weren't successful acquiring Retek, there couldn't have been a better time to force the hand of a competitor."

That hand belongs to Oracle, which extended to payout a hefty $670 million for Retek on the heels of an 18-month hostile takeover bid of PeopleSoft. At the time SAP made its bid for Retek, Oracle CEO Larry Ellison admitted to getting temporarily sidetracked while in the throes of winding down the PeopleSoft acquisition.

Some recent big customer wins, including Home Depot and The Limited, can help SAP convince retailers it has what it takes to be their supplier, according to a report published this week by AMR Research. However, SAP still needs to prove it has moved beyond problematic implementations from the past at Jo-Ann Stores and Petsmart. "Recent retail success clearly puts SAP into a growing industry leadership position, but functionality challenges and development timelines could hinder the transition from contract signing to successful deployment," according to the report.

SAP says it's committed to adding functions to its retail products. Three ways are possible: developing features and products internally, continuing to partner with companies that make point-of-sale or optimization software, or getting them through acquisitions. Campbell Software, acquired in the late 1990s, marks the last time SAP acquired a company with retail-specific applications.

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