Who is Leading in Social CRM?

Thursday Feb 10th 2011 by Drew Robb
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Social CRM will be a $1 billion market this year, but who will lead it?

There is so much buzz about social CRM these days. Companies like Intuit, Procter & Gamble and Citigroup have embraced it in a big way. Gartner is now devoting magic quadrants to it and a slew of companies have raced into this emerging field.

According to Gartner, social CRM will be a $1 billion subsector of the CRM market by the end of this year. The various sites, blogs and communities that comprise this arena represent the fastest growing areas of the Internet. Further, it now reaches more people than email, according to Nielsen Online.

Already, hundreds of vendors populate this space. Some offer little more than a widget while others attempt to roll social CRM in with traditional customer relationship management (CRM) or call center tools. Some call it social media monitoring or add some data mining tools and call it social media analytics.

According to Gartner analyst Adam Sarner, those who are currently ahead of the pack are Jive Software and Lithium Technologies. Jive offers collaboration software, social media monitoring and community software under the umbrella of its Jive Engage Platform. It recently added four Jive Apps Market features to enable faster development of social media tools on this platform, ease of purchasing, simplified billing and enhanced revenue sharing capabilities.

"Jive Apps Market will change the economics of how developers market and sell the next generation of social business applications," said Robin Bordoli, vice president of product management for Jive Apps.

Lithium offers a similar suite with an emphasis on finding and engaging your most supportive customers. It ties together Facebook, Twitter, the social Web and branded communities.

 

Salesforce, Oracle pressured by startups

Who else is in the hunt? Gartner listed start ups like Mzinga and KickApps, as well as more established players like Salesforce.com, RightNow Technologies and Oracle CRM on Demand. But that was a few months back. Just about everyone is getting into the race these days.

SugarCRM has added social features, but allows users to decide how they leverage social data and channels inside the Sugar system. For example, SugarCRM users can now monitor Twitter streams of contacts or accounts, as well as uncover leads and relationship data from networks like LinkedIn and place it into the CRM record.

"The idea is not to limit users with prescribed notions of social CRM interaction management, but to provide simple tools for leveraging social channels and data to foster better interactions with customers," said Martin Schneider, senior director of marketing at SugarCRM. "In social CRM, Oracle and Salesforce.com have potentially the deepest pockets, so it is no surprise that they have been talking up social features for some time."

However, he thinks that rigidity is present in their systems, as they are based either on older software code or they are lacking open multi-tenant features. That's why he agrees with Gartner that Lithium and Jive are far ahead of both of these providers when it comes to inbound or outbound collaboration and community building. Schneider also likes RightNow's approach, which focuses on customer experience rather than core collaboration or social media marketing tools.

"We have not seen much social CRM talk out of Microsoft either," said Schneider. "Microsoft Dynamics CRM is still finding its legs in terms of traditional CRM, cloud-based deployment and a channel-led go-to-market strategy, so social might just be on the back-burner at this time."

 

Richard Hughes, director of product strategy at BroadVision, thinks that this field is so new that no one is leading in social CRM so far. His logic is straightforward. Social CRM vendors have mostly come from one of two directions — traditional CRM vendors who are adding Social CRM capabilities, and social software startups who center upon customer engagement.

Hughes doesn't think this is the whole picture, however. "I don't feel that either category has all the pieces in place yet," he said. "Traditional CRM vendors lack the customer community capability; social startups lack the enterprise-level integration capabilities to link the customer community back to enterprise systems."

Who is going to win? Hughes is betting on the social specialists, as they are not trying to squeeze a new engagement model into a system that was not designed for it. But they will need to integrate to CRM systems already in place.

"All the big CRM vendors are lagging behind. The social startups are closest to achieving true social CRM," said Hughes.

Until the market matures, he thinks that plenty of confusion will bounce around the marketplace — lots of hype and an abundance of clashing and confusing visions and definitions.

"Customers need to be very clear on what they're looking for from vendors," said Hughes.

 

SAP gets social

Meanwhile, the major CRM players are not sitting quietly waiting to be gobbled up by this new raft of startups. In fact, the opposite is likely to happen. Gartner expects plenty of market consolidation. The strongest of the emerging crop will merge and the likes of Oracle, SAP and others will acquire to give more social breadth to their portfolios. And the big boys are turning to a wealth of internal developmental resources as they play catch up.

SAP, for instance, has already released several social CRM consulting packages for its customers. These are the Twitter Customer Service, Twitter Marketing and Facebook Loyalty Management.

"Our software brings unstructured data from social networks into the CRM system," said Renee Wilhelm, SAP's CRM Solution Manager.

 

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