Original URL: http://www.theregister.co.uk/2004/11/17/microsoft_crm/

MS CRM wins hearts, minds, wallets

Business is key, not technology

By John Oates

Posted in Applications, 17th November 2004 16:24 GMT

David Batt, general manager of Microsoft CRM, said the CRM market is growing at between 10 and 15 per cent but Microsoft's CRM offering has grown more than 80 per cent a year in its first three years. Microsoft has found 3,500 customers and claims 62 per cent would be happy to be reference customers for the vendor.

According to Batt, the firm's success is down to its focus on the small and medium-sized business and its indirect sales force. Microsoft has 500 independent software vendors selling CRM.

"We looked at the CRM market and saw the likes of Salesforce, SAP, Siebel and PeopleSoft," he said. "But they are largely focused on the upper to mid-market. We are focused on smaller and medium-sized companies."

Many customers had never made a CRM decision because the technology scared them; others had tried and failed to install CRM systems. Batt said firms do CRM every day, they just don't call it by that name.

He claims three main drivers for Microsoft's CRM growth:

First, a quick business benefit: "We can get up and running quickly and show them the business benefits," he says.

Second, for mid-sized companies which are already Microsoft houses the ease of bolting on CRM to existing MS systems.

Third, firms which are choosing a CRM product and want one which runs on a Microsoft platform to make integration easier.

Batt believes the industry will continue to consolidate at the higher end and warns that customers concerns can get lost in such a noisy marketplace. Asked about competing firms he said: "We see Sage typically with customers who are rethinking a failed CRM project. Many of our customers are people who've never made a CRM decision - we can integrate with Outlook or Word, that's something Sage can't do. Sage and Microsoft do compete over customers - but it's not been an impediment to our growth."

According to Batt, salesforce.com tends to focus more on higher end customers rather than the small and medium firms targeted by Microsoft. Asked if open source was a threat, he said: "Business is key, not technology. These customers aren't interested in how good our technology, or anyone else's, is, they care about business." ®

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