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A fine pair for SMBs: CRM and e-commerce

The connection between e-commerce and CRM is getting a lot smoother for small and medium-sized businesses, thanks to a release this week from NetSuite and the entrance of a very large competitor.

A little more than a year ago, when Oriel Wines opened for business, the people there knew they would need an integrated, one-stop shop for back-office, front-office and e-commerce applications.

"We spent a fair amount of time in preparation setting up inventory management, financial planning, accounting and our Web store," said Kelly Ford, managing director for the New York-based company.

Oriel takes small batches of homemade wines from winemakers around the globe and sells them under the Oriel banner. It selected a hosted application from San Mateo, Calif.-based NetSuite to get its back office up and running, knowing that they could expand into CRM and e-commerce in the future.

Today, just in time for the holiday rush, NetSuite is releasing an upgrade to its e-commerce edition. The new release features built-in search engine optimization tools to improve search engine listings, as well as providing reports on which referrers, keywords and natural search terms lead to conversion ratio and customer revenue. Additionally, the new release allows customers to export their products into comparison shopping engines like Froogle, eBay's and Shopzilla. Through integration with PayPal, customers can now go global, thanks to PayPal's multiple currency support. E-mail marketing and abandoned cart tools analysis help retailers better market their products and FedEx integration, similar to NetSuite's existing UPS integration, which lets a retailer's customer track the progress of their order through the shipping giants.

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E-commerce has been a fast-growing business for NetSuite, which currently has 1,800 e-commerce customers, up from 1,000 last year. After the early, heady days of the Internet, e-commerce is again showing some serious growth, particularly in the small and midsized business (SMB) market and the connection between e-commerce and CRM is getting tighter.

"It's pretty easy to integrate e-commerce with CRM but we're seeing a lot more in that market," said Liz Herbert, analyst with Cambridge, Mass.-based Forrester Research Inc.

Just this week, Google entered the e-commerce fray offering  free Web analytics based on technology it acquired from Urchin Software Corp. last March.

"We're treating online retail like its own vertical in some ways," said Mini Peris, senior director of product management for NetSuite. "We've always thought that e-commerce should be part of CRM. It's a channel."

Oriel, just one year into operation is in the midst of trying to fill out that channel. While a majority of its wine sales still come through liquor stores and restaurants, the company is building out a loyalty program it calls Orbit -- complete with discounts for large orders, wine cellar management tips and a concierge service for members wishing to visit any of Oriel's wineries.

NetSuite's new search capabilities and e-mail tools should serve Oriel well as it builds up customer loyalty and e-mail marketing campaigns. Already, Oriel is seeing traffic and sales picking up. Its last e-mail newsletter got a 50% response rate.

"[Loyalty] clubs for us are the future of e-commerce," Ford said. "The Web store was put up as a marketing tool. We wanted to be careful not to compete with trade customers. As we're wrapping up trade efforts, we are doing this direct selling, but with a focus on these clubs. We can offer something the retailers can't in the way of experience, so it becomes more about the experience and not just the wine."

Oriel has had to do some custom work on the NetSuite sites, but Ford said the company has the expertise on staff and assistance from a NetSuite consultant and has probably saved two employee positions by running the hosted application.

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