Gartner Inc. says SAP is gaining ground on Oracle and Salesforce.com with its new CRM 2007 release, but the latest rankings of sales force automation (SFA) software are notable for who's not on the list.
Oracle's E-Business Suite and PeopleSoft CRM applications were dropped from the Stamford, Conn.-based research firm's annual Magic Quadrant, as were SAP's CRM On Demand and RightNow Technologies.
Oracle purchased Siebel and PeopleSoft in recent years. Both PeopleSoft's software and Oracle's own CRM tool traditionally placed high in Gartner's rankings, but this time, analysts were unable to validate that each had 15 new named customers actively deploying the applications in the past 12 months, as required by Gartner's criteria for the Magic Quadrant.
"The bottom line is there are still offerings out there, but most of the action we see is with Siebel On Premise or Oracle On Demand," said Rob Desisto, vice president and distinguished analyst with Gartner and author of the report. "There's not enough independent validation that that stuff meets the bar. Those offerings can't keep pace with Siebel or Oracle On Demand -- or the rest of the market for that matter."
Gartner ranks software vendors in four categories. Leaders are vendors that excel in both ability to execute and completeness of vision; challengers have the ability to execute but lack strong vision; visionaries are market-thought leaders, but they struggle with functionality issues; and niche players concentrate on just one or two specific segments of the SFA market, but do it well.
Gartner listed San Francisco-based Salesforce.com and Oracle's Siebel CRM as the sole leaders in the quadrant. Microsoft Dynamics CRM, SAP and Sage's SalesLogix were the three challengers. Oracle's CRM On Demand and Landslide Technologies were positioned in the visionaries quadrant, and the rest -- SageCRM, NetSuite, ACT, Infor, Pivotal, SugarCRM, GoldMine, Maximizer Software and Consona -- were all listed as niche players.
SAP made the most progress since last year with its new CRM release.
"With CRM 2007, they've really improved their user interface," Desisto said. "What it's done is given people who have implemented SAP as a suite the opportunity to go back to their users and say, 'Hey look at the improvements here; this is not the typical SAP you've known.' "
SAP CRM On Demand was dropped from the rankings, however, also because it didn't meet study inclusion requirements. Gartner could not validate that it had 100 customers or at least 15 new named customers in the past 12 months. SAP has shifted its emphasis with on-demand or Software as a Service (SaaS), redirecting its efforts to Business ByDesign, a fully on-demand suite, although SAP revealed in May that it is scaling back development on that application as well.
Others are making progress, but Siebel, Salesforce.com and SAP remain the top choices, according to Gartner.
"Microsoft is clearly breathing down [Siebel's and Salesforce.com's] neck here," Desisto said. "NetSuite has done OK, but they're in the broader ERP suite play. SugarCRM innovated with open source, but here again, when I get called on short lists, the typical suspects always pop up."
Looking ahead, Desisto expects on-demand deployments to continue to predominate, with a majority of users ultimately accessing their applications over the Internet.
"If you look at SFA, it's going to be very hard to compete without an on-demand offering," he said. "Salesforce, Oracle, Microsoft, NetSuite, Pivotal, Sage, even SAP -- all these guys, they all have on-demand options. The writing's clearly on the wall."
Other vendors were dropped from the study for different reasons. RightNow Technologies, which traditionally focused on the customer service and call center side of CRM until it purchased Salesnet, was dropped because it did not focus its application on B2B selling organizations. Two others were also dropped: Entellium, because Gartner could not validate that it had a deployment of more than 100 users; and Saratoga, because it was acquired by CDC, owner of Pivotal.