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CRM trend: Hosted goes vertical

Salesnet is first out of the gate with industry-specific editions of its hosted software, but others are getting in the game too.

Hosted CRM will enter a new phase Monday when Boston-based Salesnet Inc. becomes the first to release vertical versions of its application.

Salesnet will offer telecom services, commercial lending and advertising/media sales editions.

Competitor San Mateo, Calif.-based Siebel Systems Inc. announced last month that it will add four vertical iterations of its OnDemand application this summer. Siebel plans to tackle the insurance, high technology, automobile and communications and media industries.

Vertical editions of hosted software were inevitable, according to Sheryl Kingstone, CRM program manager with the Boston-based Yankee Group.

"It's always the next step," Kingstone said. "What Siebel's done is leverage its domain expertise of its on-premise verticals. Salesnet needed to leverage its partners, which it's done."

An original equipment manufacturing partnership with Encoda Systems Inc., a Denver-based software maker that serves the cable and broadcasting industry, helped Salesnet to develop its advertising/media sales edition, said Dan Starr, chief marketing officer.

In fact, that was one of the reasons Salesnet elected to begin its vertical push with these three industries. Salesnet selected the industries based on its own understanding of the industry and existing customer success, as well as whether the industry has embraced the hosted model and whether the company has partners to assist with distribution.

The new vertical services include features such as prebuilt reports and terminology designed for the industries. Sales processes and workflow are the most important features though, Starr said.

"We think that is a differentiation for us," Starr said. "Dashboards, reports and screen layouts don't really help you sell more effectively. These editions help sell with proven processes that we know are effective in these industries."

Salesnet intends to roll out three additional verticals in the next quarter and will also create editions based on sales methodologies. In February, the company announced a partnership with Integrity Systems Inc., a sales training organization in Phoenix, to market customized versions of Salesnet's application based on the Integrity method.

"Many midmarket companies are looking for best practices," Kingstone said. "That's where Salesnet can take the lead. If they can leverage a best practice, that's going to be a differentiator for them."

The vertical editions will be available as add-on modules to the extended edition and cost an additional $5 per user per month.

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