To be honest my relationship with Sage has not been a particularly close one over the years. This I think is partly because the company caters primarily for small businesses and the mid-market, and most of my work is with larger companies. Furthermore, I have never associated Sage with emerging technology trends, and the company usually comes across as cautious, careful and not particularly "bleeding edge". Indeed, it shares many traits with the stereotype of its core end-user base of accountants.
However, I was recently invited to attend a dinner to discuss the launch of Sage CRM which is a "browser-based" CRM solution targeted at small companies with up to 250 employees. Two thoughts immediately sprang to mind:
- Sage like many another successful application business with a large installed base has taken quite a while to offer “Cloud” services; and
- CRM is a functional area with some very well-known and successful SaaS solutions already dominating the market.
So, in many ways this launch may mark the start of a very large marketing challenge for Sage.
Sage CRM is based out of Dublin, and the General Manager of the business is Lorcan Malone (who is, ironically for the manager of an offering targeting micro businesses, ex EDS!). Malone told me that there is a much stronger focus internally at Sage on delivering Cloud services under Guy Berruyer, who became CEO for Sage last October. Sage CRM is an interesting "browser-based" solution because, although it is a new offering, it is not a pure Cloud service.
Sage has chosen to develop the Sage CRM architecture with Rackspace using its RackConnect™ architecture. This means that the service can take advantage of virtualised compute power, but that databases can remain on a dedicated server behind a dedicated firewall. Such details will provide reassurance to the existing Sage installed base who may be considering the need to move beyond spread-sheets to manage, say, customer contact details. It will also make the development more palatable to Sage's channel partners. After all, one of the challenges of pure Cloud is the potential disintermediation of channel partners.
The other marketing challenge is Salesforce.com. Malone hopes that in English speaking regions where salesforce.com is a keen competitor, the Sage installed base will be his, not so secret, weapon. For small businesses that use Sage accountancy software to manage all sorts of business functions, the logical leap to use Sage CRM is obvious. As you move to slightly larger organisations, say above 100 employees, where there is a more strongly demarcated sales and marketing capability, I think the appeal of other CRM Cloud solutions will probably be stronger (including Sage Saleslogix Cloud).
However, in the UK public sector Sage CRM is off to a flying start as it was already listed in the Government CloudStore before it was formally launched in the market, while salesforce.com is not yet on CloudStore. And Sage CRM is hosted in the UK by Rackspace, for those with concerns about data centre location.
So, will Sage CRM set the SaaS world on fire? No. Will Sage CRM be attractive to small businesses already using Sage? Yes.
Dr Katy Ring is director of K2 Advisory.
Neil Davey is the managing editor of MyCustomer. An experienced business journalist and editor, Neil has worked on a variety of newspapers, magazines and websites over the past 20 years, including Internet Works, CXO magazine and Business Management. He joined MyCustomer in 2007.