Butting Life Cycles

There is a tension resulting from the dynamics of today's CRM marketplace, where one CRM life cycle (client/server technology) is butting heads with a newer CRM life cycle (Web-based, e-customer). The life cycle based on client/server technology largely supports employee-facing CRM systems (aimed at helping internal sales, marketing, and customer service personnel), whereas the newer Web-based, e-customer life cycle supports more customer-facing CRM systems (where customers use Web browsers to access companyspecific information and services). Moreover, the increasing availability of new Web-based tools has helped to accelerate the impressive growth of the Web-based, e-customer life cycle.

What, you may ask, is likely to happen with these two butting life cycles, and what will this mean for the future of the CRM industry? These two butting life cycles are likely to co-exist over the next five years. Here's why.

The Client/Server Life Cycle

The client/server life cycle has a large installed client base that has seen the benefits of CRM firsthand. In other words, the clients trust their CRM client/server vendor. Moreover, most, if not all, CRM client/server vendors are in the process of adopting a more Web-based, e-customer centric approach. While their CRM automation software may not be Web-based from the ground up, they are taking necessary steps to become Web-compatible and they are promoting this to their large client/server installed base. Some of these vendors (e.g., Onyx) have rewritten their software to become entirely Web-based.

The result: The large client/server installed base trusts their CRM client/server vendor and continues to work with them as these vendors continue to support their client/server architecture while moving towards a new Web-based, e-customer centric approach. This trust, along with a very significant sum of promotional money by the CRM client/server vendors, keeps the client/server life cycle alive and kicking despite this technology becoming increasingly dated.

The Web-Based, E-Customer Life Cycle

On the other hand, the new Web-based, e-customer CRM vendors are in the process of building their own customer base. Needless to say, Web-based, e-customer CRM software is several years younger than client/server CRM software and thus Web-based, e-customer CRM software vendors have had less time to build their client base. In this regard, the Web-based, e-customer life cycle is at this time in the introduction/growth phase, whereas the client/server life cycle is at this time in the growth/maturity phase. Despite having a smaller installed client base, the Web-based, e-customer CRM automation vendors are offering very impressive CRM software. In fact, one could argue that their entire Web-based software offers functionality (e.g., customer self-service, click-stream analysis, content management, etc.) that many of today's customers desire.

The result: Their business continues to grow rapidly. Moreover, given the very large market capitalization of the existing and emerging Web-based, e-customer CRM automation vendors (e.g., BroadVision, KANA, E.piphany, Vignette, etc.), there is plenty of money to promote this new and exciting class of CRM automation software.

Learning to Live with Butting Life Cycles

In summary, there are two life cycles that exist within today's CRM automation industry. The client/server life cycle is made up of hundreds of solid CRM automation vendors that are moving into the Web world. The Web-based, e-customer life cycle is made up of dozens of respectable CRM automation vendors that are growing their customer base. ISM feels strongly that both life cycles will co-exist over the next five or so years, and that slowly the client/server life cycle will give way to the Web-based, e-customer life cycle.

If you are a CRM automation software buyer, expect to be pulled in two directions during this butting period, which could well last another few years. To maintain control of this situation over the next few years, be sure to ask the client/server CRM automation software vendors to explain their short-, medium-, and long-term development strategy vis-à-vis Web-based, e-customer business functionality. When dealing with Web-based, e-customer CRM software vendors, be sure to ask how these vendors currently integrate with existing client-server applications and how they expect to manage integration in the future. I humbly submit that over the long-term, the CRM industry will indeed move to a Web-based world.