Siebel OnDemand CRM Goes Vertical

The hosted offering still targets smaller companies--those with up to $500 million in revenue, excluding subsidiaries, said Bruce Cleveland, senior vice president and general manager of Siebel's OnDemand Release 6 and SMB Division.

The on-premises version of Siebel's CRM targets 23 verticals, so Siebel took a look across the market for both small and midsize companies and enterprises and the biggest opportunities were in these fields, Cleveland told CRN. The company hopes its OnDemand Release 6 offering, hosted by

IBM Global Services hosts the service for SMBs, a segment where Siebel has seen limited success. Cleveland also said he is working to remedy Siebel's often rocky relationships with VARs and integrators to better penetrate this market.

"We spent the majority of 2004 building a competitive product. In the third quarter we were close enough to hire a sales organization for SMB. We've never had that. But a feature of that market is more than 50 percent of the customers want to buy through partners," he said.

Siebel's own sales force, unlike their competitors at Oracle, face no penalty if a sale goes through a partner vs. direct, Cleveland said. "They are paid identically and I am ratcheting up the amount [of sales] that must go through the channel. You can't start at 100 percent if your partners are not in place."

Cleveland acknowledged that Siebel, which at one time attacked the midmarket via a partnership with Great Plains Software that ended three years ago, has to build and fortify channel relationships. The company is known for an extremely aggressive and competitive sales force, and also was hurt by the perception that its enterprise software was not only costly to purchase, but also very expensive to implement and install.

The new OnDemand Release 6 solution costs $70 per user per year for the base product or $100 per user per year for a vertical version.

Siebel, San Mateo, Calif., defines the midmarket as companies with up to $500 million in revenue, not including subsidiaries. Cleveland said OnDemand Release 6 competes most directly with Salesforce.com, a hosted offering that often requires considerable customization by end users, he said.