By Erika Morphy
CRMDaily.com
February 28, 2002

'This slow economy is a time of lower risk for mid-sized companies looking to make major system upgrades that larger companies have already completed,' said Doug Lynn, a vice president of Meta Group's executive directions service.

CRM vendor Oncontact has brought the telephony functions of TeleVantage, a software-based phone system from Artisoft, into its client management software.

"We have integrated with Lucent, Nortel and now Artisoft," Tim Vertz, business development director for Oncontact, told CRMDaily.com.

Oncontact now provides customers with advanced phone features -- such as voice mail, auto attendant, intelligent call management, comprehensive messaging and graphical desktop call control -- that can be built right into their CRM application, the company said.

The significance of the Artisoft integration, Vertz added, is that "they are more focused at the mid-level market. They provide a good, affordable computer-based telephony system for that level."

The move reflects an emerging pattern of expansion in the small and mid-size CRM marketplace that could significantly change its landscape. "Penetration of CRM in the small to mid-size market is still in its infancy," Gartner research director Joe Outlaw told CRMDaily.

Outlaw estimates that about 20 percent of the mid-market has deployed a CRM application, while the small-size market has adoption rates of 1 percent to 2 percent.

But anecdotal evidence suggests that competition in this space is heating up.

Expanding the Mid-Market

On Tuesday, Microsoft (Nasdaq: MSFT) announced it would soon be rolling out its first major CRM application specifically designed for the small and mid-size market.

Meanwhile, traditional mid-market CRM vendors, such as J.D.Edwards (Nasdaq: JDEC), also are making inroads into the sector.

This summer, J.D. Edwards plans to unveil a CRM-ERP-APS (enterprise resource planning) product by integrating its current CRM 1.1 application, which is an ERP-CRM system, with order promising and demand consensus modules, a company spokesperson told CRMDaily.

Another mover in the field is IBM's (NYSE: IBM) WebSphere division, which plans to introduce a new product this quarter targeting the mid-size market, Ed Harbour, director of WebSphere foundations extensions, told CRMDaily.

Dollar Days

And, according to recent research, the market is going to see some spending.

A report released earlier this year by Meta Group (Nasdaq: METG) said that mid-size companies -- those with 500 to 5,000 employees -- are increasing IT spending.

"This slow economy is a time of lower risk for mid-sized companies looking to make major system upgrades that larger companies have already completed," said Doug Lynn, a vice president of Meta Group's executive directions service.

Close Contact

Some analysts place Oncontact in the small-size category, however, the company disagrees with that assessment.

"We are focused on the mid-market," Vertz said. "The companies we sell to are companies that are looking for a full-scale CRM system."

One example is Prudential Select Brokerage, which announced earlier this month that it has standardized its CRM platform with Oncontact's client management software for front-office needs, including tracking account and marketing management information for its brokers and general agencies.

Oncontact had the technology and features that the brokerage need, according to Donna Vecchiarelli, system director of Prudential Financial.