Enterprise software company Siebel has announced a 161% rise in Q3 profits.
Siebel is one of the few technology firms not to have suffered in the stock market this year. The software company is dominant in customer relationship management (CRM) automation solutions. It is a market leader in its original area of sales force automation, in call center automation, and in front-end customer relationships, with a very broad customer base. It provides both software systems and technical services including support and consultancy.
The company’s strategy is to concentrate on vertical solutions, providing a one-stop-shop for CRM. It is also moving towards offering off-the-peg solutions to medium-sized companies that cannot afford heavily customized systems. This will have the extra advantage of increasing the revenue from training and support services, since smaller companies have fewer in-house technical resources.
It also intends to focus on Internet and mobile solutions, supporting Java, WAP and PalmOS. A strong part of its Internet strategy is to build dynamic pricing systems, based on the model of auction sites – it has recently acquired dCommerce (dynamic commerce) market leader OpenSite to help build such systems.
The only serious obstacle for the company in expanding to cover the mid-market is its current sales system. It is based on a large partnership network, supported by direct sales. This model is inappropriate for selling to small companies. Its move into leveraging its telesales operations to deal with smaller companies is seen as a positive step towards overcoming this.
Siebel’s results reflect its long-term prospects. Its existing larger clients will continue to provide a strong revenue source, and as it builds closer partnerships with fewer consultants, its mid-market strategy should drive significant growth. It is already in a strong position – all it needs to do for further success is to keep expanding its offering, stay up-to-date with eCommerce and mCommerce systems, and carry on attacking new geographies and industries.
