The traditional database-management, ERP, back-end enterprise software billionaire giant companies are taking on customer experience (CX) and the front-end.
SAP made a big statement for its front-end, customer experience vision with its announcement of SAP C/4HANA and SAP HANA Data Management Suite this month at its 22,000-attendee Sapphire Now customer conference at the Orange County Convention Center in Orlando, Fla. Following the completed acquisitions of Hybris (commerce), Gigya (customer identity management) and CallidusCloud (sales performance management and configure-price-quote), SAP officials said in a press release the company now ties together solutions to support all front-office functions, such as consumer data protection, marketing, commerce, sales and customer service.
Oracle’s been there, in the CX sandbox, for quite a while with acquisitions like Eloqua (2012) for B2B marketing automation and Responsys (2013) for B2C marketing scenarios. Oracle got a major nod from Forrester for its front-end marketing suite when Forrester named the company its only leader in its Digital Experience Platforms Wave in September. Gartner named IBM, Adobe, Sitecore and Liferay as the leading vendors in its first Digital Experience Magic Quadrant in January.
SAP Looking Ahead
Will SAP be able to make a big play and disrupt the front-end digital experiences vendor world on which marketers keep close tabs? Will they be able to compete with Adobe and Sitecore and open-source up-and-comers like Acquia who traditionally stand at the fore of digital experiences?
That was the big talk at Sapphire Now. We caught up with some SAP executives, analysts and industry watchers for some key takeaways from the massive show in the Sunshine State earlier this month.
Related Article: How to Choose Customer Relationship Management (CRM) Software
SAP Gunning for Salesforce, Not Oracle
“SAP was the last to accept the status quo of CRM and is now the first to change it,” SAP CEO Bill McDermott said in the release on C/4HANA. He said during his conference many times SAP will beat Salesforce in CRM. Gartner has reported that Salesforce has 20 percent of the marketshare in CRM while SAP is below 10 percent. “The legacy CRM systems are all about sales; SAP C/4HANA is all about the consumer,” McDermott said. “We recognize that every part of a business needs to be focused on a single view of the consumer. When you connect all SAP applications together in an intelligent cloud suite, the demand chain directly fuels the behaviors of the supply chain.”
Kevin Cochrane, chief marketing officer for SAP Hybris, echoed McDermott’s CRM sentiment in an interview with CMSWire at Sapphire Now. Salesforce is the major target here for SAP, not Oracle, though Forrester’s next Digital Experience Wave may pit Oracle vs. SAP head-to-head at the top if researchers continue to applaud the DXP providers that embrace native applications, portfolio depth and integrations.
“Much like Oracle we have a full stack, but our primary competitor, however, is Salesforce,” Cochrane told CMSWire. “Our primary goal is to reestablish and re-envision the CRM market and to put the relationship back in CRM. We don't see Oracle making a massive play right now to help customers with the end-to-end digital transformation to reinvent their business models, reinvent how they engage with customers and reinvent how they succeed in the new digital economy.”
Front-End Meets Back-End for Customer Experience
SAP’s big play this year at its conference was the front-end meeting the back-end for complete customer experiences. That’s what marketers strive for, right? Complete customer journeys from purchase intent to actual purchase and post-product success and support. The new SAP C/4HANA suite will offer full integration with SAP’s business applications portfolio, led by its ERP suite, SAP S/4HANA. The combination of assets features new machine learning capabilities from SAP Leonardo, a set of intelligent technologies the company introduced last year, as well as the new SAP HANA Data Management Suite, which enables companies to gain visibility and control of their highly distributed data, according to company officials.
SAP is pushing for a singular brand identity that ties the unification of the front office — the data, processes around a consent-driven consumer profile that transform CRM — to the entire SAP backplane through back-office automation, transforming supply chains, manufacturing floors, finance, payroll and more, Cochrane said. That connectedness in the front office with the back office, Cochrane added, is SAP’s strongest differentiator.
SAP Still Welcoming Third-Party Integrations
Cochrane, asked if SAP has any missing pieces from its customer experience suite, said the company believes it has acquired all of the core components necessary for a customer experience platform with recent acquisitions. “Now, that being said, customer requirements are complex. And we believe that the openness and the ecosystem of our platform is critical for us to enable every single use case across every single industry and across every single geography,” Cochrane added. He cited partnerships with web content management providers for alternative experiences.
Cochrane promised SAP’s microservices architecture will enable developers to build and extend next generation digital experiences inside its marketing, sales, services and customer data clouds. In this world, the SAP Customer Data Cloud from Gigya is becoming the “foundational architectural piece of the entire SAP stack.” It’s where customer data will meet master data management, he said.
SAP’s Customer Data Trust Play Through Gigya
Another big takeaway? SAP is the latest company to make a play on consumer trust in light of recent Facebook woes and regulations like GDPR. Patrick Salyer, former CEO of Gigya who came to SAP through the acquisition, said what drove the acquisition is the belief that consumers want a great customer experience but not at any cost. “They really want trust, transparency and control over their data,” he said. “You still need to know your customer, you need to drive new customer experiences. But we're moving away from all the ways to do this, which may have been buying data from data broker sites and tracking users maybe without their permission to more of a consent-driven data model. And that underlines the announcements (at Sapphire Now).”
How does the technology flow to support this belief? SAP through Gigya has the technology now to help manage registrations for websites like login authentication registration and allows users to self identify. SAP also has customer consent, which helps give permission according to terms of service and privacy policies. Users also have the power to manage communication preferences, opt ins, opt outs, etc.
And the SAP customer profile technology helps companies identify the customer, get the permission to access their data and use the SAP cloud-based data store to share this data plus the consent information into marketing, sales and service.
CRM Focus is Good, But SAP Changing Status Quo?
Scott Liewehr, CEO and founder of Digital Clarity Group, caught up with CMSWire at Sapphire Now. Speaking to McDermott’s comment that SAP will be the first to change the status quo of CRM, Liewehr noted that SAP was a legacy CRM that was disrupted by Salesforce. “So, to rival Salesforce’s explosion on the market, they launched SAP CRM On Demand,” Liewehr said. “So that comment by McDermott confuses me. Go ahead and say you want to change the role of CRM from being merely SFA (sales force automation) to a more broad definition, but don’t say you were ‘the last to accept the status quo of CRM.’ You set the status quo.”
Liewehr did say any focus on customer data is smart. CRM, he agrees, is supposed to have a broader definition than just sales force automation. In Digital Clarity Group’s recent DXP research, CRM was chosen by buy-side organizations as the number 1 center of gravity technology for the digital experience platforms they’re assembling. “Personally, I know that many organizations are looking to CRM systems for this, but I also know that CRM was likely viewed by our research respondents as a proxy for the system in which they’re attempting to unify all their customer data,” Liewehr added. “We know that many customers are looking toward Customer Data Platforms (CDPs) or they’re creating data lakes, etc., all in search of the ‘360-degree, single view of the customer’ holy grail. So, a focus on this is smart.”
Consent Not the Main Focus on DX Strategy
Despite talks of GDPR and SAP’s focus on Gigya and its consent play, Gigya’s play in the modern CRM space “doesn’t suffice,” Liewehr said. “I agree both that a solid customer data repository is critical to a successful customer experience strategy and that CRM needs to be modernized in order to play that role,” Liewehr said. However, he added, it has to be more than privacy, identity and consent management. “I know they’re talking up the GDPR and all that, and that’s a big deal, but identity and access management (IAM) is not the only consideration here,” he said. “If one wants to argue that IAM should be the new customer data platform of choice on which organizations should build their DX strategies, etc., then they can make that case. But one cannot say that IAM replaces CRM more broadly…the two just aren’t even close to equivalent.”
Will Usability Be a CX Issue for SAP?
Tony Byrne, CEO and founder of Real Story Group, told CMSWire the “CX" moniker is getting overused by vendors, and enterprise buyers need to get really clear about what this really means for them. “Most users of SAP technology,” Byrne said, “would never trust this vendor with customer-facing systems, where usability becomes paramount. “Like Salesforce, Adobe and Oracle, SAP is trying to unify customer data at a lower level in the stack, but what they all really mean is that they are building data warehouse products — licensable for an additional fee — that live beneath their suites and tooling, and not general-purpose customer data platforms.”
SAP Acquisitions Strengthen its CX Play
Sheryl Kingstone, vice president of customer experience and commerce at 451 Research, said SAP is clearly and finally stepping up its game for raising the awareness and priority of the customer experience applications. “The company has made solid strategic acquisitions that has helped it redefine its market position,” she said. “The market is ripe for replacement of legacy implementations since they can be complex to use because of their reliance on preconfigured rules that are difficult and costly to maintain." She cited acquisitions of Gigya, Callidus Cloud and Coresystems FSM AG as strengthening the portfolio across the customer journey.
Implementation, Integration Will Be a Challenge
Liewehr of Digital Clarity Group cautioned that bringing the front and back end stories together for digital customer experiences will be big jobs. “I don’t know which partners, besides the gigantic Deloittes and Accentures, of the world, can do this,” he said. “None of the digital agencies can bring this story together, they just work on the front-office side. Liewehr added the C4/HANA appeal will be the data-centric abilities, but the ecosystem of Hybris partners really don’t understand that world, he added. “We’re not just talking about marketing profiles here,” Liewehr said. “This, to me, will be a challenge.”