As ASUG readers may have already seen in our SAPPHIRE NOW and ASUG Annual Conference preview, SAP is mounting a new drive to make customer relationship management (CRM) a key element of its still-expanding software stack. If you are questioning (or casually analyzing) this move, you may be wondering why the strategists back in Walldorf think they can take on the heavy hitters in the CRM space, Salesforce and Oracle, or even go up against the smaller players like Pegasystems, Dynamics 365, and Verint.

It Goes Back to the Cloud

The answer leads back to SAP’s recent acquisition of Callidus Software. Its CallidusCloud product is tailored to helping salespeople on the ground link and integrate sales-related information, such as pricing, incentives, and commissions, back to enterprise resource planning (ERP) systems. So, the logical CRM-to-ERP link is now there. But how SAP fuses these new capabilities with its other systems remains to be seen.

CRM 101: The Basics

Taking a step back for a moment, let’s remind ourselves what CRM is. For most of us on the consumer side, our first experience with CRM is something like our supermarket loyalty card starting to recognize which brand of soap, beer, or breakfast cereal we buy. The supermarket then sends us related coupons, either in the mail, along with our receipts, via email, or maybe even to our mobile phones. The idea is that we’ll start to feel warm and fuzzy because our relationship with the store is being reinforced, all while we’re incentivized to return and purchase more of what we like.

Stitching Together Customer Touchpoints

CRM in 2018 has the potential to go even further, incorporating customer data channels including everything from telephone contacts, emails, live chatbot chats, and content that customers engage with on a company’s website. We often think of consumer-based examples first, such as the supermarket loyalty program, but CRM is used heavily to drive business-to-business sales, especially now that B2B buyers conduct so much upfront research before ever picking up the phone to contact a salesperson. These digital leads are critical to today’s sales pipelines.

Omnichannel, Digital, and Personalized 

Back to SAP then. The company views contemporary best-in-class CRM software systems as ones that provide additional tools for customer analytics, personalization, e-commerce, social media, and collaboration. All with the ultimate goal of driving omnichannel customer engagement.

SAP’s existing stack of software features portions of CRM in many of its channels. Key among these is SAP Hybris, often referred to as a “marketing cloud,” with revenue and billing solution components for commerce, marketing, revenue, sales, and service. Let’s also remember that SAP added Gigya to this mix, a firm it purchased at the end of 2017 to integrate its core capability in customer identity and access management.

As noted when it was purchased, Gigya’s customer identity management platform helps companies build digital relationships with their customers. Its platform allows companies to manage customer profiles, preferences, opt-ins, and consent settings, with customers maintaining control of their data at all times. Now that the GDPR is in full effect for data from EU citizens and that there’s growing scrutiny of how companies are handling their customer data in general, this surely will come in handy for SAP users.

SAP Has Taken Seats at the CRM Table

SAP’s CRM vision is coming into focus right now. Callidus is the new baby, teenager Gigya is already at the dinner table, seated next to mother and father SAP Hybris, while grandfather (in deference to Dr. Hasso) SAP HANA is carving the turkey.

Just how far will SAP push its CRM ambitions? Computerworld UK editor Scott Carey notes SAP CEO Bill McDermott’s comments made during a Q1 2018 earnings telephone briefing. “Basically, we are going to rebrand the whole CRM category. It’s going to be a massive movement at SAPPHIRE NOW and we're going to show every customer that they can be a best-run business by running SAP and no longer do they have to be relegated to an outdated sales platform with complex integration layers trying to get that data out of the ERP system," said McDermott, as reported by Carey.

What the Next-Generation CRM Platform Might Look Like

Carey further notes McDermott’s thinly veiled swipe at Salesforce, the top cloud-based CRM platform provider. The SAP chief has called the market’s existing “so called cloud CRM” software nothing more than overpriced software running on first generation software as a service (SaaS) architecture. Whether this opens up a war of words with Salesforce CEO Marc Benioff remains to be seen. SAP certainly has the integration capabilities to bring these newer elements under the SAP S/4HANA umbrella with, presumably, SAP Leonardo as a key go-to-market mechanism to help engineer a deeper thread of CRM into SAP customers’ design thinking strategies. Current, clean, and complete customer data is the holy grail for marketing and sales, and SAP surely knows data inside and out.

Building Out SAP’s CRM Vision

As SAP begins to build out its own vision of CRM, we can agree that the Callidus acquisition makes a lot of sense. The CallidusCloud platform features the “Lead to Money” software suite. This area includes solutions for Sales Performance Management (SPM) and sales execution, including Configure-Price-Quote (CPQ) applications. There are also sales enablement tools such as learning applications, customer engagement tools, and analytics. So it really is becoming more than just CRM at SAP: It’s CRM from the sales end AND the customer end.

“CallidusCloud SPM solutions give salespeople instantaneous knowledge of their compensation associated with particular product and pricing configurations and reduce errors in calculating sales commissions and compensation arrangements. CallidusCloud CPQ solutions enable salespeople to identify and configure product packages that have built-in rules for discounts and that can generate proposals for the customers on the spot and during the conversation with the customer,” noted SAP in its acquisition statement.

A More-Connected Customer Experience

SAP’s core “what is CRM” description broadens CRM into a discipline that covers:

  • CRM for sales
  • CRM for marketing
  • CRM for commerce
  • CRM for service 

It’s this broader view that could help companies deliver a more-connected customer experience across the entire relationship, from the first online interaction through to the post-sale support and repeat purchases. Given the focus as it first appears, let’s hope that the SAP CRM dream keeps customers at the heart of its concerns while it continues to build its competitor-busting technology proposition. What happens next will be interesting to watch.

Interested in how SAP can help you enhance your customer experience? See the agenda for the Customer Experience Innovation Forum, our newest event for retailers, consumer products companies, and wholesalers looking for ways to delight their customers.