Will Consolidation Trends Change Your CRM Buying Habits?

For the past five years, the sales technology business has been dominated by a handful of giant CRM vendors and a horde of smaller players staking out market niches. But now it seems the industry might be on the cusp of an interesting new trend toward consolidation. One case in point: salesforce.com’s April announcement that it plans to acquire the lead-generation firm Jigsaw. And just this month, Sant Corporation and Kadient announced a merger that establishes the combined company as the dominant provider of on-demand, sales-enablement solutions.

Some say these recent announcements reflect shifting preferences among decision makers with purchasing power. According to Sant CEO Lewis Miller, "customers are no longer willing to deal with a dozen or more vendors in order to build out their sales-technology system." He continues, "The need to simplify these systems will inevitably drive firms to consolidate."

In the case of Sant and Kadient, the two companies have entirely complementary product sets. Sant’s proposal-automation solutions improve win rates by accelerating the production of persuasive proposals, RFP responses, presentations, and related documents. Kadient is the only on-demand, sales-enablement platform that embeds its interactive, situation-specific Sales Playbooks in a CRM system. The results of these combined solutions are greater sales productivity and win rates and shorter sales cycles.

"It was our feeling that, since we’re selling to the same customer base, our two firms would be stronger and more efficient if we combined efforts," says Kadient CEO Brian Zanghi, who will join the board of directors of the combined company. (Lewis Miller will serve as president and CEO).

Indeed, the combined company will be looking to extend its reach as the market consolidates. Adds Zanghi, "Once you make the decision to extend your footprint, it opens up gaps in what you provide, and so we’ll be looking for more opportunities to extend value to our existing base of 1,200 customers."

Kadient and Sant will operate under their existing names until a rebranding project is complete later this year. The combined company will be a presence at the upcoming Sales 2.0 Conference in Boston on June 28, 2010.