SAP to target PeopleSoft customers with campaign
- 12 June, 2003 08:05
Although most companies loath uncertainty, it can provide opportunity from time to time. That's the view of SAP AG, which sees a window of opportunity to poach customers amid uncertainty related to Oracle Corp.'s hostile bid for PeopleSoft Inc.
If Oracle succeeds in its bid to acquire PeopleSoft, analysts warn that users could face a rough transition -- a prospect that could prompt many of them to switch vendor.
On Thursday, the German business software company will launch a new advertising campaign targeting customers not only of PeopleSoft but also of J.D. Edwards & Co., which PeopleSoft agreed to acquire last week. "The campaign will carry the message that SAP can offer certainty in these uncertain times," said Laurie Doyle Kelly, a spokeswoman for SAP in Walldorf, Germany. "We want to help enterprises understand that we are a solid alternative.
The campaign, which will begin in the U.S., will later be extended to "key markets" around the world, said Doyle Kelly, declining to say which markets would be targeted next.
To help woo customers away from PeopleSoft and J.D. Edwards, SAP plans to offer financial incentives. "The scope of the incentives will depend on many different variables but they will be attractive -- that's for sure," Doyle Kelly said, also declining to provide details about conditions and prices.
In yet another step, SAP plans to invite key customers of both companies to attend its Sapphire product show and conference in Orlando, Florida, next week. "This isn't something we've done in the past but the market is undergoing some huge changes and we think the timing is right," she said.
It's not the first time SAP has made a big effort to lure customers away from a competitor. While the Dutch software company Baan Co. NV was in the process of being acquired by the private-equity investors Cerberus Partners LP and General Atlantic Partners LLC around three years ago, SAP snatched nearly 50 Baan customers.
For sure, SAP, which supplies software for mostly large companies to manage their finances, customers, human resources, manufacturing and other operations, has a competitive portfolio of products to offer. But it remains to be seen how many PeopleSoft and J.D. Edwards customers, no matter how concerned they are presently, are willing to abandon their investments and switch to a rival, analysts warn.
"One group of customers will certainly be interested in what SAP has to offer, while another group is unlikely to budge anytime soon, if at all," said Ed Thompson, an analyst with Gartner Inc. "Customers who have bought and deployed PeopleSoft's Version 8 software over the past 18 months won't budge. They aren't about to toss away that investment and go through another major migration process."
It's the group of users still using the company's Version 7 product who could be tempted to jump ship, according to Thompson. "These are the customers both SAP and Oracle are interested in," Thompson said. "They're going to have to make a migration at some point and if it's not to the newest version of the PeopleSoft software, then why not SAP or Oracle."