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North American Mobile CRM Market:Investment Themes Driving the Mobile CRM Space
Swarna Pasupathi, Research Analyst
Business and Financial Services
Information and Communication Technology
September 30, 2008
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Focus Points
� Introduction
� Market Overview
� Investment Analysis
� Scorecards
� Question and Answers
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• Frost & Sullivan’s Financial Research team has recently completed an extensive review of
investment opportunities in the North American Mobile CRM market.
• The study highlights the growth segments in the North American Mobile CRM market, and
identifies specific investment themes and opportunities within the market.
• It includes a comprehensive overview and in-depth financial analysis of the North American
Mobile CRM universe covered by Frost & Sullivan.
Introduction
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Focus Points
� Introduction
� Market Overview
� Market Segmentation
� Industry Economics
� Investment Analysis
� Investment Themes
� Growth Monitor
� Scorecards
� Sector Scorecard
� Mergers & Acquisitions Analysis
� Venture Capital Score Card
� Venture Opportunity Score Card
� Question and Answers
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Market Overview - Segmentation
Segments Focussed
• Mobile Sales Force Automation (SFA)
• Mobile Field Service Management (FSM)
Major Industry Participants
• COGNOS
• Oracle (PeopleSoft and Siebel)
• Salesforce.com
• SAP AG
• Maximizer Software
• Vettro
• Dexterra
• SAGE
• Sybase – iAnywhere Solutions
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Market Overview
• Enterprise inclination towards mobility platform is on the rise.
• Growth: CRM spending is growing at 11.8% CAGR
• Opportunity: Mid-market is still under-penetrated; only 20% of SMBs use mobile CRM
and the rest of firms are in decision-making cycle to adopt mobile platform during the
period 2008-2012.
Despite an economic slowdown SMB’s will continue to invest in mobile solutions :
• Competitive Advantage
• Increases Productivity with less staff
• Increases Customer Satisfaction
Market Overview Market Segmentation Industry Economics
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ENHANCERS
INHIBITORS
�Increases Productivity and ROI
�The concept of mobile-commuting
in the workforce offers flexibility thereby
increasing the overall productivity of the
team.
�The is an increase in the number of
vendors offering of Mobile-CRM
integration applications.
�Steady tariff plans from Mobile
Network Service Provider
�Subsidized mobile device
prices have reduced the deployment
cost for organizations.
�Availability of varieties of high
powered mobile devices has created
a robust platform for mobile application.
�Lack of justifying the total
cost of ownership (TCO)
�Non-Acceptance of Technology
�Security and Integration issues on
mobile devices stunt growth in the
SMB segment
�Increase in Number of Vendors
�Information Lag
�Slow rollout and adoption of next
generation networks
Industry Economics
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Investment FrameworkInvestment Analysis
1. Standardization of Mobile Network Operator’s Tariff Plans
2. Decrease in the Mobile Device Price
3. Immense Increase in Smartphone Shipment Worldwide
Investment Themes Growth Monitor
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Investment FrameworkInvestment Analysis
Source: Frost & Sullivan
1. Standardization of Mobile Network Operators Tariff Plans
Investment Themes Growth Monitor
0
20
40
60
80
100
120
300 600 900 1500
Anytime Minutes
Netw
ork
Serv
ice C
ost
($)
Verizon T mobile AT & T Sprint
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Investment FrameworkInvestment Analysis
Source: Frost & Sullivan
2. Decrease in the Mobile Device Price
Investment Themes Growth Monitor
0
100
200
300
400
500
600
700
2003 2004 2005 2006 2007 2008
Years
Mo
bil
e D
evic
e P
ric
e (
$)
Windows Mobile Palm Treo Blackberry Apple
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Investment FrameworkInvestment Analysis
3. Increase in Smart Phone Shipment Worldwide
Source: Frost & Sullivan
Investment Themes Growth Monitor
0
20
40
60
80
100
120
2004 2005 2006 2007
Year
Un
its
Sh
ipp
ed
(M
illio
n)
Shipment in Smartphone Devices Worldwide
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Investment FrameworkInvestment Analysis
Source: Frost & Sullivan
40.060.015.0-20.024.44,064.0SAP AG
20.080.015.0-20.043.0557.9Salesforce.com
35.065.015.0-20.047.09,460.0ORACLE
100020.0-25.01.320.4ASTEA
15.020.6Segment CAGR (2007-2012)
FSM
(%)
MSFA
(%)
Growth Rank
(%)
NA Mobile CRM Revenues in 2007
($ Million)
Company’s Total NA Revenues in 2007
($ Million)
Company
Investment Themes Growth Monitor
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Focus Points
� Introduction
� Market Overview
� Market Segmentation
� Industry Economics
� Investment Analysis
� Investment Themes
� Growth Monitor
� Scorecards
� Sector Scorecard
� Mergers & Acquisitions Analysis
� Venture Capital Scorecard
� Venture Opportunity Scorecard
� Question and Answers
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Segment Opportunity Scorecard
Venture OpportunityMergers & Acquisitions Venture CapitalSector Score Card
Sector Average Company
Size
Number of Companies
Revenues ($ Million)
CAGR %
(2007 – 2012)
Sector Consolidation
Attractiveness to Venture
Capital Partners
Small < 15 25.3 Low-Medium High
Medium < 10 46.8 Medium–High Medium MSFA
Large < 5 132.9
15.0
High Low
Small < 30 19.8 Low–Medium High
Medium <10 56.9 Medium Medium MFSM
Large < 5 210.9
20.6
High Low
Small < 10 19.0 Low High
Medium <10 42.6 Medium–High Medium MSFA and MFSM
Large < 5 160.2
15.0 – 17.5
High Low
Source: Frost & Sullivan
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Segment Growth – SFA & FSM
Source: Frost & Sullivan
Venture OpportunityMergers & Acquisitions Venture CapitalSector Score Card
0.0
200.0
400.0
600.0
800.0
1000.0
2007 2008 2009 2010 2011 2012
Years
Gro
wth
$ M
illio
n
SFA FSM
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Venture OpportunityMergers & Acquisitions Venture CapitalSector Scorecard
Source: Frost & Sullivan
Mergers and Acquisition Analysis
1005.3949.05,000.0Business
IntelligenceCOGNOSIBM12-Nov-07
1005.078.8394.0Business Analytics
Visual Sciences
Omniture Inc
25-Oct-07
1005.41,250.06,780.0Enterprise
Software
Business
Objects
SA
SAP AG7-Oct-07
%OwnedAfter
Transaction
Revenue Multiple
Target Revenue ($ Million)
Deal Size
($ Million)
Business Acquired
Target Company
Acquiring Company
Date Announced
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Venture OpportunityMergers & Acquisitions Venture CapitalSegment Opportunity
Source: Frost & Sullivan
Venture Capital ScorecardFinancial Analysis
C and D14.0 + 5.5Experienced
IT, Biotech,
and Clean
Energy
1985New
Enterprise Associates
17-Oct-
05, 07-
Feb-08
A and B2.0 + 5.75ExperiencedIT and
Healthcare 1978
Draper
Fisher Jurvetson
01-Aug-
04 and
01-Feb-
05
CRMSugar CRM
ExperiencedDiversified1998Thoma
Cressey
N/A0
ExperiencedIT1983Battery
VenturesSince
2003CRMOnyx
Funding Round
Funded Amount ($
Million)
Relevant Experience
of Management
Team
Field of Investment
Year of Establishment
Venture Partners
Date of Funding
SegmentCompany
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Venture Opportunity Scorecard
Source: Frost & Sullivan
Venture OpportunityMergers & Acquisitions Venture CapitalSegment Opportunity
Financial Analysis
Medium-HighMediumMediumHigh86.5MSFA
&
MFSM
Dexterra
Medium-HighHighMediumHigh45.5
MSFA
&
MFSM
Antenna
Software
MediumMediumMediumMedium50MSFA
&
MFSM
Metrix
Overall Attractiveness
Clients and Reputation
Technology Innovation
Application Catering to Mobile Devices
Company’s Funding Till
Date($ Million)
SegmentCompany
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Future Roadmap
• Increased adoption to mobility platform by SMB segment
• The roll out of Apple iPhone and Goggle Android phone
• Emerging Platforms and possible alliances in the future
• Mobile Applications vs. Mobile Network Service Providers vs. Mobile Device
Manufacturers vs. Internet Community vs. Customers
• Innovative, patentable and interoperable mobile application will attract future
investments.
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For Additional Information
• To leave a comment, ask the analyst a question, or receive the
free audio segment that accompanies this presentation, please contact Stephanie Ochoa, Social Media Manager at (210) 247-
2421, via email, [email protected], or on Twitter at
http://twitter.com/stephanieochoa.