The Best ACT! Is Still to Come

Event Summary

Anyone involved in sales during the eighties would surely remember ACT! as the crucial contact management tool. The competition was fuzzy until the dawn of customer relationship management (CRM) when vendors appeared offering new packaged applications that included contact management, marketing automation, sales force automation, and call center management. Now, more than a decade later, the odds dictated that ACT! should have been overshadowed and its market share divided up among the new packaged applications. However, a few acquisitions later ACT! has still managed to maintain its raison d'tre, retaining over two million users in North America alone.

Looking to further consolidate its leadership in the lower-end CRM marketplace, ACT! is once again undergoing a face-lift in presenting new features and functions that respond to the latest market trends. This innovative initiative by Best Software, the American subsidiary of the UK-based Sage, Group plc, is due to take place in late August 2004, with the solutions now available in two versions: ACT! 2005 and ACT! 2005 Premium for Workgroups.

Product Definition and Market Impact

Management at ACT! sees an opportunity to increase the lifetime value of its loyal customers in two ways. By providing a broader assortment of functionality, customers' requirements will be fulfilled over a longer period of time. In addition, by intentionally reducing the market gap that currently exists between ACT! and its sister products, transitioning from ACT to Best's other CRM solutions will be an organic process. This is a valuable opportunity to leverage Best's existing customer base and marketing potential.

As Joe Bergera, senior vice president and general manager at ACT! explained, traditional market segmentation strongly positions ACT! in the 14 user category, representing 40 percent of the company's customer base. Interestingly enough, research shows that the software is currently very well received in sales departments of larger organizations housing more than 500 employees. As Beth Kohler, senior product manager at ACT! explained, it appears as though sales representatives are using the solution as their own private contact information organizer and then reprocessing the data into other co-existing CRM solutions like Salesforce.com, Siebel, or SAP. Clearly, the inexpensive contact management software for small businesses is playing a transitional role for sales representatives in bigger organizations. A logical deduction is then that either sales populations have difficulties in working with upscale and complex CRM tools, or that ACT! has done an excellent job of making the sales population fervently loyal to their product.

How and how well will Best seize this opportunity in leveraging its existing customer base and marketing potential? Since Sage/Best acquired ACT! in 2001 and presented ACT! version 6 to the marketplace, the company has taken slightly over three years to introduce ACT!2005 representing version 7, with over fifty new features and many usability enhancements. This new version reflects a more long term strategic positioning.

As far as the product goes, ACT! 2005 provides several additional functionalities to satisfy requirements from a sales force automation (SFA) application including better opportunity management, enhanced activities and calendars. In order to clearly target the larger workgroups ACT! 2005 had to improve data accessibility and security. Some improvements are intended to empower sales management with better visibility and reporting tools that can export organized data with ease.

More importantly, there are new technical improvements that reflect more current and Internet-based technologies. While ACT! 2005 supports 110 users, an additional version intended for larger sales teams and workgroups, ACT! 2005 Premium for Workgroups is targeted for 550 users. Both new versions boast an MS SQL database allowing improved scalability and make use of a complete .NET platform providing a more reliable code base ready for total Internet accessibility. The development of a web client version is, however, only due at the beginning of next year. Opportunity management improvements include features such as new templates that follow sales stages accurately, along with a completely new quote generation functionality that together move ACT! out of the arena of solely contact management and into the world of sales force automation.

Strategy and User Recommendations

The new features and improved functionalities give the solution a chance to cover a greater area of the competitive landscape. Increased functionality in the area of sales and operations management increases the solutions' potential to wrestle market share away from competitors such as Salesforce.com, Goldmine, and MS CRM. This recent upgrade is in fact the most significant since ACT! came into existence as a contact management solution in 1987. The new ACT! 2005 will extend the current market leadership from lower-end, small- and medium-sized companies to the mid-range CRM marketplace. This will provide ACT greater opportunities allowing for penetration into new segments while providing a more up to date technology platform for future product advances.

The new ACT! 2005 is set to offer advantages over Goldmine in end user advanced searching and ease of use and MS CRM in end user customizability and user-based administration In the workgroup environment the new ACT aims at surpassing Goldmine in user customizability and advanced searching. ACT! 2005 aspires to outperform MS CRM in terms of end user customizability and user based administration.

ACT! continues to integrate well with a variety of accounting programs available from Sage and Best such as MAS 90 and MAS 200, the Sage line products, MYOB Accounting as well as Peachtree and QuickBooks.

The launch of ACT! 2005 poises Best to effectively close the gap that has to date existed between ACT!, ACCPAC and SalesLogix. A strategy that is sure to be effective in retaining customer loyalty as user requirements grow.