Why Infor is Buying Saleslogix

Why would any company want to go into competition with Salesforce in the customer relationship management (CRM) field? Infor wants to do just that with its acquisition of Saleslogix.

Infor, based in New York City, reportedly plans to transform the Software-as-a-Service-based CRM company into Infor CRM. Translation: it plans to build the better mousetrap by blending Saleslogix' strength in CRM with its own cloud-based product, Infor CloudSuite.

This is no small task. Infor, which did not disclose the purchase price, said it plans to make a major investment in the existing Saleslogix system to make it more scalable, improve usability and then  tap into Infor's "deep expertise" in industry processes.

Vertical Reach

That last point may be the most critical, and Infor CEO Charles Phillips spelled it out when the deal was announced last Thursday. He noted that most CRM systems track only "a small subset" of data on customers.

"Infor's industry applications have a vast repository of information on a customer's overall interactions derived from deep industry processes we automate," he said, "and we'll build-in context analytics that deliver unique customer insight."

That is a proprietary advantage that Infor, a much smaller company that Salesforce or other large players, is betting will give it an edge in a market that Gartner estimates s is worth $24 billion now and will be worth more than $42 billion by 2018.

"Infor can now deliver the first truly end-to-end demand-to-supply chain, from lead to shop, by integrating marketing and sales processes with supply chain planning, sales and operations planning, and production scheduling in real time," said Phillips.

In other words, while competitors may offer a strong CRM product, Infor anticipates strong demand for CRM applications that are "pre-built into industry suites as more companies seek to take advantage of vast data from across the enterprise in sales and service efforts."

That view was echoed by H. John Oechsle, CEO of Scottsdale, Ariz.-based Swiftpage, which currently owns Saleslogix. "Infor ... can provide the size, scale and resources to position Saleslogix as a leading product globally," he said in a statement.

For its part, Swiftpage,  which also owns Act!, plans to focus on smaller customers. "By doubling down on Act!, we can continue to increase the value we deliver to our customers while accelerating the growth of the Act! portfolio worldwide," said Oechsle.

When the deal closes, which is expected to happen within a few weeks, Infor will have another benefit to add to the mix. It currently has about 70,000 customers and Saleslogix has about 1,700. They have, however, only about 300 clients in common, giving Infor another 1,400 prospects for its core services -- a valuable commodity in itself in the highly competitive cloud services marketplace.

Title Image by Drew Horne / Shutterstock.