CRM consolidation continues

Two acquisitions announced last week continue the CRM market consolidation that’s been going on the last few years and highlight the importance of adding a personal touch to companies’ online customer service efforts.

Both acquisitions pair a vendor of knowledge management tools with a vendor of Web collaboration technology. CRM suite vendor Kana Software Inc. is acquiring Hipbone Software Inc., which specializes in online customer service technologies such as co-browsing, file sharing and chat, for an undisclosed amount. Meanwhile, LivePerson Inc., which makes chat, e-mail management and customer self-service software, acquired some of Island Data’s assets — specifically its knowledge management technologies — in a US$3 million stock and cash transaction.

Kana plans to integrate Hipbone’s chat and co-browsing features into its iCare suite, which includes knowledge management, e-mail marketing, call center, marketing and analytics applications. Kana also will continue to offer Hipbone as a stand-alone product, the company says.

Hipbone’s tools let customer service representatives or internal help desk employees provide personal online assistance. For example, with Hipbone’s co-browsing tools, an agent could help a customer fill out an online form or find particular online content. Hipbone has targeted the financial services and high-tech sectors, and its customers include the bank Wells Fargo & Company and Diversified Investment Advisors.

For its part, LivePerson acquired Island Data’s Express Response, a hosted knowledge base and frequently asked questions service. Existing Express Response customers — including Adobe Systems Inc., Canon U.S.A. Inc. and Cox Communications Inc. — will be transferred to LivePerson.

While both acquisitions aim to bolster vendors with a stake in Web self-service and e-mail customer interactions, these channels are not growing as market watchers expected. Art Schoeller, senior analyst at The Yankee Group, reports that the numbers of customers choosing live voice and interactive voice response (IVR) systems to contact companies are on the rise and not declining as expected. While live voice and IVR traffic rates are growing about four per cent, Web interactions are flat, and e-mail interactions are declining at a rate of about five per cent, Schoeller says.

One reason is the affordability of outsourced call centre agents. Instead of adding self-service IP contact center capabilities to reduce cost, some customers are driving support traffic to outsourced centres, Schoeller says. According to The Yankee Group, outsourced agents cost US$24 to US$27 per hour in North America as compared with as low as US$10 to US$12 per hour in Asia for the same application.

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