SugarCRM repositions as CX Platform. A sign of “Peak CX”?


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Source: Pixabay

SugarCRM recently announced that it was “Driving the Future of Customer Experience with Powerful Products and New Vision.”

As the “CRM” part of SugarCRM suggests, the company sells solutions for sales, marketing, and customer service. Sugar Sell is best known because sales automation is what the company offered when it launched in 2004 as an open-source project. “Commercial” versions were available for sale that included more function and support. Marketing and service solutions came only recently — more on that in a moment.

Ah, those were the go-go days of FOSS. Perhaps concluding that free software was undercutting revenue, the open-source version was killed in April 2018.

Later that year, private equity firm Accel-KKR become SugarCRM’s sole investor, reportedly for a “nine-figure strategic and significant investment.” Typically PEs do buy-outs as part of a restructuring to boost performance, so the company can be sold for a profit later, or go public. As of last year, SugarCRM reportedly booked around $100M/year and planned to double that with the help of Accel-KKR’s investment and organic growth.

Early this year, Craig Charlton entered the picture as a new CEO to drive that growth. A seasoned tech executive with eight years of experience in the PE world, Charlton told me his goal was to reinvigorate the brand and “turn a good company into great.”

Finally, a full CRM suite

Back in the day, “CRM” was a label applied to just about any solution automating sales or marketing or service. Siebel and many others, through development and acquisition, repositioned CRM to mean a full suite: sales and marketing and service, built around a shared database to provide a “360-degree view of the customer.” SugarCRM apparently never got that memo and stuck with sales automation.

Until now. Three months ago, Charlton decided to fill the marketing automation element with the acquisition of Salesfusion. SugarCRM CTO Rich Green said they’re working to integrate what is now called Sugar Market into the shared data model underpinning the new suite, which now also includes…

Sugar Serve, a case management solution which Green says was developed in the past year as an enhancement to a lighter weight service capability found in the core SugarCRM product.

Green emphasized that the product strategy was not just about offering the usual CRM point solutions, but to do so in a platform using advanced AI-based analytics and services. And that brings me to the subject of CX.

Intelligent CX platform

All of the above makes a lot of sense to me. An impressive amount of change in a very short time. But I found the positioning as a “CX platform” interesting, to say the least.

Here’s a diagram of the SugarCRM platform:

Source: SugarCRM

Why the “CX” positioning for what most would call a CRM upgrade? Charlton explained that he learned via a customer listening tour that CX was driving their strategies, and SugarCRM’s intent is to provide the tools to help them execute.

Fair enough, but pretty much everyone has jumped on the CX bandwagon. That’s what led me to write a slightly tongue-in-cheek post that CXTech is a $1 Trillion Market.

SugarCRM hopes three capabilities will provide differentiation in the very competitive CRM er CX market. I asked Green to explain what these terms mean.

  • Time Aware Customer Data Model — capture data over time, not just at a point in time as sales solutions commonly do. Time-based storing of data is especially useful in marketing, but can also be applied to service and sales for next-best-action recommendations.
  • No-Touch Information Management — reduce the time for users to enter or review information by proactively (based on analytics) sending alerts on action needed. Another job where AI/ML can help.
  • Continuous Cloud Innovation — sure, use the cloud to host apps, but don’t stop there. SugarCRM plans to leverage microservices such as Amazon’s machine learning to deliver innovation faster.

Have we reached peak CX?

Source: Wikipedia

Remember “peak oil“? That was a theory that oil production would peak in 1970, and then decline. Good theory, but failed to account for new sources/methods, such as fracking. As you can see from the chart, oil production in the US seemed to follow the predicted decline until about 10 years ago, when production started climbing again.

Most business executives claim they want to compete based on CX, although enthusiasm may be waning. Reality is setting in that CX is (really) hard work, if you want to move the needle on company success, that is. According to this article, Gartner predicts a shift in CMO priorities to profitability, due to “more realistic expectations and utilisation of data and technology in marketing departments, including the increased adoption of artificial intelligence (AI), as well as a correction in customer experience hype.” (my emphasis added)

I could add that a looming recession will quell CX happy talk, unless cold, hard benefits can be proven. Unfortunately, my latest study found only one in four CX initiatives are able to quantify business value. I fear a lot of well-meaning CX efforts will be paused when business slows. For vendors, that could make marketing “CX” solutions problematic.

The future could be sweet

SugarCRM’s future will be bright if it can execute well on Charlton’s priorities: Creating a renewed sense of purpose, re-building the brand to become known for a full suite, and delivering a competitive solution that helps business leaders deliver on their CX dreams. That’s easier said than done, but Charlton’s background suggests he has the chops to pull it off.

Independent CRM analyst and CustomerThink Advisor Thomas Wieberneit agrees with the platform strategy if the goal is to compete with tier one vendors. He also says “experience” is the term all the vendors seem to be using, so “there is no way around it.” True, but doesn’t go to market as a CX solution, and “customer engagement” is favored by a few brave souls that aren’t betting the farm on CX.

Still, marketing a “CX platform” could open doors and stimulate some to take a fresh look at SugarCRM, as I just did. But after that door opens, the revitalized SugarCRM organization will need to show they can bring real value, whether to support CX strategies or more prosaic automation à la CRM. A downturn and subsequent tightening of budgets could see a shift to efficiency and profitability, where SugarCRM has much to offer.

Disclosure: This post is part of my independent coverage of industry developments and is not an endorsement of any companies mentioned. SugarCRM has not been a CustomerThink sponsor.


  1. Interesting. That diagram looks very similar to one you might find on SFDC’s website. I think the giants are finally noticing CX and either acquiring it (ahem….SAP) or creating it (SugarCRM, SalesForce). I think it is interesting to see this transformation as some companies chose to drop the “C” in “CX” in favor of just “X”. The cross pollination is finally happening. I just wonder if the CRM folks really can get their heads around other use cases beyond solving individual problems and campaigns vs, looking at institutional “outer loop”. One2One marketing was great in that it ushered and promoted way to execute individual personalization. However, it think the atomistic perspective may have blinded some to the larger institutional issues that can make or break companies. It’s not about making sure your isn’t cold and then fixing it; it’s about figuring out and fixing why the soup was cold in the first. As usual insightful and enjoyable read Bob.

  2. Yes, agreed, Dave. The diagram looks similar to ones that could come from SFDC or from SAP, or MS. Of course it has some Sugar twist, like the CDP that is below, which does not always come up. SFDC might not prominently put CX on their web site, but still this is what they sell. I have seen their salespeople doing this all the time when heads on against SAP or MS. And even here in Germany, SAP’s home turf, one runs into SFDC more often than not 😉

    Currently MS, Oracle, and SAP are the tier one vendors that could best address the bigger problem that Dave mentions. They have the solution set needed to do so, including the ERP and supply chain systems, whereas SFDC needs to plug into these (e.g. via its Mulesoft or Tableau acquisitions). Yes, the issue permeates the whole company and has to do with combining experience data with operational data – hence SFDCs need to plug into operational data.

    I am a bit at a loss why Dave has the impression that SFDC is not acquiring CX targeted vendors. According to Crunchbase there are already 6 acquisitions this year with Clicksoftware and Tableau being the prominent ones.

    Re Sugar … I agree that the company needs to execute very well on their path, with highly targeted value propositions for their customers that include fast value creation for them. Will be interesting to see.

  3. Hi Thomas, yea, that’s kind of the rub. First, Tableau, in mind, is data viz software not a holistic CX solution IMO. It is used as a dashboard in the CX systems i have seen. Not as familiar with Clicksoftware, but that appears to be a one to one communication tool more than a full fledged CX platform. There is a difference between solving individual problems (which is one use case amongst a few) and what Medallia, Qualtrics, InMoment, MaritzCX, and others do. I think this is an on-going misunderstanding between the traditional CX providers and newer entries… of course i could mistaken too as I am not as familiar with those systems as I am with CX systems.

  4. Hi Dave, looks like I expressed myself somewhat ambiguous. Yes, all these acquisitions by SFDC are in essence point solutions. Clicksoftware is more of a field service solution. The acquisitions serve the purpose of making SFDC a platform with full fledged CX capabilities. With naming them I merely wanted to make the point that nearly all of the tier one vendors are combining make and buy.

    Qualtrics is an interesting case. I am still trying to get my head around USD 8 bn as the purchasing price. Where do you see this kind of valuation, if not in data?

  5. Ah. Yes, i think the components approach is interesting…but somewhat tricky to ‘harmonize’ different platforms. Can get messy. yea, i think every one is a little blown away on the Qualtrics deal. Hats off to those guys, but I am not sure I would have paid $8 billion dollars. Then I again I don’t have that kind of money so what do I know? 😉

  6. If you think of CX as a combination of listening and experience delivery, then perhaps only SAP has a complete CX tech platform. Qualtrics fills the listening part, although mainly for survey-based feedback.

    SugarCRM is just the latest of the CRM vendors repositioning as CX, but without a VoC solution. So, hardly a “complete” end-to-end platform, but still can be applied to improve CX delivery. has a lot of the components (save ERP and VoC) and could be sold to improve CX to certain customers if that’s their priority. But I don’t see staking its main positioning on CX. Visit the home page and you’ll see “Connect to your customers in a whole new way with the world’s #1 CRM platform” with solutions known as “Salesforce Customer 360.”

    On the other hand, there are many VoC (EFM) vendors also claiming they are a complete CX platform. While they do a more comprehensive job on the listening part compared to Qualtrics, they don’t directly support CX delivery.

    “CX” represents an intent to make life better for customers (outside-in). “CRM” is more typically thought of improving what companies get *from* customers (inside-out). Both are needed in good businesses, don’t you think?

    Technology could be cast as CX or CRM depending on intent. I think many if not most tech vendors are happy to sell to whatever business goals customers have. Right now CX is the hot topic, but if the economy turns, that won’t last long, and neither will CX marketing campaigns.

  7. Bob, I think with your last paragraph you hit the nail square on. I do think that it is about e2e processes that make things easy (and enjoyable?) for customers and employees. CX is the current mot du jour. Looked at things holistically, what is needed is a ‘dark’ transactional system that offers a unified data model (via a business entity orientated interface, as opposed to central database) and that is surrounded by systems of engagement that address the needs of the different (means all relevant) user groups


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