Oracle Adds RightNow to Cloud Wars Arsenal

Oracle has closed on its US$1.5 billion acquisition of RightNow, developer of a cloud-based customer self-service application. Oracle announced the deal in October 2011.

For Oracle, the deal makes eminent sense: It fills in a missing gap in its cloud-based CRM functionality and gives it a broader base from which to compete against Salesforce.com. In general, it gives Oracle a boost in the cloud wars, especially for mid-tier companies looking for moderately priced applications.

Ever since the acquisition, customers have been asking about the road map for product integration. For a master acquirer like Oracle, combining the two product portfolios should be relatively easy.

Oracle declined to provide further details. However, the company said it will provide more details on the product strategy for the combined Oracle and RightNow offering in a webcast presentation on Tuesday.

Road Map Speculation

Some elements of this integration road map are easy to guess at, Nucleus Research Vice President Rebecca Wettemann told CRM Buyer.

“Obviously, RightNow’s strength is in customer self-service, so Oracle will play that up, along with the knowledge base needed to integrate the application,” she said.

“There are two real factors that I think Oracle will have to look at from an integration perspective,” said Ed Shepherdson, senior vice president of enterprise solutions at Coveo.

“The first is where does RightNow fit within the suite of CRM tools that Oracle already has,” he told CRM Buyer “so the sales and marketing teams will have to quickly differentiate the value proposition.

“The second part of the integration is the physical integration of the RightNow product into the process flows and integration with the process flows of other products in their suite,” Shepherdson continued. Being a cloud product, this level of integration may only be at the interface level.”

A Visible RightNow

RightNow customers will be facing their own challenges, Shepherdson predicted. “They have gone from a vendor-agnostic environment to a being a part of a vender stack.”

However, the RightNow customer base tends to be very loyal, “so we don’t expect to see RightNow products disappear overnight,” Wettemann pointed out.

“Oracle learned from PeopleSoft and other acquisitions that you want to retain those customers and make them feel comfortable that they will still get value from their investments,” she added. “Social, mobile and big data analytics are all areas we expect Oracle to incorporate into the customer experience.”

One of the drivers behind Oracle’s pursuit of RightNow, reflected in a recent Gartner survey, was the digital customer experience as a strategic imperative for CIOs, noted Ashu Roy, CEO of eGain.

“This acquisition validates this trend, fueled by dynamic customer engagement models like social collaboration and multichannel commerce,” he told CRM Buyer. “Smart businesses will increasingly seek out innovative, knowledge-powered customer experience platforms that easily integrate with their existing business management infrastructure.”

Integrating with Oracle’s Public Cloud

Whatever Oracle’s RightNow product integration road map will be, it is bound to be tied to its own initiative in this space — the Oracle Public Cloud, which the company launched few weeks before it announced it was acquiring RightNow.

The Oracle Public Cloud is a tech stack that provides access to Oracle Fusion Applications, Oracle Fusion Middleware and Oracle Database. It runs on Oracle systems and also includes Oracle Fusion CRM, HCM, Social Network, Java and Oracle Database Cloud service — in other words, a number of different business applications. Soon to join the mix, presumably, will be self-service.

An Old Competitive Play

Perhaps the only thing certain at this point is how Oracle’s and RightNow’s competitors will react, Shepherdson said.

“Whenever a company gets acquired, there will be disruption in the sales cycle and the product positioning for a period of time,” he pointed out. “Customer doubt will come into play, so it is an advantage to RightNow competitors.”