Your Options in Order Management Systems

Catalogers use a remarkable variety of systems to manage their businesses. Accounting software packages such as QuickBooks do the job at many smaller catalogers, while larger companies have done well with a package like Great Plains, often using the services of a value-added reseller to customize the system to meet their specific needs.

Some order-management packages function as companions to an accounting system. For instance, OrdersPlus works with the BestWorks accounting suite from Best Software. The Everest system from iCode also falls into that category (several iCode systems are derived from an accounting/manufacturing foundation).

Other catalogers have adapted enterprise resource planning (ERP) systems, including large-scale systems (e.g., SAP or Oracle’s business suite), to their order-management requirements. Still other catalogers, not finding a packaged solution they can live with, have written their own systems.

Taken together, such alternatives most likely account for 15 percent to 20 percent of all catalog companies. And as disparate as catalogers are, they have one thing in common: They’re not using one of the three dozen catalog management software (CMS) applications, i.e., systems specifically designed for managing a catalog company. (Actually, users of packaged systems in this miscellaneous category most often aren’t even aware of CMS alternatives.)

Catalog management systems have been around since the late 1970s, when companies poured several million dollars (when that was real money) into developing systems in-house on minicomputers (in the pre-PC era) to manage their catalog businesses. To recoup some of their investments, they licensed these systems to others (usually through a third-party software company). Eventually, the software firms took on a life of their own, and other competitors followed.

Today, about three dozen CMS packages are on the market, ranging from shrink-wrapped systems costing a few hundred dollars to massive enterprise applications costing tens of thousands to acquire and install. The following summary may help you better understand the range of choices available.

Systems Available

Clearly, catalog management systems are the most completely configured systems for running a direct commerce business. They support order entry for first-time customers without first requiring a separate, lengthy customer set-up process (typical of accounting or manufacturing packages). Among other things, they’re designed to handle source-code tracking, customer segmentation and mailing lists, complex kits and sets, promotional pricing, gift shipments, gift certificates, product personalization, flexible fulfillment batching, high-volume picking strategies, and rich customer service views of customer and order data.

Companies that are unaware of CMS options often don’t identify themselves as catalog businesses, but rather as retailers, manufacturers or distributors. Their direct commerce business is either incidental or has grown slowly in the context of a larger enterprise. Not considering themselves direct marketers, managers at these companies don’t often read direct marketing trade publications, which is one of the few places they can find out about CMS (other than online searches — but if you aren’t looking for such systems, you’re not as likely to find them).

This point is worth revisiting, because it establishes something else that’s critical to appreciating catalog management systems. Unlike vendors of systems for accounting, ERP, manufacturing, customer relationship management or supply chain management, virtually all CMS vendors are relatively small companies with, at most, a few hundred users.

The rare exception is a company like Dydacomp, which sells the shrink-wrapped application Mail Order Manager (M.O.M.), in use at thousands of direct commerce companies, giving it as large a share of the market as all the non-CMS systems combined. Not surprisingly, Dydacomp also advertises M.O.M. widely, and is thus able to gain visibility in nondirect marketing circles.

M.O.M. belongs to a group of entry-level systems intended to help companies get started in direct commerce fulfillment. Other entry-level applications include: Mailware from Core Technologies, POS/OE from EES (runs on both Apple- and PC-based systems), OrderMate Pro from Tamalpais Technologies, and Stone Edge Order Manager from Stone Edge Technologies. There’s also the Wizard from NewHaven Software, which recently was superceded by NewHaven’s CMS application, and which actually shares many of the characteristics of the enterprise systems (see below).

Though not all of these entry-level systems are literally sold shrink-wrapped, they may share several characteristics:
- They’re inexpensive, costing a few hundred to a few thousand dollars for a handful of users.
- The user sets up the system on his own.
- Users don’t typically get initial training from the vendor, though it may offer some general training classes.
- The systems generally aren’t customized by the vendor for any one user, even though they are, in fact, configurable.

An entry-level system often can help a company to grow. As it does so, you may become aware of limitations in the system’s functionality, and could decide that further growth can be enabled only by a system with broader or more complex capabilities. This isn’t a failing in the entry-level system so much as a natural progression in your company’s growth.

Taken together, the entry-level solutions account for 20 percent to 30 percent of catalog company users.

Enterprise Systems

Non-CMS and entry-level solutions (and the handful of in-house-developed applications) account for roughly half of the installed base in the catalog community. The other half uses enterprise-level systems. Typically, these share the following characteristics:
- They generally cost a few thousand dollars for a basic configuration, but range in the mid-five figures for 12 to 25 users, and can cost hundreds of thousands of dollars for a large user base.
- System implementation almost always is undertaken by the vendor, or with vendor assistance.
- Training from the vendor is an important and necessary part of getting the system installed.
- The vendor often makes reasonable modifications (at additional cost) to customize the system for each user.

Enterprise Systems can be grouped into four categories:

• Systems based on the Microsoft SQL/Server database (about 400 users). These include Response from CoLinear Systems; CMS from NewHaven Software; Direct 500 from Computer Solutions; Ecometry SQL from Ecometry; 4S for Direct Commerce from Four Seasons Software; InOrder from Morse Data Corp.; and Natural Order from Natural Solutions.

• Systems built on a multivalue database system such as Informix or D3 (about 300 users). These include Avexxis; Terno-Velocity from Terno & Associates.; ACT I from Rigden; MACH2K from Data Management Associates; and ZEBS from Zircon. These systems can run on either a Microsoft Windows or a UNIX platform.

• UNIX-based systems (about 200 users). There are three packages: Ecometry Oracle from Ecometry, Controller+ from Sigma Micro and MOSP from Datamann. They’re written in COBOL and designed to serve the demands of very large enterprises (Sears runs on Controller+, for example).

• Systems running on the DB2 database on IBM eSeries hardware (about 300 users). The three systems in this category are CW Direct and its suite of multichannel modules from CommercialWare, OrderPower! from Computer Solutions, and Directions from Peppler & Associates.

ASPs

Finally, there are two systems available on a hosted basis (from Application Service Providers, or ASPs): OrderMotion from CommercialWare and I3C from Web-Ideals (less than 100 users). These browser-based solutions, priced on a pay-per-usage basis, are fully configured applications with functionality similar to enterprise systems. For companies that don’t have a large IT staff, or that don’t want to make a major up-front investment, these are worth some serious consideration.

Ernie Schell is author of “The Guide to Catalog Management Software” and president of Marketing Systems Analysis, a Southampton, Pa.-based corporation that helps catalog companies specify and select order-processing software. Reach him at ernie@schell.com, or (215) 396-0660.