Netsuite Competitors Analysis

Founded in 1998, NetSuite is a leading provider of cloud-based business software suites. Its headquarters is in San Mateo, California, with global operations in over 217 countries. NetSuite tailors its software offerings to meet the specific needs of businesses in various industries, including e-commerce, manufacturing, retail, services, and technology.

As part of the Oracle Corporation since 2016, NetSuite prides itself on providing a complete and integrated cloud solution for businesses of all sizes. Its software offerings include enterprise resource planning (ERP), customer relationship management (CRM), global business management (GBM), human resources (HR), professional service automation (PSA), analytics and reporting, and Omni-channel commerce.

Given the diversified nature of its business software solutions, it’s no surprise that NetSuite has several competitors. Its strong suite lies in its comprehensive and integrated cloud solution, which is a major differentiating factor against competitors that don’t offer a complete package. Moreover, it enjoys the strong financial muscle of its parent company, Oracle Corporation.

During Oracle’s fiscal year 2022, cloud services and license support contributed $30.174 billion, or 71% of its total revenue. The cloud ERP revenue increased 27% during the fourth quarter of Oracle’s fiscal year 2022. While NetSuite doesn’t release independent financial information, Oracle reported that Fusion and NetSuite’s cloud applications were a major growth driver for the company. Oracle’s revenue for FY22 was $42.44 billion, up 5% from the previous year.

Below we analyze some of NetSuite’s main competitors and how they compare in terms of features and functionality. We’ll also look at the financials of each company to get a sense of their relative size and market share.

Bottom Line Up Front

NetSuite competes in a market with large and well-established business software providers, such as Microsoft, SAP, and Salesforce. While it doesn’t have the same brand recognition or market share as these industry giants, NetSuite’s cloud-based solutions offer a high degree of integration that appeals to businesses seeking an all-in-one solution. Its main competitive advantage lies in its comprehensive software offerings and the financial backing of Oracle Corporation.

List of NetSuite Competitors

1. Microsoft Dynamics 365
2. SAP
3. Salesforce
4. Acumatica
5. Workday

Oracle NetSuite Business Strategy

More than 31,000 organizations, businesses, and subsidiaries rely on NetSuite’s integrated cloud business software to run complex, mission-critical operations. The company’s target market is businesses of all sizes in various industries that want an integrated cloud solution. As an Oracle company, NetSuite’s mission is to provide a unified and agile application suite that helps businesses accelerate growth, improve operational efficiency, and scale quickly and profitably.

The company’s product strategy is to develop and enhance its software offerings to meet the specific needs of businesses in various industries. However, it doesn’t limit its target market to any specific industry but offers software solutions that companies can customize to fit their needs.

In terms of go-to-market strategy, NetSuite relies on its direct sales force and channel partners to reach its target market. The company has a global network of referral partners, systems integrators, developers, and solutions providers that help it reach its target market. It uses geographic segmentation to target businesses in various regions, including the Americas, Europe, the Middle East and Africa (EMEA), and Asia-Pacific (APAC).

NetSuite’s cost structure mainly comprises sales and marketing, research and development, and cloud service and license support expenses. The company’s revenue model is subscription-based, with businesses paying a monthly or annual fee for access to its software offerings. It also offers support and professional services at a fee.

See also: Best Business Strategy Frameworks For Business Success

NetSuite Competitor Analysis

Oracle NetSuite competes in a highly diversified and competitive market. To maintain its leading position in the market, the company must offer a comprehensive and differentiated solution that meets the needs of businesses in various industries.

Below is a detailed analysis of Oracle NetSuite’s main competitors. We’ve looked at their business model, target market, product offerings, and competitive advantage to better understand the competitive landscape.

1. Microsoft Dynamics 365

Microsoft Dynamics 365 is a cloud-based business software solution that offers a comprehensive suite of applications for sales, customer service, field service, marketing, project service automation, and financials. Part of Microsoft’s Business Applications platform, it competes with Oracle NetSuite in the market for cloud-based enterprise resource planning (ERP) and customer relationship management (CRM) software.

Microsoft Dynamics 365 offers several advantages over NetSuite, including its integration with the Microsoft Office productivity suite and its extensive partner ecosystem. It also provides a lower total cost of ownership (TCO) than NetSuite, thanks to its pay-as-you-go subscription pricing model and the inclusion of support and maintenance in the price.

As per data from Statista, Microsoft Dynamics had a market share of 8.4% in the global ERP market in 2021, whereas NetSuite wasn’t anywhere in the ranks. We could argue that Microsoft’s share is significantly higher if we only consider the cloud-based ERP market, as on-premises ERP solutions are rapidly losing ground to cloud-based solutions.

Microsoft is a much bigger company than NetSuite and has a significant competitive advantage in market share, brand recognition, financial resources, and partner ecosystem. With its deep pockets, Microsoft can easily outspend NetSuite on sales and marketing to win more customers.

2. SAP

SAP SE is a German multinational software corporation that makes enterprise software to manage business operations and customer relations. The company’s first commercial product launched in 1973, and it has since grown to become one of the largest software companies in the world, with over 425,000 customers in more than 180 countries.

SAP offers a comprehensive suite of business applications, including ERP, CRM, financial management, spend management, supply chain management, human capital management, business technology platforms, and other industry-specific solutions. The company competes with Oracle NetSuite in several areas, including ERP, CRM, and financial management software.

The company has a significant lead over NetSuite in market share, brand recognition, and financial resources. However, its products are largely seen as complex and hard to use, allowing NetSuite to win customers looking for a more user-friendly solution.

In 2021, SAP had total revenues of $32.039 billion, up from $31.228 billion in 2020. Its main competitive advantage over NetSuite is that it operates as an independent software vendor (ISV) and provides software solutions to various industries. Unlike NetSuite, which operates under the Oracle umbrella, SAP is not tethered to a specific database or application software vendor. This gives it the flexibility to offer its customers a choice of deployment models, including on-premises, cloud-based, and hybrid.

See also: Workday Competitors Analysis [2022]

3. Salesforce

Salesforce is an American public company that provides customer relationship management (CRM) software solutions. Founded in 1999, it has grown to become one of the largest CRM companies in the world, with a market capitalization of over $182.244 billion as of June 2022.

The company offers a comprehensive suite of CRM applications, including sales force automation, customer service and support, marketing automation, community management, analytics, and application development. It also provides a cloud-based platform-as-a-service (PaaS) that enables customers to build their custom applications.

By focusing on CRM and PaaS, Salesforce has carved out a niche in the enterprise software market. This focus has allowed it to grow exponentially, posting double-digit revenue growth yearly. In its fiscal year 2021, Salesforce reported revenues of $21.252 billion, up from $17.098 billion the previous fiscal year.

Salesforce and NetSuite both target mid-market and enterprise customers. However, Salesforce has a significant lead over NetSuite in market share, brand recognition, financial resources, and ecosystem partners. It is by far the leading vendor of CRM software by about 23.8% as of 2021.

4. Acumatica

Acumatica is a privately held software company that provides cloud-based enterprise resource planning (ERP) software. Founded in 2008, it has its headquarters in Bellevue, Washington. The company sells through a network of over 500 partners in more than 100 countries.

It offers a comprehensive suite of ERP applications, including financial management, distribution management, customer management, project accounting, and manufacturing management. The company also tailors its software to specific industries, such as construction, manufacturing, distribution, financial management, commerce connectors, and manufacturing management. The company’s SaaS platform runs on Amazon Web Services (AWS).

Acumatica is a fast-growing company with a strong focus on small and medium-sized businesses (SMBs). As a private company, it doesn’t publicly release its financials, but Getlanks estimates 2021 annual revenues to be about $24.5 million. Given the current growth rate, it is likely that Acumatica will cross the $100 million mark in the next few years.

The company’s main competitive advantage over NetSuite is its focus on the SMB market. Acumatica offers a more affordable and user-friendly solution than NetSuite, which also targets the SMB market. To stand out in a competitive market, Acumatica has built a robust partner ecosystem and offers its partners attractive margins.

As a privately held company, the company doesn’t have to bow down to the demands of Wall Street and can take a long-term view of its business. However, it lacks the financial resources of a publicly-traded company like Oracle, NetSuite’s parent company. Establishing a strong brand and partner ecosystem will be critical for Acumatica to compete against NetSuite in the long run.

5. Workday

Founded in 2005, Workday is a publicly-traded company that provides cloud-based enterprise management software. The company offers a comprehensive suite of ERP applications, including financial management, human capital management (HCM), and student management. The company trades on the NASDAQ stock exchange under the ticker symbol WDAY.

It stands out as one of the largest and most successful enterprise software companies to have gone public in recent years. As of June 27, 2022, Workday had a market cap of $37.58 billion. In its fiscal year 2021, Workday reported revenues of $5.13 billion, representing a 19.01% growth over the previous fiscal year. In FY 2022, Workday reported $5.398 billion in revenue, up 20.64%% year-over-year.

Workday’s main competitive advantage over NetSuite is its focus on the HCM market. The company has a deep understanding of the needs of HR professionals and offers a comprehensive solution that covers all aspects of human capital management. Workday also has a strong brand and is one of the most recognizable enterprise software companies.

To compete against NetSuite, Workday will need to continue to invest in its HCM solution and expand its product suite to cover other parts of the enterprise management market. While NetSuite enjoys the advantages of being part of Oracle, Workday is equally a formidable competitor with subsidiaries like Peakons ApS, a Danish HR software company, and Adaptive Insights, a business planning Software Company.

NetSuite SWOT Analysis

Below is a SWOT analysis of NetSuite:

Strengths

• NetSuite is a comprehensive ERP software suite that covers all aspects of enterprise resource planning
• The company has a strong brand and is the market leader in cloud-based ERP software
• NetSuite is part of Oracle, one of the largest and most successful enterprise software companies
• It offers customizable solutions that businesses can tailor to their specific needs
• The company has a robust partner ecosystem, with over 2000 partners worldwide

Weaknesses

• Dependence on Oracle could be a risk if Oracle decides to de-emphasize NetSuite
• The company has a high churn rate, with some customers switching to competing products
• It’s complex for businesses to customize NetSuite to meet their specific needs
• NetSuite pricing isn’t clear

Opportunities

• NetSuite can capitalize on the 17.9% CAGR of the cloud computing market expected to reach $791.48 billion by 2028
• The company can continue to expand its product suite to cover other aspects of enterprise resource planning
• It can focus on expanding its customer base in fast-growing markets like Asia-Pacific and Africa

Threats

• The company faces stiff competition from other cloud-based ERP providers, such as SAP, Workday, and Acumatica
• Disruptions in the global economy, such as the Covid-19 pandemic, can lead to a slowdown in enterprise software spending
• NetSuite’s dependence on Oracle could be a risk if Oracle decides to de-emphasize the subsidiary
• Government regulations around the world could impact NetSuite’s business, especially in markets like China and the European Union

NetSuite Competitor Analysis (FAQs)

Conclusion

NetSuite is a leading provider of cloud-based business software suites. Its comprehensive product offering, strong brand, and partner ecosystem give it a competitive advantage in the market. While it stands out as an excellent software solution for businesses, it faces stiff competition from other providers, such as Microsoft Dynamics 365, SAP, Salesforce, Acumatica, and Workday. These companies offer similar solutions and products, but each has strengths and weaknesses.

To stand out, NetSuite has focused on delivering a comprehensive, cloud-based business software suite that offers a broad range of functionality. NetSuite also has a robust partner ecosystem that provides complementary products and services. These differentiators have helped the company gain market share and position itself as a cloud-based business software market leader.

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John Hughes

John Hughes is a seasoned expert in digital marketing strategy, business model analysis, and financial insights. Possessing a robust background in finance, his expertise extends into deciphering complex business models, conducting comprehensive SWOT analyses, and staying attuned to the latest market trends.

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