At the analyst portion of ShoreTel's partner conference in July, CMO Kevin Gavin painted a picture of a growing, healthy company whose revenues increased from $32 million in Q4 2009 to $51 million in Q3 2011. ShoreTel sees expanding its presence outside the US as one of the keys to continued growth. This was reflected in a before/after snapshot of the number of countries ShoreTel sells into, as well as localization of its software: In 2005 the company sold in five countries and had localized products in four languages. In 2007 it was 10 countries and 7 languages, and now 48 countries and 21 languages. However in many of the countries where it does business, ShoreTel has minimal presence, both in terms of employees stationed there and resellers dedicated to selling and supporting products in the region. Expanding its international presence with feet on the street and trained channel partners remains an ongoing initiative, as Peter Blackmore noted in a recent blog.
The enterprise market was presented as another key to growth. Kevin Gavin, CMO, pointed out that 26% of the ShoreTel customer base deployed fewer than 100 licenses, 31% more than 500 and the rest somewhere in between. Now, if you're a glass-half-full sort of person, then 74% of ShoreTel customers have more than 100 licenses. And if you have a half-empty mindset, then 69% of ShoreTel customers fall squarely into the SMB category.
Regardless of how you think of your glass, the customer panel at the conference was put together to emphasize successes ShoreTel has already made with larger-sized enterprises having either non-US or multinational operations. One of these was Markem-Imaje, a Valence, France-based developer of product identification solutions with more than 2,000 employees in 29 locations and 19 countries. CTO Christian Salanon said his company has deployed 2,555 ShoreTel phones company-wide, replacing its Cisco PBX after considering then deciding against an Alcatel-Lucent phone system. The Hay Group, a management consulting firm in Philadelphia, considered transitioning from an aged Lucent-based PBX to a Cisco-based hosted service. Instead it has deployed ShoreTel phones to its 3,000 employees in 90 offices in 47 countries. And Robert Half International, with a whopping 14,000 employees, has migrated over to ShoreTel. This includes a wholly-owned subsidiary that deployed a Cisco PBX in 2007, but last year replaced it with ShoreTel.
Such large enterprise wins, of course, remain exceptions rather than rules when it comes to the ShoreTel customer base, as Gavin's numbers demonstrate. Yet they are indicators of ShoreTel's ability to win business in the enterprise space. Going forward it will be important for ShoreTel to emphasize how its enterprise customers are deploying not just its telephony systems but its contact center, conferencing, and corporate instant messaging and presence software as well. (Markem-Imaje, for example, has deployed ShoreTel's Workgroups contact center software and will be migrating to the company's Enterprise Contact Center platform before long.) Server virtualization, mobility and cloud-based telephony are also areas of interest for enterprise, and ShoreTel has clear product development initiatives in each of these areas. Yet it remains behind its main competitors, at least when it comes to virtualization and cloud initiatives. So it will be interesting to see if going forward, ShoreTel will be able to replicate its successes in selling distributed PBX systems to enterprises, but advanced communications applications too.
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