Magic Software Announces New Web-Based CRM Suite of Products That Provides ``Real-Time Business Pulsing''.

Business Editors and High-Tech Writers

IRVINE, Calif.--(BUSINESS WIRE)--March 13, 2000

Magic eService to Debut at the Internet Commerce

Expo in Boston, March 27-30, 2000

Magic Software Enterprises (Nasdaq:MGIC) Monday announced details of its strategy to introduce a new Customer Relationship Management ("CRM") suite of Web-based products.

The Magic CRM suite, which consists of four separate applications, is designed to improve an enterprise's ability to receive and react to dynamic updates regarding all aspects of customer-related activities ("Real-Time Business Pulsing"), to enhance customer satisfaction and to enable higher levels of corporate profitability.

The four separate applications, including Magic eContact(TM), Magic eService(TM), Magic eSales(TM) and Magic eCapture(TM), can be easily integrated, either independently or as part of a total solution, into existing front- and back-office applications. In addition, enterprises will be able to integrate Magic eMerchant(TM), Magic's industrial-strength e-business solution, with the CRM suite.

Magic, which won a Best of Show award at last year's Internet Commerce Expo for its Magic eMerchant product, will debut Magic eService at this year's Internet Commerce Expo, scheduled to run from March 27-30 at the World Trade Center in Boston.

The Magic CRM Suite

The importance of customer relationship management has intensified with the growth of the Internet. Customer expectations have increased and barriers to market entry have decreased, with competitors only a click away. To address these new market dynamics, companies have had to devise more sophisticated and complex methods for delivering sustained levels of enhanced customer satisfaction.

What has evolved is a new class of Web-based applications commonly referred to as CRM. According to IDC, this is a market that should grow from $33 billion in 1998 to nearly $90 billion by 2003. And, if Jack Dunietz, chief executive officer of Magic, has his way, it is a market in which Magic will be a major player.

"The Magic CRM suite is especially attractive because it helps ensure a better customer experience, while providing management up-to-date customer knowledge that will result in more informed decision-making across the enterprise. This is what Magic refers to as 'real-time business pulsing,'" said Dunietz.

"This improved information flow should have a significant impact on how customers perceive a company and increase a company's competitive advantage."

However, not only does the Magic CRM suite automate all of the activities that follow each customer contact, it also enables each step in the fulfillment process to benefit from the accumulated knowledge of the enterprise.

All customer interactions are managed from a joint enterprise process view, where there is a real-time shared view of the customer throughout the customer's lifecycle across the enterprise. In addition, the Magic CRM suite benefits from the advantages inherent in any applications developed using the company's core technology.

"Because the Magic CRM suite is built using our core technology," added Dunietz, "it benefits from the ability to seamlessly integrate legacy applications, protecting past investments in hardware, software and technical expertise. In addition, the CRM suite is scalable, flexible and can be rapidly customized to meet an enterprise's specific requirements."

The four applications comprising the Magic CRM suite include:

-- Magic eService -- Web-based customer service and support

-- Magic eContact -- comprehensive contact management

-- Magic eSales -- enterprise-wide integrated sales management 

-- Magic eCapture -- Web-based lead capture and reporting

"Magic's CRM suite is a comprehensive solution designed to focus on the customer and optimize the business value across service, marketing and sales," said Dunietz. "It ensures the customer receives consistently high levels of service, while providing management with the information and tools needed to better guarantee correct decision-making and better business control."

About Magic Software

Magic Software Enterprises, a member of the Formula Group (Nasdaq:FORTY), develops, markets and support software development and deployment technology that enables enterprises to accelerate the process of building and deploying applications that can be rapidly customized and integrated with existing systems.

Magic technology, applications and professional services are available through a global network of subsidiaries, distributors and Magic solutions partners in approximately 50 countries. The company's U.S. subsidiary is located at 1642 Kaiser Avenue, Irvine, Calif., 92614, telephone [phone], fax [phone], http://www.magic-sw.com.

The Formula Group is an international information technology company principally engaged, through its subsidiaries and affiliates, in providing software consulting services, developing proprietary software products and providing computer-based solutions.

Except for the historical information contained herein, the matters discussed in this news release include forward-looking statements that may involve a number of risks and uncertainties. Actual results may vary significantly based upon a number of factors including, but not limited to, risks in product and technology development, market acceptance of new products and continuing product demand, the impact of competitive products and pricing, changing economic conditions, both here and abroad, release and sales of new products by strategic resellers and customers and other risk factors detailed in the company's most recent annual report and other filings with the Securities and Exchange Commission.