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08.04.09 Global CRM Market Up 12.5% In 2008  By Mike SachoffThe global CRM market revenue reached $9.15 billion in 2008, a 12.5 percent increase from 2007 revenue of $8.13 billion, according to Gartner. Analysts said the market growth was driven by enterprise investments in technologies focused on customer retention, analytics and on-demand solutions. "Despite financial market volatility, the worldwide CRM market enjoyed its fifth consecutive year of double-digit growth as businesses continued to invest in solutions across all subsegments," said Sharon Mertz, research director at Gartner. "Actual market growth was moderated by a stronger dollar but reflects higher contributions from emerging markets." Software as a Service (SaaS) continued to drive the market forward, accounting for nearly 20 percent of the total CRM software market revenue in 2008, up from just over 15 percent in 2007. Interest in social networking and social software also increased in 2008 as businesses were confronted with the sales, marketing, and serviceability impact of increasing consumer participation in online forums. SAP remained the market leader accounting for 22.5 percent of worldwide CRM software revenue in 2008, but this is down slightly from a 25.5 percent share in 2007. Microsoft saw the strongest growth rate among the top 5 vendors as its revenue increased 75 percent in 2008.
While the CRM market remains highly concentrated in Western economies, emerging markets are growing rapidly and now account for nearly 16 percent of the global market, up from 13.8 percent in 2006. Both North America and Europe underperformed in terms of CRM market growth in 2008, but their market share remained high at 52.5 percent and 31.6 percent, respectively. Gartner said most vendors are cautiously optimistic for continued growth for the global CRM market. "Investments in technologies which enhance productivity, provide better visibility and insight into customer behaviors and grow online commerce, sales and marketing activities are expected to grow through 2010," said Ms. Mertz. "However, while we expect overall CRM growth prospects to remain positive in 2009 we do anticipate them declining to mid single-digits due to continued economic uncertainty." Ms. Mertz recommended the following strategies to drive customer value: - Aligning products, services and contractual agreements to enable customer business imperatives of higher client acquisition, retention and satisfaction. - Continuing to offer creative terms to maximize revenue potential and enable businesses to consumer critical products and services. - Extending application vertical-market functionality, whether by in-house development, acquisition or partnership agreements to take advantage of key verticals or government stimulus packages. - Focusing product offerings on applications and technologies that provide customers with tools and capabilities to increase visibility on customer requirements and behaviours. About the Author: Mike is a staff writer for WebProNews. Visit WebProNews for the latest ebusiness news. |
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