The Global CRM Market Continues its Growth Streak
Date: Thursday , August 06, 2009
The Customer Relationship Management (CRM) market continues to weather the economic storm as it has generated growth for a fifth consecutive year. The CRM market across the world generated revenue of $9.15 billion in 2008, a 12.5 percent increase from the $8.13 billion revenue of 2007, reports Gartner, an information technology research and advisory company.
The report, “Dataquest Insight: CRM Software Market Share Analysis, Worldwide 2008,” reports that the growth is lower than 2007’s 23.1 percent explosion. However, as Sharon Mertz, Research Director, Gartner says, “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 sub-segments.”
Software as a Service (SaaS), analytics, and customer retention technologies continued to drive the market forward, with Saas representing nearly 20 percent of total CRM software market revenue in 2008, up from over 15 percent in 2007. Interest in social networking and social software also escalated in 2008 as businesses were confronted with the sales, marketing, and serviceability impact of increasing consumer participation in online forums.
SAP continued to be the market leader accounting for 22.5 percent (although down from its 2007 share of 25.5 percent) of worldwide CRM software revenue in 2008, followed by Oracle and Salesforce.com with 16.1 and 10.6 percent respectively. Microsoft recorded a good growth accounting for 6.4 percent, followed by Amdocs with 4.9 percent.
While the CRM market remains highly concentrated in western economies, emerging markets are growing rapidly and now collectively account for nearly 16 percent of the worldwide market, up from approximately 13.8 percent in 2006. Gartner states that the Indian CRM market size is about 15 percent of the overall APAC market. Between 2008 and 2013, CRM in India is expected to grow at a CAGR of 12 percent. In fact the research firm has predicted that Indian CRM market may reach $80.3 million in 2009.
Gartner also observed that most vendors remain cautiously optimistic over the continued growth of the worldwide CRM market. Mertz says, “Investment in technologies, which enhance productivity, provide better visibility and insight into customer behaviors and growing online commerce. Sales and marketing activities are expected to grow through 2010.”
But will there be a saturation point in this growth? “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,” says Mertz.