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02.26.09 Gartner Examines Future Of CRM  By Mike Sachoff The business goals and challenges of customer relationship management (CRM) programs will remain the same today as they were 10 years ago, and they will continue to be the most important during the next 10 years, according to Gartner. "CRM remains a major focus for business executives, because the goals of acquiring, developing and retaining customers in a profitable manner are timeless," said Ed Thompson, vice president and distinguished analyst at Gartner. CRM application pricing has changed significantly during the past 10 years, with organizations commonly paying $1,000 to 1,500 per licensed user in 2009 compared with over $3,000 at its peak in 2000. The most common pricing model is still per user, but process-based pricing, driven by service-oriented architecture (SOA) and software as a service (SaaS) will become the norm by 2020, up from less than 1 percent of the time in 2009. The shift to SaaS will see close to 50 percent of all field sales applications be delivered this way by 2012, compared with less than 1 percent in 2000. However, the percentage of all CRM applications delivered via SaaS will be only 25 percent in 2012, and 40 percent in 2020. As competition for SaaS increases, pricing will drop from $800 per user per year in 2009 to near $500 by 2020.
The global CRM application software market grew at a rate of nearly 90 percent in 2000 then collapsed in 2001 bottoming out in late 2003. Since 2004, the market has grown steadily, at 11 percent to 23 percent per year. Gartner estimates that the total revenue for CRM application software market in 2008 amounted to nearly $9 billion worldwide and will hit $10 billion in 2009, a 7 percent year-on-year increase. The five largest CRM application vendors are estimated to represent almost 60 per cent of the market in 2008. Gartner estimates that three or four large vendors will remain with an aggregate of more than 50 per cent market share in 2020. "Instead of trying to build everything, these large vendors will provide a set of core CRM services and processes, and will act as platforms for software and service partners that are willing to build the requirements needed by smaller industries and specific functional niches of the market. We recommend organizations to reduce the number of CRM applications by 10 per cent per year through 2020," said Mr. Thompson. About the Author: Mike is a staff writer for WebProNews. Visit WebProNews for the latest ebusiness news. |
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