Here are several excerpts from an article by Thomas Wailgum, The Future State of the CRM Market:
The AMR report, “The Customer Management Market Sizing Report, 2007-2012,” details the comeback that CRM systems (or what AMR calls “customer management” software) have made of late.
Here’s what the analysts think will be the major drivers of growth during the next four years and what are the potential inhibitors to continued CRM expansion…
What Will Drive CRM Growth
CRM systems have grown up a lot since the late 1990s. And customers have come to expect a high level of technology-based customer service in 2008. That trend will only increase.
“An almost universal trend around customer-centricity and customer experience management will fuel continued customer management investments regardless of economic conditions,” write the AMR analysts. Those organizations that “streamlined operational and supply chain efficiencies through the last economic downturn, leaving the
customer experience as the most important potential competitive weapon,” will drive even more investment in CRM systems.As to corporate funding, the analysts write that while some customer management projects have been delayed briefly, few have been cancelled outright. “Some application categories, such as marketing analytics, become even more critical in more challenging economy as insights into customer behavior provide better visibility into future demand and the effect of promotions and campaigns,” states the report.
In addition, marketing organizations “are feeling more pressure from executives to demonstrate better insight into return on marketing investment,” the analysts write. “Today’s marketer needs to rely more on technology to aggregate demand data, analyze customer behavior and close the loop on campaigns. Marketing automation categories, such as campaign management and marketing analytics, will help support continued growth for the overall customer management market.”
What Will Inhibit CRM Growth
A disturbing trend that the AMR analysts note is that “CRM failure rates remain high,” they write. “Although vendors are improving user interfaces and technologies to combat this problem, it only puts a bandage on the situation.”
To fix the problem, customer management vendors “need to find ways to build more carrots into their tools to create sustainably high adoption rates,” states the report. “If success rates don’t improve and total cost of ownership doesn’t come down, buyers will find CRM investments harder to justify, especially if budgets begin to shrink.”
