CRM to expand in 2003
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The growth of the customer relationship management (CRM) market in 2003 will only be moderate, according to analysis group Giga. But competition between vendors will become fiercer, much sooner than expected, it argues.
After a number of years of substantial annual revenue growth, demand for customer relationship management systems in Europe will only grow moderately in 2003, according to analysis company Giga Information Group. But competition between vendors will become fiercer, much sooner than expected, it argues.
In Europe, growth will be between 5% and 10%, increasing to between 10% and 15% until 2005 when the market will be worth $2.3 billion. "Many top managers are sceptical or even opposed to CRM," says Richard Peynot, senior adviser, research agenda at Giga. "Past difficulties with CRM projects frightened many of them, tempting them to postpone large CRM projects or, more often, divide them in smaller sub-projects. At the same time, European companies are becoming more mature in their approach to CRM challenges, and CRM remains a high priority."
Peynot predicts that the highest priority projects will be front-office CRM suite implementations, infrastructure and technical foundations for CRM integration, marketing analytics, and integrating CRM with back-office applications. Unified multi-channel contact centres and customer data quality and consolidation will also become higher priorities in 2003.
The trend to smaller projects means that leading application vendors are now planning to extend their range from the top end of the market to the mid-market. At the same time, mid-market vendors are looking to expand into the high end as the market consolidates. "Local European vendors that do not continue to extend themselves beyond traditional borders risk disappearing, mid-range North American vendors that do not expand rapidly will leave Europe, and leading application vendors will minimise Siebel's CRM leadership," Peynot believes.
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