Growth rate in the CRM market stabilises

Recently released research by analyst group Gartner shows that CRM software revenues in Europe rose to $1.9 billion in 2005, representing growth of 9.7%, the same as in the previous year. However, the pace varied markedly across Europe, with rates in different countries ranging from below zero to more than 27%.

There was also a big difference in demand for the three main strands of CRM. Sales of marketing automation software increased by 18.6%; revenues from sales automation applications were up 12.1%; and the customer service and support segment rose just 3.6%.

SAP took almost a third of the market, after growing by 13.5% during the year, while Siebel trailed behind with 16.1% of the pie. Third-placed Oracle suffered badly in the run up to its acquisition of Siebel. Its CRM revenues declined by 13.3% due to customer uncertainty regarding future product directions.

Other vendors may appear distant to these giants but they are quickly gaining ground. SAS Institute, in fourth position, recorded a 29.2% hike in CRM sales, taking its share to around 4%. And the fastest growing vendors overall in Europe were still in the 'others' category: Microsoft grew by 88.1% and by 86.4 %.

At a global level, the picture looked similar, although the global growth rate actually fell during 2005 from 15.1% to 13.7%.

Gartner predicts a high number of acquisitions in the next few years, estimating that one in three CRM software vendors will be involved in a merger or acquisition annually.


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Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

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