Social CRM To Exceed $1 Billion By 2013

Gartner forecasts the CRM market to enter a three year shake up in 2011, as a number of key trends take hold, including exponential rise in Social CRM and SaaS becoming routine. It states that by 2015 one-third of spending on new CRM software will be SaaS. Further, the spending on Social Software to Support Sales, Marketing and Customer Service Processes will exceed $1 billion worldwide by 2013.

Gartner forecasts that Social CRM will encompass approximately 8 percent of all CRM spending in 2012, up from approximate 4 percent in 2010. On the other hand, CRM software delivered by SaaS will rise from 24 percent of the CRM software market in 2009 to 32 percent by 2015.

“Over the next three years, social CRM will continue its exponential rise, software as a service (SaaS) will become routine, salesforce.com will reshuffle the market order, and consultants and system integrators will sell their own CRM software,” said Ed Thompson, vice president and distinguished analyst at Gartner.

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Gartner further highlights that by 2015, all Tier 1 CRM External Service Providers (ESPs) will invest in their own bolt-on CRM application software. The majority of Tier 1 CRM ESPs are now investing in client-agnostic R&D that is not project-funded to build their own bolt-on or best-of-breed CRM application software to run on platforms such as Force.com and Microsoft’s xRM. However, it warns the buyers to watch for further declines in independent advice on the selection process from ESPs and take appropriate caution when evaluating ESP applications. It recommends the buyers to not let existing brand and reputation cloud their perceptions of the applications.

Gartner recommends that buyers of social CRM should take a three-step approach, which includes determining if there are any social CRM projects already under way; Calculating the likelihood that one will be forced to start something in 2011; Finding industry specific case studies that can provide examples of what is possible, and sharing them with other decision makers in the organisation.

It further recommends buyers of CRM applications to resist the temptation to bypass the IT organization in the short term and instead, involve IT in purchase decisions early on to avoid the most-frequently cited downstream issue of data integration, and to address potential concerns about inadequate security, scalability and privacy.