Salesforce Steals CRM Leadership From SAP: Gartner

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The laurels slip from SAP’s grip in the worldwide CRM market but it still retains its European crown

Salesforce has zoomed past SAP to take the lead in the customer relationship management (CRM) worldwide market, according to a Gartner report.

The Market Share Analysis: Customer Relationship Management Software, Worldwide, 2012 study shows that Salesforce experienced a growth in revenue by 26 percent, compared to just 0.1 percent for SAP. The top five CRM vendors accounted for nearly half of the market revenue, with Salesforce holding 14 percent, SAP accounting for 12.9 percent, and third placed Oracle with 11.1 percent.

Healthy growth

Joanne Correia, a Gartner vice president, pointed out that overall market growth in 2012, was three times the average for all enterprise software: “highlighting how CRM is at the height of the Nexus of Forces storm”.

Part of the reason for SAP’s poor showing last year was not only the depressed state of the European market, but also the fact that Gartner figures are calculated in US dollars, so the situation was exacerbated by unfavourable exchange rates due to a weakened Euro. Although SAP was not the worldwide leader, it was still the largest vendor in terms of revenue in Western and Eastern Europe.

Although North America and Western Europe dominate the CRM market, accounting for more than 80 percent of total software revenue, substantial growth was noted in the Eastern Europe, Eurasia, and Middle East and Africa regions. Overall, there was particularly strong demand for software as a service (SaaS) which took 40 percent of total software revenue for CRM in 2012. Correia put this down to organisations seeking easier-to-deploy alternatives to replace legacy systems or to provide alternative complementary departmental services.

The attraction of SaaS products has been enhanced by the expansion of features and functionality, often through acquisition, she said. The wave of consolidation activity that began flowing through the market in 2009 is still evident, with more than 50 acquisitions in 2012. This has increased competition at the top end of the market and a growth in global sales teams’ successes through increased marketing activity.

Acquisitions by IBM, Microsoft and Oracle have led to this bigger push for customers with the main highlighted target areas being analytics and multichannel support for social and mobile technologies.

“With corporate cash at all-time highs, many vendors are willing to pay high premiums to acquire specific technologies and expertise in an increasingly dynamic and competitive CRM market environment,” said Correia.

The report will form the basis of a discussion on CRM at the Gartner Customer Strategies & Technologies Summit 2013, to be held in London on 5-6 June.


Author: Eric Doyle
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