The first of many?

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I suppose it’s going to come as no surprise to anyone that AMR Research have reported that the CRM market has just ‘enjoyed’ its first year of negative growth. The bloodletting that’s gone on over the past year or so and the red ink stains all over the corporate balance sheets would have alerted us to that anyway.

It continued last week with Siebel, e.piphany and SAP all getting underway with varying degrees of restructuring to improve their financial positions. The shadow that the Oracle/PeopleSoft battle royal has cast over the industry these past two months has distracted attention somewhat from the fact that there are a lot of tough decisions being taken out there at the moment.

It’s interesting to note the companies that AMR is picking out for success. Despite its recent stalling, SAP is still seen as a major contender in the CRM space and a genuine threat to the market dominance of Siebel, while Microsoft’s clear and present danger to the rest of the established vendors is once again reiterated. Anyone who hasn’t woken up to Microsoft’s very real ambitions in this market must be in a coma, never mind a deep sleep!

The AMR report does leave some room for cautious optimism. It does predict that overall the CRM software market will grow from just under $10 billion this year to $14.5 billion in 2007, so maybe if we all hang on in there things will get better in their own good time.

But where the CRM market goes from here remains to be seen. There’s a real feeling among the vendor community at the moment that the sector has reached one of those nexus points where no-one is entirely clear how things will finally shake-out. For once the fear, uncertainty and doubt isn’t being generated by the marketeers, but by events in the industry itself.

For the customer trying to make buying decisions amid all this uncertainty, the pressures are greater than ever before. Now is the time to take as much advice as possible before making any purchases. This in turn of course will slow down already lethargic buying cycles even more, impacting again on bottom lines for vendors.

It may be the CRM market’s first year of negative growth; I wouldn’t like to predict that it will be its last.

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01st Aug 2003 10:06

Why is CRM about SAP, Siebel, PeopleSoft and the like? There seems to be a notion that being smarter with what we do in our business is about deploying such expensive and often not even fit-for-purpose technology. Its like buying a TV that comes with a remote with 30 buttons, of which we really only use 5.

Could it be that organisations are finally looking into itself and taking some steps back to understand what it is that it needs to be doing at the basic level - reviewing people competencies, processes and cleaning house in general - all with a view of improving Customer Relationships and Service Experience with realisation that technology is not the THE answer.

A downturn in the 'CRM Market' so to speak does not mean that the appetite for companies to improve Customer Relationships and Service Experience is also on a decline. I would've thought that this era is as good as any to get things right and appreciate the cardinal rule: "the first rule of being in business is to stay in business".

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By admin
31st Jul 2003 16:26

In our City, small businesses rule. Who cares about e.piphany, Siebel and SAP...no-one can afford that anyway. Small businesses need CRM and a good portion of them are starting to realize that. Sure, it takes some creativity to meet their objectives with thier limited budgets but we have found the way to do this and expect to enjoy significant revenue opportunities and growth this coming year. Sorry about the bad news for the guys who have made millions during the glory.

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avatar
01st Aug 2003 10:06

Why is CRM about SAP, Siebel, PeopleSoft and the like? There seems to be a notion that being smarter with what we do in our business is about deploying such expensive and often not even fit-for-purpose technology. Its like buying a TV that comes with a remote with 30 buttons, of which we really only use 5.

Could it be that organisations are finally looking into itself and taking some steps back to understand what it is that it needs to be doing at the basic level - reviewing people competencies, processes and cleaning house in general - all with a view of improving Customer Relationships and Service Experience with realisation that technology is not the THE answer.

A downturn in the 'CRM Market' so to speak does not mean that the appetite for companies to improve Customer Relationships and Service Experience is also on a decline. I would've thought that this era is as good as any to get things right and appreciate the cardinal rule: "the first rule of being in business is to stay in business".

Thanks (0)