CRM licence revenues collapsed in 2002 on the back of a slow economy and global uncertainty.
New licence revenue for worldwide CRM software totaled $2.8 billion in 2002, a 24.7 per cent slide from a 2001 revenue of $3.7 billion, according to Gartner Group. "Smaller deals, tactical projects, longer sales cycles, and heavy competition have caused CRM vendors to struggle," Gartner analyst Tom Topolinski. "The slow economy, combined with buyer behavioral changes and priorities, have had a huge impact on sales of new license revenue for the CRM software vendors.?
Siebel still had the top slot based on worldwide new licence revenue for CRM software, with a 24.9 per cent market share. But the company, buffeted by financial concerns, saw its market share slip more than 3 per cent in 2002. SAP and PeopleSoft were the only top-tier vendors to experience a gain in market share in 2002, up 5 per cent and 0.4 per cent respectively.
All regions of the world experienced a decline in new licence CRM software revenue in 2002. The US declined 27.6 per cent, while Western Europe dropped 22.4 per cent and Asia/Pacific a 15.2 per cent decline.