Organizations are leveraging customer relationship management (CRM) technologies as a major part of their digital initiatives to enhance the customer experience, according to Gartner, Inc. [www.gartner.com] That demand for modern technology customer relationships is driving refreshed or expanded integration and usage of all areas of CRM software. The outlook continues to be positive for CRM as buyers focus on technologies that enable more-targeted customer interactions in multichannel environments.
"CRM will be at the heart of digital initiatives in coming years. This is one technology area that will definitely get funding as digital business is crucial to remaining competitive," says Joanne Correia, research vice president at Gartner. "Hot areas for CRM investment include mobility, social media and technologies, web analytics, and ecommerce."
Gartner expects CRM market growth to stay moderate in 2014, following three strong years of investment. CRM software revenue is forecast to reach $23.9 billion in 2014, with cloud revenue accounting for 49%. SaaS- or cloud-based CRM deployments currently represent more than 40% of all CRM deployments, and look set to reach 50% during 2015.
"Unsurprisingly, high-tech, banking, insurance, securities, telecommunications, pharmaceutical, consumer goods, IT manufacturing, and IT services vertical industries will continue to be the largest spenders on CRM as they have the widest use of different types of CRM applications and technologies," says Ed Thompson, vice president and distinguished analyst at Gartner. “All these industries are also increasing investment in emerging economies, further driving spend."
Customer support and service (CSS) has IT leaders, vice president,s and directors of customer service involved in customer support/relationship initiatives and are looking at the targeted use of big data analytics, peer-to-peer communities, and the evolving customer engagement center (CEC), which is the next generation of the customer service contact center, for critical processes and technologies. A central focus of the CSS organization is on how to engineer consistent, differentiated, cross-channel customer experiences, while supporting the need for increased use of customer self-service.
Ecommerce is top of mind for CEOs, chief marketing officers (CMOs), and senior executives as they seek the ability to improve overall customer experience, profitability, and sales. At the same time, marketing technology is a hot area for IT investment, but solution decisions are increasingly being driven by CMOs and the marketing organization, with little to no IT involvement. CIOs will need to work more closely with CMOs and marketing leaders to adapt to the increasing technology demands emanating across the marketing organization. Mounting pressure on CMOs to drive growth, improve accountability, and reduce costs is pushing marketing organizations to make significant marketing technology investments across a broad set of applications and functionality.
The main drivers behind the hot topics in CRM—cloud, social, mobile, and big data—are being joined by a fifth driver: the Internet of Things, where sensors connecting things to the internet create new services previously not thought of.
Social—In the sales, marketing, and customer-service departments, marketing is being forced to monitor, communicate, and engage in social commerce business with several hundred public social networks. Customer service has to respond to tweets and Facebook and LinkedIn discussions, as new service channels and sales are now using social media as a source of new leads and intelligence on prospects.
Mobile—Smartphones, tablets, and mobile apps are forcing change at an even faster rate than social networks. Connections to the internet via smartphones will exceed PC users by the end of 2014 and smartphones have already overtaken PCs as the most common tool for accessing social networks in most countries. Bring your own device (BYOD) policies are springing up around the globe as IT departments are forced to support a proliferation of devices. It is tablets, however, that are causing the most disruption as sales departments and board directors purchase them and then demand support.
Big Data—The marketing department has been most impacted by the explosion in customer information available to businesses during the past five years. Predictive analytic models for churn analysis, product and service recommendations direct to the customer, and/or sales prompts for salespeople are all becoming more sophisticated. Thus, the data is available and the tools are emerging, but the problem is the lack of skills and resources to use the tools.
Cloud—This driver is a decade old now in CRM, having started back in the late 1990s with the rise of application service providers. In many ways, the low-hanging fruit for cloud adoption has already been picked. The remaining areas of CRM application functionality will be ever harder to adopt in a cloud-delivery model, so the switch to cloud will steadily slow.
Internet of Things—As cars, buildings, bodies, and chairs are connected to the internet and as the price of sensors and communications drops down toward $1, the automotive, construction, healthcare, and hospitality industries, among many others, will be transformed. At the forefront of this shift will be sales, marketing, and customer service departments in promoting, selling, and supporting the new services.
"These drivers are spurring a critical need for more traditional operational CRM as CRM continues to top software investment priorities. This further validates businesses' focus on enhancing customer experience and consistent investment in CRM software, especially in CSS, marketing, and sales software," says Correia.
- Fraud Attempts Up 41% in 2021, Report Shows
- Scams are soaring. What should financial institutions do to better protect themselves and their customers?
- Opposition to Digital Dollar Grows as ABA Rejects Idea
- Wells Fargo Advisors Fined $7M over AML Failings
- OCC’s Hsu Warns on Risks Despite Sector Strength