$2bn market for CRM in SMBs: Datamonitor

16 December 2004

Mumbai: A new report by independent market analyst Datamonitor (DTM.L), reveals small to medium sized businesses (SMBs) are expected to become the next big growth engine and revenue generator for CRM vendors yielding revenues of around $2 billion by 2008 — more than double the value of that today. Vendors who had ignored SMBs (companies with headcount of 1-1,000) as potential users of customer relationship management (CRM) in the initial 'CRM rush' of the late 1990's are now looking at them in a more positive light.

SMB CRM spending in Europe Middle East and Africa (EMEA), the largest market globally, is expected to be in excess of a $600 million market in 2008 — nearly double those revenues in 2004. In the Asia-Pacific region (APAC), it is estimated to exceed $500 million in 2008, approximately double that of today.

The report, CRM for small to medium businesses, highlights the huge potential this previously un-tapped market possesses. Datamonitor expects global SMB CRM application spend will total close to $2 billion by 2008 - more than double the value of that today. EMEA, the largest market globally, is expected to be in excess of a $600 million market in 2008 — nearly double those revenues in 2004. In the Asia-Pacific region, SMB CRM spend is estimated to exceed $500 million in 2008, approximately double that of today.

SMBs to provide a growing share of global CRM revenues
Today, with a saturated enterprise CRM market, vendors are looking to new markets to compensate for slowing sales. According to Datamonitor, the clear answer lies in smaller companies previously overlooked. Numerous, and often with as much appetite for CRM as their larger counterparts.

Smaller companies are faced with many problems faced by large companies' enterprises. These include difficulties in the field of sales, marketing and service. Availability, revenue generation, customer service and channel management are four primary reasons driving increased CRM solutions amongst SMBs globally, says Datamonitor.