The customer-relationship management (CRM) services market in Europe continues to undergo robust growth, despite the influences of the turbulent economic environment. IDC believes that demand for CRM services will continue, although the complexity and maturity of the market will require new forms of approaches and delivery models. The need for external service providers will grow as organizations realize the depth and complexity of integrating fully-fledged eCRM solutions at an enterprisewide and collaborative level.
The European CRM Services Market
IDC defines CRM services as consulting, implementation, operations management, support and training services that help clients expand, retain, improve or leverage relationships with customers to generate more business benefits. These services include both traditional and Internet-enabled tools and devices for such CRM segments as customer interaction, sales automation, marketing automation, field service/support, customer knowledge management/customer data integration. Using heritage as a guideline, IDC groups CRM service firms into the following seven categories: management consultants, technology owners, telecom providers, system integrators, CRM outsourcing, training providers and emerging players.
Market Trends, 2000-2001
IDC believes that for the past two years CRM has largely been focused on the deployment of point (standalone) solutions. Recently, CRM solution providers have developed Web-enabled applications or Internet architected solutions. These Internet-based offerings continue to emerge, placing pressure on traditional client/server architected solutions. Increasingly, many organizations include Web-enabling CRM as part of their overall CRM engagement. Additionally, the market is witnessing the emergence of a new breed of service providers, which IDC refers to as xSPs. In the past, SMEs that have often been hindered by a lack of capital investments or staff with CRM skills have been at a disadvantage in terms of executing effective CRM strategies. This is becoming an attractive option and an area that needs to be watched closely.
Market Predictions, 2000-2005
IDC predicts that wide-scale, corporate adoption of wireless devices is expected to increase within the next 12 to 18 months. Wireless capabilities and the promise of pervasive computing are expected to drive the growth of the market both in the consumer and corporate spaces. The birth of new business integrators vs systems integrators focused on the deployment of wireless CRM capabilities will become more pervasive within the next 12 to 24 months. Building and retaining customer loyalty will be challenged through these channels. IDC also predicts that over the next five-year period, as emarketplaces establish ground in Europe, a number of services will emerge in particular to answer the need for marketing services that encompass a broad array of CRM analytical capabilities. IDC believes that storage resources are becoming recognized as a primary asset as Internet-solutions such as CRM require rapid access to large amounts of data. Organizations will be more inclined to outsource to storage service providers for the provision of data management and storage.
The European CRM Services Market Outlook
The demand for CRM services in Europe was $13.2 billion in 2000 and is expected to grow to $43 billion by 2005, rising at a CAGR of 27% over the five-year period.
IDC believes that eCRM services in Europe will represent 57% of the total European CRM services market by 2005.
European CRM Services Competitive Landscape
The CRM services market in Europe is primarily dominated by international players offering a broad portfolio of services. The top 10 listing includes both international and local CRM services players.
Conclusion and Recommendations
IDC believes that several important messages that are essential to the success for CRM service firms can be drawn from the data in the forecast. The following are IDC's top three messages:
This report European CRM Services Forecast & Analysis, 2000-2005 (Report PR01H) provides a comprehensive overview of the Western European customer-relationship management (CRM) services market. Specifically, this report examines spending for each of the 16 individual countries as well as by industry. It also includes a forecast for the market from 2000 through to the year 2005, including a split for total CRM services, eCRM services and related key trends evolving in the European CRM services market.
To purchase this report, contact Katja Schmalen at 069/90502-115 or at kschmalen@idc.com
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