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Report: CRM Services Industry To Reach $19.9B by End of 2000

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Posted December 20, 2000 By Staff     Feedback

This is an increase of 28% over 1999 and spending on CRM initiatives is expected to double in the next 12 months, according to Gartner Dataquest.

SAN JOSE, CA--As more companies set up Web-enabled systems to interact with their customers, CRM services have become more important. This, according to Dataquest Inc., a division of the Gartner Group.

Dataquest sees the CRM services market reaching $19.9 billion dollars by the end of 2000. That would be an increase of 28% over last year's revenue. Also, Dataquest says the average budget for CRM initiatives has reached $1 million and that's expected to double over the next 12 months.

"The CRM services market is being driven by increased penetration of the Internet as a technology platform, growing importance of CRM as a strategic initiative, the growth in e-commerce driving the use of Web channels for CRM, and the growing need for scalable customer management solutions," said Debashish Sinha, senior analyst for Gartner Dataquest's IT Services worldwide group.

Gartner Dataquest's analysts say there is a lack of expertise in the CRM market and that this has been a hindrance despite the great market of opportunities.

"As this market grows, the resource constraints will begin to show in implementation services, as well as the enterprise's ability to handle the increasing volume of customer interaction," Mr. Sinha said. "Although Web-based self-service may take up some of the overflows, we believe that access to a global workforce for handling the increased interaction flows of successful CRM implementations will become a service component provided by the CRM service providers."

More information is available in Gartner's report, "CRM Services Market Trends and Demand Characteristics for 2000." The report is available for purchase at 800-419-DATA, or 408-468-8009.

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