Customer Relationship Management Market Analysis Report By Solution, By Deployment, By Enterprise Size, By End Use, By Region And Segment Forecasts From 2020 To 2027

Industry Insights

The global customer relationship management (CRM) market size was valued at USD 40.2 billion, in 2019, and projected to grow with a CAGR of 14.2% over the forecast period, from 2020 to 2027.  Factors such as increasing adoption of digital operations, the improved customer experienced and automated engagement are fueling the demand for CRM solutions across several industries. Availability of various services models like Infrastructure as a Service (IaaS), Platform as a Service (PaaS), SaaS, and the advent of cloud-based technology is projected to drive the market growth in the next few years.

According to a survey conducted by Soft Cloud, almost 82% of enterprises are using CRM solutions for sales process automation and sales reporting. Large companies are looking for actionable insights, customer data on unstructured datasets as well as effective tools to handle them. Therefore, the shift of companies from push to pull marketing and effort to deliver better content would drive the market growth.

Moreover, social CRM is expected to gain traction due to changing customer dynamics. Salesforce.com reported that over 60% of GDP will depend on digitalization due to the increasing shift of every industry towards digitally enhanced offerings, customer relationships, and operations. In addition, increasing demand for communication technology in the IT sector, automated customer conversations, robotic process automation, and mobile CRM will boost the demand for CRM solutions.

Lack of incorporating CRM software and manual data entry are major challenges faced by several enterprises. Therefore, CRM solution deployment as a separate unit may hamper the adoption of CRM solutions. However, pre-emptive planning for CRM installation will curb the installation problem. In addition, technological advancements like business intelligence, embedded analytics, and its integration with CRM solutions will fuel market growth.

Solution Insights

On the basis of the solution, the market is fragmented into customer service, salesforce automation, customer experience management, CRM analytics, social media monitoring, marketing automation, and other solutions.  The customer experience management category is expected to dominate the market due to increasing companies' shift towards digitalization for marketing. Moreover, increasing demand for real-time and fast services among several industries is anticipated to help to retain its dominance in this market. Many firms across several industries such as retail, IT, and telecom are focusing on building customer loyalty as well as long-term retention.

On the other hand, CRM analytics is projected to witness a considerable growth rate. The growing emergence of business intelligence, analytics, and big data are boosting the demand for CRM software. Further, the rising accumulation of structured and unstructured data due to increasing usage of digital channels will propel the segment growth.

Deployment Type Insights

On the basis of deployment, the market is segmented into cloud deployment and on-premise. Cloud-based CRM solution is gaining traction, as it helps small and large organizations to increase sales. The demand for SaaS is increasing in small and large enterprises, as it offers several advantages such as mobility, cost flexibility along no hardware cost. Increasing concerns regarding privacy and security are major factors estimated to hamper cloud deployment.

According to the survey conducted by Select Hub for CRM buyers, the majority of enterprises prefer cloud deployment to on-premise, wherein around 43% of enterprises prefer on-premise deployment. This is due to the presence of a large number of IT resources and staff, which enables them to handle the complex infrastructure of on-premises CRM. Moreover, buyers prefer to invest in a CRM system that consists of new features that are expected to replace the existing system. Therefore, competitive upgrades and replacements are expected to influence various enterprises to deploy new CRM solutions during the forecast period.

Enterprise Size

Based on enterprise size, the market is fragmented into Small and Medium Enterprises (SMEs) and large enterprises. CRM solutions are majorly adopted by large enterprises, as it helps to improve sales efficiency and help the organization to track return on investment (RoI). Therefore, large enterprises are expected to hold the largest market share due to high IT budgets and a growing need to handle a huge amount of data. Moreover, the increasing application of big data integrated with AI and aided by machine learning is expected to drive the market growth in this segment.

According to Finances Online, by implementing CRM solutions, the RoI ranges from USD 2.5 to USD 5.6 for a dollar spent. As per the surveyor’s records, companies that are offering consultancy and training services to IT professionals attained a RoI of 1,556% within 3 years after switching to a new CRM solution. Such high returns due to the CRM solution are expected to boost the demand in SMEs.

End-use Insights

On the basis of end-use, the CRM market is segmented into IT &Telecom, discrete manufacturing, government, education, retail, healthcare, BFSI, and others. It has been observed that B2B businesses are the major users of CRM solutions, wherein the demand for these solutions is relatedly high in B2C businesses. Therefore, BFSI and the retail sector are the largest shareholders in this market. Other than these industries, CRM solution providers are also offering solutions in horizontal markets such as integration, IoT, analytics, and others.

IT & telecom segment is expected to exhibit with fastest CAGR during the forecast period. Customer relationship management in the telecom sector offers customer exclusivity, support, post-purchase service, brand equity, and distribution channels. Moreover, digital transformation and the growing adoption of customer-centric processes are boosting the adoption of CRM solutions in the IT and telecom sectors.

The discrete manufacturing segment is expected to witness significant growth due to its various features including precision of competitors, customer buying psychology, and reduced the complexity of the sector.

Regional Insights

In 2019, North America led the global CRM market due to the presence of various solution providers both small and big, especially in the U.S. While North America is expected to retain its position over the forecast period, Europe is projected to witness sluggish growth. This is due to slow economic growth and growing public depth that have negatively affected the IT budgets of organizations in Europe.

Asia Pacific is projected to exhibit the fastest CAGR from 2020 to 2027. This growth is attributed to the growing demand for CRM solutions from developing countries such as India and China. In these nations, the growth of the e-commerce industry is expected to propel market growth in the Asia Pacific. Factors such as increasing business scope, an optimistic growth prediction, and a large customer base are major factors anticipate to drive regional market growth. For example, in 2019, Salesforce.com increased its operations by investing in Japanese startups worth USD 100 billion.

Impact of COVID-19

The recent outbreak of COVID-19 has urged the organizations to take some necessary initiatives to ensure the safety of the community and employees. Due to the following mandate of work from home, the need for collaboration has been increased for the companies to interact with their clients, which is expected to drive the CRM solution demand to maintain the customer base.

In this pandemic situation, organizations are widely adopting CRM to pursue sales, increase productivity, and serve customers. In March 2020, a cloud computing company, Veeva Systems Inc. experience 10 times more usage of CRM solutions in the healthcare sector. In addition, Zoom Video Communications Inc. has also observed an increase in customers alongside various companies Slack Technologies Inc. and Microsoft Corporation, thereby, increasing the value of leveraging technology including CRM is expected to drive the market growth during the pandemic period.

Customer Relationship Management Market Share Insights

The market for customer relationship management is majorly dominated by five market players, namely Adobe, Microsoft, SAP, Salesforce.com, and Oracle. Salesforce.com. is one of the major players in this market, as this company offers cloud-based CRM suits that provide elemental functionalities to small and large enterprises. In the last couple of years, Microsoft has also observed significant growth. The market is also marked by various merger & acquisition activities of small companies by large firms in the market.

In 2019, Amazon Web Services, Inc. (AWS) and Salesforce have entered into a strategic partnership. In this partnership, Salesforce aims to integrate its cloud voice service with Amazon connect in order to minimize call resolution time and helps the organization to run operations smoothly along with superior customer service. The deployment of voice and AI technologies will strengthen the market position of Salesforce.com in the next few years.

Report Scope

Segments Covered in the Report

This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2027. For the purpose of this study, Million Insights has segmented the global customer relationship management market report based on solution, deployment, enterprise size, end-use, and region:

• Solution Outlook (Revenue, USD Billion, 2016 - 2027)
    • Customer Service
    • Customer Experience Management
    • CRM Analytics
    • Marketing Automation
    • Salesforce Automation
    • Social Media Monitoring
    • Others

• Deployment Outlook (Revenue, USD Billion, 2019 - 2027)
    • Cloud
    • On-premise

• Enterprise Size Outlook (Revenue, USD Billion, 2016 - 2027)
    • Large Enterprise
    • Small & Medium Enterprise (SME)

• End-Use Outlook (Revenue, USD Billion, 2016 - 2027)
    • BFSI
    • Retail
    • Healthcare
    • IT & Telecom
    • Discrete Manufacturing
    • Government & Education
    • Others

• Regional Outlook (Revenue, USD Billion, 2016 - 2027)
    • North America
        • U.S.
        • Canada
    • Europe
        • U.K.
        • Germany
    • the Asia Pacific
        • China
        • India
        • Japan
    • Latin America
        • Brazil
    • Middle East & Africa