Gartner CRM Guide, 2014: More Than 50% of CRM Will Be Deployed As SaaS by 2015

3
1,622 views

Share on LinkedIn

It’s clear and evident! Gartner in its CRM Guide 2014 (published on March 10, 2014) has stated the rate at which CRM systems are expected to thrive within the next ten years. With more than 50% Of CRMs to get deployed As SaaS by 2015, you can say, the tipping point of on-premise versus SaaS-based CRM deployments will eventually arrive next year. And that’s not it – Gartner further anticipates “SaaS deployments of CRM to reach a maximum of 80% to 85% by 2025’’

Here are a few other key extracts from the report:

The CRM market growth will stay moderate in 2014, following three strong years of investment.

‘’The CRM software market is projected to grow at a 14.8% compound annual growth rate (CAGR) through 2017, with cloud revenue growing at more than 22.6% CAGR”.



Below cited is a graph depicting the comparison of market growth rates by CRM application category:

CRM Market growth

Please note: Gartner has included integrated marketing management (IMM) in the Marketing category.

Percentage of Worldwide CRM Revenue by Region, 2013 and 2017

While North America and Western Europe has been the largest regions for CRM, accounting for 80% of total software revenue in 2013, their revenue might decline by 1% in 2017.

Otherwise, most regions will experience double-digit growth rates for the next five years.

Latin America, Greater China and Asia-Pacific will have the highest CAGR for the next five-year period. Reason: These emerging regions have witnessed good growth rates even in an economic crisis. Customer service will dominate in the CRM application category by having the largest share in Greater China, Latin America and emerging Asia/Pacific countries.

Western Europe might have the lowest CAGR at 9.7%, due to the market’s mixed economy.

What are the possible factors that are accelerating this inflection point in CRM? (Particularly SaaS CRM)



Paraphrasing the comments of Louis Columbus Customers are responsible for this sudden proliferation of CRM systems. They are radically changing the landscape, making it difficult for most companies (including the BIG players) to cope up with it.

And in fact, it is the most challenging situation for the larger companies. The larger their operational horizon the harder it is to change the approach in dealing with prospects and customers.

Unlike the earlier times, customers’ expectations of responsiveness have become way too fast. Five to ten years before, doing away with legacy CRM system were okay (thanks to the non presence of mobile applications and social networks) but today – it’s all about making the service agile.

Sales teams cannot afford to take two week classes (and still make their quota) like many legacy CRM systems offered.  They have to be up and running on a new CRM application literally in hours or days to be effective.  It’s all about being quick enough to define new sales strategies, apply and measure them as an on-going process.

And this is precisely where SaaS CRM systems come in the picture. Designed with mobile deployment in mind, they emphasize upon streamlined, intuitive and user-customizable interfaces to help sales teams be more effective. 

And it’s just not about sales, but other teams too – marketing and customer service. Each of them primarily need a Cloud CRM system that not only is up and running in a few hours or days but gives the benefit of streamlined customer data on the move.

What is the bottom-line?

If you are using a CRM, your CRM should ideally be hosted in the cloud. And if you aren’t using a CRM, you are miles behind your competition!

Cloud CRM has definite advantages over its counterpart – the traditional model that requires setting the system up in an onsite datacenter. With more and more small and large enterprises realizing it, the need for Cloud based CRM system is only soaring high. And it will continue to do so even more in the coming years as customers’ expectations of responsiveness keeps increasing.

And in such a scenario, it will be nothing but deliberately putting the foot on the axe by not opting for a SaaS based CRM.



Paraphrasing the comments of Angus McFayden The move towards cloud based solutions is predominantly driven by cost effectiveness and the flexibility of those solutions. With cloud based CRM systems, businesses are able to deliver on their strategies a lot quicker than if they had to build their own CRM system. Not to forget, that they also remove the hassle of hosting and maintaining infrastructure in-house.

Apart from Salesforce, the leader in cloud CRM, there are many other crucial CRM players who have come on the horizon. Many renowned companies have been specializing in customizing cloud CRM solutions for their clients. If you are also one of those who dread of taking a ready-made CRM solution, contacting a CRM application Development Company for a customized cloud CRM solution will serve the purpose. 

3 COMMENTS

  1. I’ve been having some issues finding a decent caller ID solution to work with my CRM system until recently, and I figured I’d share some of my experience with anyone who might have run into a similar issue. Klink (www.klink.com) is pretty handy, especially for mobile professionals.

    It’s super functional and includes social media data for anyone who calls you. Plus it’s got the ability to identify millions of callers who aren’t in your address book or in your CRM database. It also has a feature that lets you update your CRM from within the app directly, which is pretty helpful especially if you’re away from your desk a lot of the time. It’s worked really well for me so far – I hope this is helpful for anyone else with a similar need!

  2. Hi Paul

    Show Me the Value!

    The movement towards CRM SaaS solutions is largely in response to the difficulties most Cos faced getting value out of their on-premise CRM solutions. My experience over 25 years implementing CRM solutions of all kinds suggests that only 10-20% of the total value available from a typical CRM implementation comes from the tool itself. The remaining 89-90% comes from building out the business capabilities required to get the most out of the new tool, from managing the organisational change the new tool requires and from building the new operating model the new tool should catalyse. SaaS will not significantly influence these value creating activities at all. In fact, most of the vendors refuse point blank to have anything to do with them, saying that getting value out of their solutions is a job for their SIs or for customers themselves.

    The real revolution in CRM solutions isn’t from switching to an on-premise solution to a SaaS one, but from providing Customer Management Processes as-a-Solution (CMPaaS) to end-users. Some SaaS implementations are starting to do this by building CRM Centres of Excellence that combine a mixture of CRMPaaS through a standard IT DevOps model to develop and operate the CRMPaaS and a Service Factory to use the low-value, low-variation customer management processes. It is this ability to get value more out of CRM implementations that will decide the winners and the losers in the future, not whether they are on-premise or SaaS implementations.

    Graham Hill
    @grahamhill

  3. Graham I liked your insight and thoughts how to maximize on CRM implementation for any business. It is imperative that Businesses spent some quality time defining their Processes while implementing their CRM of choice. I will still share the fact that Cloud initiative has allowed many SMBs to open up and try CRM for their business. It typically used to be a productivity tool only for Mid and Enterprise level businesses for primarily two reasons – i) High cost of implementation and customization ii) Ongoing support and maintenance cost. With the advent of Cloud CRM providers, these two items are hugely managed for a very low TCO and quick deployment cycle. IMHO, I feel Cloud CRM solutions have helped penetrate the market and define the need for a CRM in business but the fact still remains in utilizing the CRM properly to make it effective and more productive for the end client. We, at Converge Enterprise (www.convergeenterprise.com) have realized its potential and offer CMPaaS solution to each of our client to make sure they are able to atleast utilize 60% of the CRM functionality effectively.

LEAVE A REPLY

Please enter your comment!
Please enter your name here