New Zealand companies spent $220M on CRM in 2018

New Zealand companies spent $220M on CRM in 2018

Salesforce, SAP, Oracle, Adobe and Microsoft make up top five vendors globally

New Zealand organisations spent $220 million on customer experience and relationship management (CRM) software in 2018, increasing 13.9 per cent according to analyst firm, Gartner. 

Globally, the market grew 15.6 per cent in 2018, topping US$48.2 billion, Gartner revealed.

CRM made up almost a quarter of enterprise application software revenue in 2018, which increased 12.5 per cent amounting to US$193.6 billion.

The top five vendors by revenue in 2018 accounted for more than 40 per cent of the total market, including Salesforce (19.5 per cent); SAP (8.3 per cent); Oracle (5.5 per cent); Adobe (5.1 per cent); Microsoft (2.7 per cent) while other vendors made up (58.8 per cent).

About 72.9 per cent of CRM spending was on software-as-a-service (SaaS) in 2018, which is expected to increase further in 2019 to 75 per cent. Gartner pointed out some of the biggest drivers in this space include agility, flexibility, as well as requirements for remote and mobile users.

Gartner senior analyst, Julian Poulter, said cloud growth dropped slightly in 2018, but still remains strong at 20 per cent, significantly higher than the overall growth rate for the market.

“As an early mover to the cloud, CRM software is probably seeing a gradual reduction in cloud growth rates due to high adoption,” Poulter said.

The analyst firm said all sub-segments of the CRM market grew by more than 13.7 per cent, with marketing emerging as the fastest growing segment, increasing by 18.8 per cent and representing more than 25 per cent of the entire CRM market. Customer service and support retained poll position, contributing 35.7 per cent of CRM market revenue.

“To exploit the significant market opportunity, product managers in CRM application providers should double down on cloud deployments and consider adding functionality in the fast growing marketing segment,” Poulter said.

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