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The global customer relationship management market size was valued at USD 57.83 billion in 2021. The market is projected to grow from USD 63.91 billion in 2022 to USD 145.79 billion by 2029, exhibiting a CAGR of 12.5% during the forecast period. The global COVID-19 pandemic has been unprecedented and staggering, with experiencing lower-than-anticipated demand across all regions compared to pre-pandemic levels. Based on our analysis, the global customer relationship management market growth had exhibited a decline of 10.0% in 2020 as compared to 2019.
Customer Relationship Management software helps in managing, organizing and monitors business operations in order to increase customer satisfaction. The increasing use of advanced technologies such as Internet of Things (IoT), artificial intelligence, and big data is predicted to drive software demand. Also, owing to ease of access and integration, cloud-based CRM software is likely to gain traction. For instance,
Surging Remote Location-based Employees and Clients to Drive Growth amid COVID-19 Pandemic
The COVID-19 pandemic had a major impact on enterprises across the globe due to disruptions in production units, supply chains, labor and personnel availability, and the temporary closure of cross-country borders. As a result, organizations implemented work-from-home policies. Despite the shutdown, a vast number of businesses began operations from remote locations. However, businesses experienced a growing need for customer support solutions in order to facilitate seamless interaction between employees and customers.
CRM solutions provide significant real-time communication, supplementing and enhancing traditional relationships by phone and e-mail. By implementing CRM software, companies are reaching out to their clients by providing personalized customer services. During the pandemic, the software-assisted businesses in real-time tracking and automated solutions to improve the customer experience. Also, industries including BFSI, retail and consumer goods, and healthcare made extensive use of these technologies.
For instance, healthcare employees in the U.K., and U.S. used the Salesforce Health Cloud CRM system for online patient record-keeping. As a result, the customer relationship management is expected to grow significantly throughout pandemic.
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Integration of Artificial Intelligence to Propel Potential Market Trend
The implementation of artificial intelligence (AI) is growing fast across the globe. Similarly, the need for integrating AI with CRM systems is increasing in order to improve the customer experience. According to a research by IDC, Salesforce, Inc. AI-powered CRM system is used to provide users with a competitive advantage.
CRM software based on AI technology including deep learning, machine learning, and natural language processing help organizations in understanding the psychological state of the customer. Using this data, the software manages and delivers solutions to consumers, assisting in the development of strong connections with end users.
For instance, Zoho CRM's Zia and Salesforce's Einstein deliver AI-powered CRM that uses voice technology to gather customer information. Also, bots and virtual assistants use this technology to eliminate human mistakes and provide automated replies to customer reports, data collecting, emails, and other tasks. As a result, the incorporation of AI technology is likely to increase the market size in near future.
Rapid Digital Transformation to Drive Market Growth
The integration of emerging technologies across business domains to improve operations and value delivery to customers is expected to drive the demand for CRM solutions Also, companies are planning to implement business strategies and market trends, to expand their geographical presence. This strategy further helps organizations to offer a better customer experience after data analysis.
According to a survey report by PWC Experience Center, around half of the organizations stated that digital transformation aided in enhancing better customer experience. As a result, organizations are deploying a CRM system as part of their transition to customer-centric services.
Rapid digital transformation significantly relies on CRM and other integrated technologies that provide improved customer satisfaction. This seamless change enhances the end user’s journey by providing a superior customer experience across all communication touchpoints. As a result, in order to properly adopt digitalization, the need for CRM software is expected to rise, this will further help in driving the global market in near future.
Increasing Security Threats over CRM Stored Data May Hamper Growth
CRM software stores a vast quantity of personal and confidential data for both businesses and consumers. The system carries critical information including credit card information, patient health data, sales data, financial information, corporate intelligence, and banking instructions.
The safety and security of such critical data are major issues for organizations. Furthermore, governments across the nations are enacting stringent data rules, such as the General Data Protection Regulation (GDPR), and others, to protect customer information.
The increasing number of data breach incidents through CRM is causing a root problem for software providers. For instance, in November 2020, Microsoft Corporation partnered with C3.ai and Adobe Systems, Inc. to develop sophisticated, AI-powered CRM solutions. This upgraded offering is supposed to improve forecasting skills. Such product launches would help enterprises to forecast security threats and help in preventing data loss. Also, these AI-powered CRM solutions provide enhanced security and create a layer of protection to enterprise’s network.
Increasing Demand for Software among SMEs to Drive This Segment’s Growth
Based on the component, the market has been bifurcated into software and services.
The software is expected to dominate the market during the projection period. CRM software centralizes customer data management and, automates sales and marketing operations. The software has grown at an unprecedented rate among SMEs, owing mostly to the rising demand to manage customer experience and retain new customers.
The services are anticipated to showcase the highest CAGR. The services provide companies with professional competence to keep the client's business operating.
Ease of New Technology Integration to Surge Demand for Cloud-based CRM Software
The deployment criterion has been further divided into cloud and on-premises.
Cloud-based software is anticipated to dominate the market during the projection period. The cloud-based deployment provides immediate and real-time access to data that further helps in improving customer satisfaction. Moreover, it is accessible from any device and allows users to access client information at the same time. The market for cloud-based CRM software is being driven by rising product demand among small and medium-sized organizations. Also, cloud-based CRM software provides several benefits such as cost-effectiveness, accessibility, and almost no equipment expenditures.
Also, owing to the increasing requirements and IT funds, the demand for on-premises-based software is likely to gain traction.
Increasing Number of Customers among Large Enterprises to Fuel the Segment’s Growth
By enterprise size, the market is categorized into large enterprises and small and medium enterprises.
The large enterprise is anticipated to have the maximum market share. Large enterprises are investing in this type of software to address the rising challenges of monitoring overall performance. Further, owing to expensive marketing and IT expenditure, as well as the necessity to handle a large volume of customer data, large enterprises have emerged as the most important business participants.
The small and medium enterprise is anticipated to grow at the highest CAGR during the forecast period. The increasing competition to gain new customers is driving SMEs to focus on offering a better customer experience and maintaining relationships.
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Growing Focus on Increasing Customer Base to Drive CRM Demand in Lead Generation & Customer Retention
By application, the market has been segmented into marketing and sales automation, customer management, lead generation and customer retention, customer support and contact center, and others.
The lead generation and customer retention is expected to account the largest market share during the forecast period. Further, the digital transformation occurring across various end use industries is driving the enterprises to implement software. Also, businesses are witnessing an increase in service and product enquiries, and the adoption of the software is expected to help with lead creation process.
The customer support and contact center is expected to capture a significant share of market revenue. The software's immediate analysis is improving customer support and contact center operations in solving customer problems.
Digital Shift in BFSI to Boost This Segment’s Growth
Based on vertical, the market is categorized into banking, financial services, and insurance (BFSI), manufacturing, IT and telecommunications, retail and consumer goods, healthcare, transportation and logistics, and others.
The BFSI is expected to develop at a significant growth rate during the forecast period. The BFSI is rapidly shifting towards digitalization, necessitating the development of customer-specific software. Growing online banking services are also expected to increase demand for management software in order to gain and maintain loyal customers.
CRM software is also being used by the service provider industry, such as IT and telecommunications, to manage their large client base. The industry is implementing advanced technologies to better understand client needs and overall market trends.
The retail and consumer goods are anticipated to increase significantly during the projection period. Also, companies are gaining access to massive amounts of client data owing to the growth of online shopping platforms and smartphone applications.
CRM software is anticipated to rise significantly in healthcare. The industry deals with large, sensitive, and confidential customer data sets that require CRM software for administration and monitoring. The rising use of linked medical devices is projected to drive up demand for the software.
North America Customer Relationship Management Market Size, 2021 (USD Billion)
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By region, the market has been analyzed across five major regions, namely North America, Europe, Asia Pacific, the Middle East & Africa, and Latin America.
North America is expected to dominate the worldwide market size during the projection period. The fast-developing businesses and competitiveness among service providers are projected to drive demand for the software. Furthermore, the increasing installation of advanced technologies such as clothers5G, and other is offering a wide amount of customer preferences data as well as real-time forecast capabilities. Also, U.S. is expected to lead the region during the projected period owing to the presence of key market players.
Europe is anticipated to hold a significant position in the market. The growing number of small and medium-sized businesses in European nations is expected to boost the demand for software in order to obtain customer preferences and insights. Also, large enterprises are concentrating on learning about continually changing client behavior in order to develop future marketing and commercial strategies.
The Latin American market is expected to grow steadily during the projection period. Rising demand for software across industrial sectors including healthcare, BFSI, and retail is boosting the size of the region.
The Asia Pacific is anticipated to grow rapidly during the forecast period. The CRM market trend is in high demand owing to the demand across the retail industry and the widespread adoption of new technology in the region. Further, countries such as China, Southeast Asia, India, and Japan have different demographics including age structure, density, population size, and more. Further, these factors are helping in boosting the demand for this software in these countries’ service-providing businesses.
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The Middle East and Africa are expected to grow significantly owing to the fast adoption of technologies and digitization across industries. The increased government focus on customer data security and improving the customer experience is expected to drive market expansion in the region.
Key Players Are Entering into Strategic Partnerships to Expand Their Global Businesses
Key providers including Salesforce.com, Inc., SAP SE, IBM Corporation, Oracle Corporation, Infusion Software, Inc., NetSuite, Inc., and Copper CRM, Inc. are providing software.
Similarly, players continue to form strategic alliances with other players in order to increase their market position and generate brand promotion. The players offer efficient and advanced solutions through partnership and collaboration.
March 2022 – Oracle Cloud Infrastructure launched new capabilities and services aimed at providing customers with even greater flexibility. Further, with the launch the company would provide customers with flexible and core infrastructure services, automatically adjusting resources to fit application needs while greatly lowering expenses.
November 2020 – Infusion Software, Inc. introduced smart client management software for small businesses. Further, to expand CRM solutions, the company has rebranded its solution and offering as Keap product.
LIST OF KEY COMPANIES PROFILED:
An Infographic Representation of Customer Relationship Management (CRM) Market
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Key insights provided in the report are the adoption trends of CRM software and solutions by individual segments, recent industry developments such as mergers & acquisitions, consolidated SWOT analysis of key players, partnerships, Porter’s five forces analysis, and business strategies of leading market players, key industry trends, macro, and micro-economic indicators.
Value (USD billion)
Component; Deployment; Enterprise Size; Application; Vertical and Region
By Enterprise Size
Fortune Business Insights says that the global market size is set to reach USD 145.79 billion in 2029.
In 2021, the market value stood at USD 57.83 billion.
Registering a CAGR of 12.5%, the market will exhibit steady growth in the forecast period (2022-2029).
By component, the software segment is expected to lead this market during the forecast period.
Rapid digital transformation is the key factor driving the growth of the market.
SAP SE, Salesforce.com, Inc., and Oracle Corporation, IBM Corporation, NetSuite, Inc., Infusion Software, Inc., and Copper CRM, Inc. are some of the major players in the global market.
North America dominated the market in terms of share in 2021.
Asia Pacific held the highest CAGR in the market.
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