Customer Relationship Management (CRM) Market Size, Share & COVID-19 Impact Analysis, By Component (Software and Services), By Deployment (On-Premises and Cloud), By Enterprise Size (Large Enterprises and SMEs), By Application (Marketing and Sales Automation, Customer Management, Lead Generation & Customer Retention, Customer Support and Contact Center, CRM Analytics, and Social Media Management), By Vertical (BFSI, Manufacturing, IT & Telecommunications, Retail & Consumer Goods, Government, Healthcare, Transportation and Logistics, and Others), and Regional Forecasts, 2023-2030

The global Customer Relationship Management (CRM) market size was valued at USD 64.41 billion in 2022 and is projected to grow from USD 71.06 billion in 2023 to USD 157.53 billion by 2030, exhibiting a CAGR of 12.0% during the forecast period.

CRM software helps in managing, organizing, and monitoring business operations to increase customer satisfaction. The increasing use of advanced technologies, such as the 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,

In November 2021, Freshworks launched Freshstack, a modern Customer Relationship Management suite for startups. These suites help startup companies to grow faster, create personalized marketing campaigns and provide delightful experiences to their customers.

COVID-19 IMPACT

Surging Remote Location-based Employees and Clients to Drive the CRM Market 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 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 Customer Relationship Management 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 improved the customer experience. Industries, including BFSI, retail and consumer goods, and healthcare, made extensive use of these technologies.

The major vendors are now shifting their focus toward upgrading the manual safety and security processes wherein employees undergo tedious work of monitoring screens for hours with the view of providing efficient automated CRM solutions. By automating these solutions, intelligent cloud-based CRM would provide consolidated and analyzed information from a wide range of sources inside and outside the databases, giving decision makers actionable insights.

Besides, to stay competitive and increase their turnover, key suppliers are emphasizing go-to-market strategy, marketing conferences, and participation in technical/security exhibitions to reach out to their customers directly and cater for the unattended market.

Owing to the above mentioned factors, in the coming years, the penetration of Customer Relationship Management is going to be at its peak, further creating significant opportunities for big players as well as for startups. For instance,

• In May 2021, a blog on CRM statistics reported that over 91.0% of companies with more than 11 employees were utilizing CRM solutions. Additionally, the usage of CRM surged from 15.0% in 2010 to 97.0% in 2020.

LATEST TRENDS 

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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 Customer Relationship Management systems is increasing in order to improve the customer experience. According to research by IDC, Salesforce, Inc.'s AI-powered CRM system is used to provide users with a competitive advantage.

The 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 boost the Customer Relationship Management (CRM) market growth in future.

DRIVING FACTORS

Implementing Mobile-friendly and Multichannel Capabilities into CRM Solutions to Propel the Market

The increasing usage of mobile devices and smartphones led to a surge in demand for mobile-friendly Customer Relationship Management modules. Clients demand these solutions that can be accessed and used on various mobile devices, including smartphones and tablets. This is critical for businesses that rely on their sales division to be mobile, as they need to access customer data and sales tools remotely or on-the-go.

The integration of multichannel capabilities improves the effectiveness of marketing campaigns. CRM solutions that integrate mobile and social media channels enable businesses to reach consumers where they spend their time. It enhances the effectiveness of campaigns, resulting in higher conversion rates. Additionally, the ability to track customer interactions across channels can provide businesses with valuable insights into customer behavior and preferences, enabling them to create more targeted and effective marketing campaigns.

Furthermore, enhanced multichannel solutions improve customer experiences and drive customer loyalty. It enables its clientele to communicate with other companies on multiple channels, including social media, email, chat, and mobile phone. It enables the provision of a seamless experience, which aids enterprises in managing customer relationships more effectively, resulting in improved customer satisfaction, increased retention, and higher revenue growth. For instance,

• In April 2022, Freshworks Inc., which provides SaaS-based solutions, launched Freshworks CRM for the e-commerce industry. The solution unified customer records across customer support, sales, and conversational marketing, resulting in reduced market times and enhanced business decisions. It also includes multichannel and mobile capabilities that enable transactions on social media, online, and mobile channels for improving customer experience through e-commerce and digital commerce market.

RESTRAINING FACTORS

Lack of Customization and Standardization to Create Interoperability Issues and Hinder the Market

Customization, scalability, and standardization are essential components of the CRM solutions that businesses require to manage customer relationships effectively. Limited customization options restrict the ability of the business to tailor the application to their clientele's specific needs. This can be a significant challenge for businesses that require specific features or functionality to meet their unique requirements. Such circumstances lead to businesses investing in additional software or customization services, which can be expensive and time-consuming.

Utilization of multiple cloud services from different sources causes interoperability issues, which leads to a lack of standardization. Different solutions use different data models or APIs, which complicates integrating third-party systems and data sources. Additionally, businesses require scalable CRM solutions, which accommodate growth and expansion without significant investments in additional systems and infrastructure.

Thus, limited customization options limit businesses’ ability to extract value from their customer data while the lack of standardization creates interoperability issues that impact the effectiveness of cloud services. Scalability is also crucial for contact management, as companies require a solution that accommodates growth and manages a large amount of data effectively. Overcoming these challenges is essential for businesses to effectively manage customer relationships and gain customer loyalty.

SEGMENTATION

By Component Analysis

Increasing Demand for Software among SMEs to Drive the Segment’s Growth 

Companies offer various Customer Relationship Management software and services to customers. CRM software generated the maximum revenue in 2022. This 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 over the forecast period. The services provide companies with professional competence to keep the client's business operating.

By Deployment Analysis

Ease of New Technology Integration to Surge Demand for Cloud-based CRM Software

Customer Relationship Management software is deployed either on the cloud or on-premises.

The cloud segment is anticipated to dominate the market during the projection period. 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 cloud segment is 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 increasing requirements and IT funds, the demand for on-premises-based software is likely to gain traction.

By Enterprise Size Analysis

Increasing Number of Customers among Large Enterprises to Fuel the Segment’s Growth 

Large enterprises and SMEs are adopting Customer Relationship Management software and services for various purposes.

The large enterprises segment is anticipated to have the maximum market share. Large enterprises are investing in this 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 SMEs segment is anticipated to grow at the highest CAGR during the forecast period. The increasing competition to gain new customers drives SMEs to focus on offering a better customer experience and maintaining relationships.

By Application Analysis

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Growing Focus on Increasing Customer Base to Drive Software Demand in Lead Generation & Customer Retention 

Adoption of CRM solutions is increasing mainly for marketing and sales automation, customer management, lead generation & customer retention, customer support and contact center, CRM analytics, and social media management.

The lead generation & customer retention segment accounted for the largest market share in 2022. Further, 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 the lead creation process.  

CRM analytics segment is expected to showcase high CAGR during the forecast period. The availability of multiple platforms and the increasing acceptance of integrating analytics into solutions have enabled organizations to derive richer insights from their business data, driving the growth of this segment. 

For instance, in July 2021, new tools were introduced by Genesys for enabling rapid innovation for AI-driven customer experiences, including employee development and feedback, open messaging Application Programming Interface (API), and bot development and orchestration provided across multiple channels. These features provided by applications would surge the demand for CRM analytics.

By Vertical Analysis

Digital Shift in BFSI to Boost the Segment’s Growth

Various industries use CRM software, including Banking, Financial Services and Insurance (BFSI), manufacturing, IT and telecommunications, retail & consumer goods, government, healthcare, transportation and logistics, and others.

The BFSI segment generated maximum revenue in 2022 as BFSI is rapidly shifting toward digitalization, necessitating the development of customer-specific software. Growing online banking services are also expected to increase the demand for management software to gain and maintain loyal customers.

CRM software is also 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.

The use of this software is anticipated to rise significantly in healthcare. The industry deals with large, sensitive, and confidential customer data sets that require various software for administration and monitoring. The rising use of linked medical devices is projected to surge the demand for the software.

REGIONAL INSIGHTS

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The market is geographically studied across North America, Latin America, Europe, the Middle East & Africa, and Asia Pacific, and each region is further studied across countries.

According to our research, North America accounted for the largest revenue share in 2022, owing to the fast-developing businesses and competitiveness among service providers. Furthermore, the increasing installation of advanced technologies, such as 5G and others, are offering a wide amount of customer preferences data as well as real-time forecast capabilities. Also, the U.S. is estimated to be the leading country in the region during the forecast period owing to the presence of key market players. 

Europe is anticipated to hold a significant position in the Customer Relationship Management market share. The growing number of small & medium-sized businesses in European nations is expected to boost the demand for software to obtain customer preferences and insights. Also, large enterprises are concentrating on learning about continually changing client behavior to develop future marketing and commercial strategies.

The Latin America 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 report indicates that the Asia Pacific market will witness the highest CAGR over the forecast period. The market trend is in high demand owing to the increasing usage across the retail industry and the widespread adoption of new technology in the region. Further, 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 & Africa market is 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 INDUSTRY PLAYERS

Key Players are Entering into Strategic Partnerships to Expand their Global Businesses 

Major global corporations in the Customer Relationship Management market are developing partnerships and associating with other players to streamline and expand their business offerings. The partnerships and collaborations aid businesses in strengthening their product portfolios and expanding their reach to a larger customer base. Several key players, such as Adobe, Microsoft, Salesforce and others, have adopted this strategy for better business growth. For instance,

November 2021 – Adobe entered into a partnership with Real Madrid, a Spanish sports giant, for offering the Adobe Experience Cloud. Real Madrid connected to fans around the globe through Adobe Experience Cloud for an immersive sports entertainment experience.

January 2021 – Pegasystems Inc acquired Qurious.io, Inc. The aim of the acquisition was to include the capabilities of Qurious.io’s into the software portfolio of Pegasystems with an initial focus on the Pega Customer Service use case.

LIST OF KEY MARKET PLAYERS PROFILED:

• Infor, Inc. (U.S.)


• Infusion Software, Inc. (Keap) (U.S.)


• IBM Corporation (U.S.)


• Microsoft Corporation (U.S.)


• Oracle Corporation (U.S.)


• Salesforce.com, Inc. (U.S.)


• SAP SE (Germany)


• Adobe Systems, Inc. (U.S.)


• Zendesk, Inc. (U.S.)


• HubSpot, Inc. (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• September 2022 – Salesforce launched a real-time data platform Salesforce Genie that strengthens the entire Salesforce Customer 360 platform.


• April 2022 – Salesforce announced that Bose deployed Salesforce Customer 360 to expand the robust direct-to-consumer business


• March 2022- Hubspot Inc relaunched Service Hub, a customer service software that enables businesses to prioritize customer experience with a simple, connected platform that delivers true service. All new features help businesses increase team efficiency, connect with the front office, and deepen customer relationships. 


• January 2023- Agent-based CX software company NICE announced integrating its cloud-native customer service knowledge management solution, CXone Expert, with the OpenAI generative modeling used in ChatGPT.  


• August 2022-Cus Oracle introduced the next generation of Oracle Fusion Sales. It is a sales automation application used for identifying high-value opportunities and helps to close deals faster.

REPORT COVERAGE

An Infographic Representation of Customer Relationship Management (CRM) Market

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The research report includes prominent areas globally to gain enhanced insights into the market. Additionally, the report provides an understanding of the recent industry developments and evaluates modern solutions being adopted globally. It also highlights some growth-stimulating boundaries and components, allowing the reader to obtain an all-inclusive understanding of the market.

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