Gartner predicts that the worldwide customer relationship management (CRM) software market will increase by 14% this year.
The strong performance of the CRM software market is being fuelled by growth across all sub-segments and the explosive growth of software as a service (SaaS) solutions within the sales sub-segment, explains Gartner.
In 2006, SaaS represented 12% of total CRM software revenue, and it is on track to reach nearly 14% in 2007. By year-end, SaaS is forecast to represent more than $1 billion in CRM software revenue, growing at more than double the rate of the total CRM software market, the research firm explains.
"The sustained performance of major on-demand solutions providers is driving the growth in the SaaS segment," said Sharon Mertz, research director at Gartner.
"As businesses refresh existing sales force automation systems to align with their renewed drive for business and revenue growth, we expect this to push sales software to become the largest CRM sub-segment by 2011.
"In late 2008 and 2009 forward momentum will return to the market, as buying decisions become clearer and customers undertake platform migrations to service-oriented architectures," said Mertz. "Increasing demand for analytics, marketing automation and a focus on SaaS solutions will also drive growth during this time. Buyer application selection will continue to focus on areas showing rapid return on investment in all CRM sub-segments."
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