Long regarded as the "hot spot" of CRM, the small and medium-sized business (SMB) segment of the CRM market will grow at a compound annual growth rate of 5.5% through 2007 - substantially faster than the overall market, predicts research house Gartner.
One of the main motivations for the SMB market is that despite being relatively humble in size, many have world-class problems. They have the same processes as massive multinationals: they're just smaller, not simpler.
But if the mid-market has been hot for years, how can it still be hot? "We overestimate the amount of technology that's truly been implemented," say Yankee Group analysts. "There's still a lot of room for penetration, still a lot of room for adoption."
The IDC defines SMBs as independent enterprises with total assets of less than R30m, turnover less than R50m and less than 100 employees. It is estimated that SMBs will contribute some 35% of South Africa's GDP within the next 10 to 15 years, and depending on which analysts you ask, the SMB technology market will grow between 25% and 35% per year until 2006.
"There's a huge number of companies with both the means and the motivation to advance their business through CRM practices and technology," says SAP Africa's Simon Carpenter, who is this week unveiling SAP's new CRM 4.0 offering to an expectant public.
"Another advantage the mid-market has over large enterprise is the opportunity to implement total CRM, tie up the whole organisation and present the right information to the right people at the right time. Larger enterprises, which have been broken down into dozens of autonomous divisions, can be much more difficult to unify behind the notion of the singular view of the customer," says Carpenter.
CRM 4.0 is a key element of SAP's drive to grab a bigger slice of the CRM market.It is an end-to-end suite targeting 23 verticals, including automotive, consumer goods, high-tech, professional services, retail and telecommunications.
An important part of the new suite is its focus on the mid-market, says Carpenter.
"Delivering integrated functionality is the only way to go," says Carpenter. "An SMB company will never have the IT or professional services rands to achieve this, so the only way to accomplish this vision is through an out-of-the-box, integrated package."
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