According to recent IDC research, the CRM market is clearly heating up again in Western Europe with small companies expected to increasingly demand CRM. Meanwhile, the market for large enterprises is by no means dead, and early adopters, especially in the financial services and telecommunications sectors, are once again investing in CRM.
Western European CRM application license and maintenance revenues reached $2.5-billion in 2005, growing 6.0% compared to 2004, while IDC expects the CRM applications market to grow at approximately 5.5% annually until 2010.
Salesforce.com is now clearly paving the way for software as a service in Western Europe. Its revenue grew almost 45% in the region in 2005, and the 2006 numbers are also looking impressive.
However, IDC believes that this is not the only trend that vendors should take into account in the SMB space. Eventually, small companies will increasingly demand fully-fledged CRM, which is easy to implement, use, and maintain, and IDC believes that Microsoft Office integration will become particularly important.
"While the market did not fully capitalise on CRM drivers such as 'renewed focus on revenue growth' in 2004, the Western European CRM market grew a healthy 6.0% in 2005 and IDC has raised its forecast for CRM applications revenues in Western Europe considerably," says Erik Bruin, research manager: European Enterprise Applications at IDC.