Predictions

www.cio.com |  Software

IF YOU HEAR A KNOCK, KNOCK, knocking at the door, chances are it'll be
salespeople hawking customer relationship management (CRM) wares. And they're eyeing a
huge market opportunity: Companies are expected to spend a combined $90 billion in 2003
integrating new CRM systems.

At least these are the numbers being bandied about by market researcher IDC.
Worldwide CRM services revenues, including consulting, systems integration and
outsourcing will exceed $40 billion in 1999, and jump to a staggering $90 billion in
2003, predicts IDC (a sister company to CIO). These figures dwarf those previously
presented by Aberdeen Group, a Boston-based research company, which forecasted that the
CRM market will hit $4.45 billion by 2001.

The whirl of CRM hype centers around an ambitious goal: building an integrated and
corporatewide view of the customer. By tying together all the front-office functions
that involve customer contact, companies aim to present a single face to the customer.
This means that disparate customer-care and ERP systems must be linked. More important,
however, customer-facing IT systems in sales, marketing, call centers and online
support must become organizationally and technically integrated.

Why all the fuss? It's good old-fashioned customer service speak, says Katrina
Menzigian, manager for IDC's CRM services research program. "It's cheaper to encourage
existing customers to buy more products and services than it is to court new
customers...and today's consumers have little tolerance for inefficient customer
service," she says.

Consequently, corporations are creating new departments and job titles, such as
vice president of customer care. Vendors and service providers haven't missed the
signs, either. Companies big and small, from all sorts of backgrounds, are staking out
the market for the first time, according to IDC. Within the past 18 months, most of the
major consulting and systems integration firms have introduced a CRM offering.

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