Responding to customer pressure to provide comprehensive applications, CRM vendor consolidation among major players is likely to increase. However, some small CRM vendors, particularly those in well-defined niche markets, will survive on their own.
According to Gartner, the CRM vendor landscape will shrink in years to come. Per the research firm, the five largest CRM vendors controlled 60 percent of the marketplace in 2011 and three or four vendors will control a significantly large share of the CRM marketplace by 2020. At present the trend among large CRM vendors is to evolve into platforms for software and service partners.
The emergence and growth of Social CRM has led to a tremendous opportunity for social media companies to expand into the Social CRM marketplace. ISM expects that smaller social media companies, such as INgage Networks, Lithium, Attensity, Jive and Socialtext, will increase their presence in the marketplace with consolidation and their ability to offer a more open platform that easily integrates with other social media applications. Lithium’s acquisition of Scout Labs, a rapidly growing social media analytics company, will enable Lithium to conduct a thorough analysis of customer behaviors within social media communities and over the social web. ISM expects Lithium and other key social media companies to continue making investments to support emerging requirements in the Social CRM space such as social media monitoring platforms, natural language processing and sentiment analysis engines (for social media analytics), community platforms and business process platforms. RightNow’s acquisition of HiveLive, Attensity’s acquisition of Biz360 and Jive’s acquisition of Filtrbox indicates the beginning of emergence of market convergence to Social CRM suites.
Smaller social media vendors will form key partnerships or be acquired by larger social media and CRM vendors within the next few years. The key result of these partnerships/acquisitions will be that Social CRM suites will rise to the next level and deliver tighter integration with existing CRM processes to provide strong, more accurate customer insights and analytics for their users.