IDC Report Explores Increasing Demand for Customer Care Solutions in Europe

LONDON, June 11, 1999 — Increasing competition and the growing awareness that improving customer loyalty can be more profitable than growing market share are forcing companies to be more customer-centric. According to recent research from International Data Corporation (IDC), the availability of new technologies and the realization that customer retention is key are creating a high demand for the implementation of customer relationship management (CRM) solutions in Europe.

"Many IT service providers are now launching innovative customer relationship management offerings for industries such as finance, communications, manufacturing, and retail," said Rasika Pradhan, research analyst for IDC's European Consulting and Management Services program.

IDC anticipates the market for CRM consulting, implementation, and outsourcing services in Western Europe will grow from $7 billion in 1998 to $23 billion by 2003. "In Europe the CRM market has mainly been driven by investments in areas such as data warehousing and call centers," Pradhan added. "Today Europe is lagging behind the United States in terms of implementation of concepts such as one-to-one marketing and mass customization of products and services, but European companies are catching up." Leading software vendors are showing increased interest in sales force automation (SFA) and customer service front-end applications – SAP, Baan, and Oracle have already begun to build SFA functionality in their back-office modules.

Integrated enterprise customer management (IECM) – a more holistic view – looks at the wider picture and addresses the customer relationship at an enterprise level, linking back-office and front-office processes. Many market players consider this to be a far more beneficial approach as it illustrates the relationships between an organization and its customers as a whole. "In coming years we can anticipate a stronger demand for a holistic approach to CRM rather than as a single delivery," Pradhan said. "As this market develops, it is likely there will be many new areas of opportunity."

IDC's report Becoming Customer-Centric: Customer Relationship Management Offerings in Western Europe (#P09FB) outlines the development of CRM services in Europe, including the holistic view of IECM. Specifically, this report offers a comparative analysis including a leadership grid of 13 CRM service vendors and forecasts CRM services spending in the European market from 1998 through 2003. This report is available to purchase from your local IDC office.

About IDC

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