IDC Survey Shows a Third of European Businesses Are Not Interested in CRM Software

COPENHAGEN – MAY 31, 2001 – According to IDC’s recent end-user survey of 405 European organizations, end users in Europe are split on customer relationship management (CRM). More than 50% rate CRM as critical for their business, while nearly one-third are not interested at all.

 

"Much of this apathy relates to a simple lack of understanding of the benefits of CRM, not to mention basic functionality," said Bill Clough, senior research analyst with IDC’s European ERM and CRM Applications research program. "Now that companies are going to be a bit more careful with their IT budgets, and less driven by the ‘first mover’ or ‘early adopter’ messages, it will take even more effort on the part of software vendors to educate the market about the real needs that are met with CRM solutions."

The value and benefits of CRM seem ambiguous to many respondents. Although most identified with the benefit of improving customer service processes, many completely missed the possibility of key advantages such as customer acquisition and retention. "In tightening economic markets, when businesses begin to focus less on the latest technologies and more on what solves real problems and cost issues, these two benefits are not receiving the attention they deserve," Clough said.

Despite widespread media coverage and extensive software vendor marketing campaigns, the overall impression is that end users remain uncertain, if not suspicious, about the qualities and benefits of CRM technology. Overall, CRM technology has not taken the world quite by the storm that many expected.

IDC’s survey shows the response to CRM technology varies by country and industry. While some of these variations were expected, others were not. Only 36% of French respondents claimed to be using CRM software, while in the United Kingdom and Italy, 53% said they were using the technology. The European average was 46%. "End users in the largest economic zones appear most apprehensive about CRM technology. German and French respondents in particular rated CRM as a ‘no need’ among a long list of possible technologies," Clough explained.

The first industries to deploy CRM technologies were finance, services, and telecoms. These industries rate the importance of CRM significantly higher than the average. The two categories of respondents exhibiting the most apathy or uncertainty toward CRM were utilities and healthcare, with 39% and 45% of respondents, respectively, stating "don’t know" or "no need."

"These two sectors are certainly not commonly thought of in terms of customer services or marketing. However, as industries are privatized across Europe, interest will likely increase naturally as competition for customers takes a higher role in business," Clough said.

Demand-Side Survey: A Reality Check on CRM Software (IDC #LC23H) focuses on the current state of CRM software. It deals with matters such as which industries are most likely to use CRM solutions, how end users perceive their CRM projects to date, and where understanding and perceptions of CRM applications are strong or where there is still room to grow. To purchase this report, contact Chad Eaton at 1-800-343-4952, extension 6972, or at ceaton@idc.com.

About IDC

IDC delivers dependable, high-impact insights and advice on the future of ebusiness, the Internet, and technology to help organizations make sound business decisions. IDC forecasts worldwide markets and trends and analyzes business strategies, technologies, and vendors, using a combination of rigorous primary research and in-depth competitive analysis. IDC provides global research with local content through more than 700 analysts in 43 countries worldwide. IDC's customers comprise the world's leading IT suppliers, IT organizations, ebusiness companies, and the financial community. Additional information can be found at http://emea.idc.com.

IDC is a division of IDG, the world's leading IT media, research and exposition company.

 

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