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 Back to 2006 Press Releases
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Gartner Says Worldwide CRM Total Software Revenue Increased 14 Percent in 2005 |
STAMFORD, Conn., June 12, 2006 - Driven by significant gains in license and maintenance revenue, worldwide customer relationship management (CRM) total software revenue totaled $5.7 billion in 2005, a 13.7 percent increase from 2004, according to Gartner, Inc.
"As business confidence returned in a strong commercial economy, buyers focused on solutions that drive revenue and expand business opportunities," said Sharon Mertz, research director at Gartner. "Robust gains resulted from strong vendor performance across the market, continued rapid adoption of on-demand solutions, increasing penetration of emerging markets, and buyer recognition of CRM applications as key drivers of customer acquisition and retention."
SAP was the No. 1 CRM vendor based on total software revenue, with a 25.9 percent market share in 2005 (see Table 1). Increased midmarket opportunity drove growth across the CRM market for both the large suite vendors and on-demand providers, such as Salesforce.com. Siebel's strong fourth quarter results drove growth, but at the expense of Oracle and PeopleSoft CRM solutions. Industry specialists such as Amdocs also benefited from high demand for vertical market solutions.
Gartner has traditionally measured market share in terms of new license revenue. However, due to the emergence and increasing popularity of open-source software and buyer consumption models such as hosted and subscription offerings, Gartner has moved to measure market share in terms of total software revenue. This includes revenue generated from new license, updates, subscriptions and hosting, technical support and maintenance. Professional services and hardware revenue are not included in total software revenue.
Table 1
Worldwide: CRM Total Software Revenue Estimates for 2005 (Millions of U.S. Dollars)
| Company |
2005 Revenue |
2005 Market Share (%) |
2004 Revenue |
2004 Market Share (%) |
2004- 2005 Growth (%) |
| SAP |
1,474.7 |
25.9 |
1,232.8 |
24.6 |
19.6 |
| Siebel |
966.1 |
17.0 |
908.3 |
18.1 |
6.4 |
| Oracle (Including PeopleSoft) |
367.5 |
6.4 |
416.2 |
8.3 |
-11.7 |
| SalesForce.com |
280.7 |
4.9 |
158.0 |
3.2 |
77.7 |
| Amdocs |
276.4 |
4.9 |
225.9 |
4.5 |
22.3 |
| Others |
2,332.6 |
40.9 |
2,071.7 |
41.3 |
12.6 |
| Total |
5,698.0 |
100.0 |
5,012.8 |
100.0 |
13.7 |
Source: Gartner Dataquest (June 2006)
"Merger and acquisition activity continued relentlessly in 2005, as large vendors acquired smaller firms and as market leaders acquired each other," Ms. Mertz said. "Market consolidation in 2005 remained a driver for best-of-breed and suite providers by offering a compelling value proposition and capitalizing on temporary buyer uncertainty. Buyers were solidly focused on new customer acquisition, expanding wallet share, process optimization, and business accountability."
Additional information is available in the Gartner report "Market Share: CRM Software Worldwide, 2005". The report is available on Gartner's Web site here.
CONTACT:
Christy Pettey
Gartner
(408) 468-8312
christy.pettey@gartner.com
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About Gartner:
Gartner, Inc. (NYSE: IT) delivers the technology-related insight necessary for its clients to make the right decisions, every day. Gartner serves 10,000 organizations, including chief information officers and other senior IT executives in corporations and government agencies, as well as technology companies and the investment community. The Company consists of Gartner Research, Gartner Executive Programs, Gartner Consulting and Gartner Events. Founded in 1979, Gartner is headquartered in Stamford, Connecticut, U.S.A., and has 3,700 associates, including 1,200 research analysts and consultants in 75 countries worldwide. For more information, visit www.gartner.com.
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