The customer relationship management (CRM) market is mature, bloated and consolidation is going to continue for the foreseeable future. The upshot: Technology buyers need specialized CRM vendors, but they could wind up absorbed by a giant.
That was one of the primary takeaways from a Forrester report on the CRM market. The research firm released its wave report for CRM vendors catering to midsized and large enterprises.
Forrester's report may not have broken new ground, but did outline a key challenge for tech buyers. As the CRM market consolidates, more acquired companies and features may just mean bloat. Simply put, the CRM landscape is crowded. Forrester gave Paul Greenberg's CRM Idol competition a shout-out because it highlights how many vendors are in the field.
Forrester analyst Kate Leggett said:
Each of the leading vendors in this mature market offers a checklist of features and functions. Remember that more is not better; many times more is just more. In fact, when you don't need or can't use extra features, more is sometimes worse. CRM buyers must understand the market segmentation in order focus in on the right category of vendor that is the right size for their needs.
Don't lose sight of that point. As Greenberg recently noted the suites may not be all that sweet.
Overall, Salesforce, SAP, Oracle and Microsoft lead the field. For midsized companies, Forrester rated Salesforce and Microsoft as the best CRM choices. SAP, Oracle and Microsoft led the pack for large companies.
All that said the customer experience software game is changing. Forrester noted that all CRM vendors can check the various boxes---social engagement, email marketing etc---to win deals, but many IT buyers are likely to have a specialized vendor such as eGain, Astute, KANA and Adobe as well as a large suite player.
In the midsized market, Forrester put Aptean, Maximizer Software, bpm'online, SugarCRM and Sage it its Wave ranking along with more familiar names such as Salesforce, NetSuite, Microsoft, Infor and SAP.
The rankings of those vendors highlight how the midmarket varies significantly from the ones that cater to larger companies. For mid-sized firms, the big names often strip down existing applications for them. Meanwhile, when times are good the midmarket can be ignored by the big names. The takeaway is that more vendors can play in the midmarket space.
Of course, that reality does raise the consolidation issue. Large players may just buy up the smaller fish just to check off a few more CRM boxes.
Here's a look at Forrester's ranking for large enterprise CRM vendors.