Customer Relationship Management Via Social Networks: Not Yet a Mature Market

By September 02, 2011

Despite real growth in this market, there are still only very few companies that have integrated Social CRM into their strategy. The result is a fragmented market with vendors who are often still quite small.

Despite a genuine increase in 2011, the market in Customer Relationship Management via one of the social networks (Social CRM) is still fragmented and immature, concludes a study by the Gartner Institute.  The study, which looks at the Customer Relationship Management market as a whole, forecasts turnover of over a billion dollars by 2012, an increase of 40%. However it underlines that the market is populated by many small vendors specialising in a particular area of Social CRM, bringing in less than one million euros per year in most cases, who are therefore not well placed to reap the rewards available in this market.

A segmented market, with three types of vendors

Why is this? At the moment companies that have integrated Social CRM into their operations have done so on an ad hoc basis, more as an experiment than a fully-fledged strategy. Because of this, their requirements vary enormously, and so do the services on offer from the small-scale vendors. We can distinguish three main types of service: sales, marketing, and after-sales service. It is this service fragmentation, itself due to the lack of consistency on the demand side, that is holding back the development of this sector.

Towards service diversification

In future, stresses Adam Sarner, "vendors will find it more and more difficult to differentiate themselves if they can only address one single area of a company’s needs". The challenge from now on is for the sector’s small vendors to be able to offer services which integrate all three elements, and can manage problems right across the three in an efficient way. Adam Sarner concludes: "The majority of vendors that survive and thrive in the mid-term will offer tools that can address multiple use cases in more than one department".

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