CRM Adoption issues
In 2003, a Gartner report estimated that more than $2 billion had been spent on software that was not being used. According to CSO Insights, less than 40 percent of 1,275 participating companies had end-user adoption rates above 90 percent. Many corporations only use CRM systems on a partial or fragmented basis. In a 2007 survey from the UK, four-fifths of senior executives reported that their biggest challenge is getting their staff to use the systems they had installed. 43 percent of respondents said they use less than half the functionality of their existing system. Recently, it is found in a study that market research regarding consumers’ preferences may increase the adoption of CRM among the developing countries’ consumers.
The CRM Paradox also referred to as the “Dark side of CRM”. Favouritism and differential treatment of customers may cause perceptions of unfairness which results in buyers opting out of relationships, spreading negative information, or engaging in misbehaviour that may damage the firm. CRM fundamentally involves treating customers differently based on the assumption that customers are different and have different needs. This may cause dissatisfaction, issues of distrust and unfair practices due to the perceived inequality. A customer shows trust to bond in a relationship with a firm when they know that the firm is acting fair in creating a win-win situation. However, will customers trust that firms will be fair in splitting the value creation pie in the first place? A good example: Amazon.com’s test use of dynamic pricing (different prices for different customers) was a public relations nightmare for the company.
The CRM market grew by 13.7 percent in 2013, three times the average of all enterprise software categories. The following table lists the top vendors in 2008, 2012 and 2013 (figures in millions of US dollars) published in Gartner studies.
Many CRM vendors offer subscription-based web tools (cloud computing) and software as a service (SaaS). Some CRM systems are equipped with mobile capabilities, making information accessible to remote sales staff. Salesforce.com was the first company to provide enterprise applications through a web browser, and has maintained its leadership position. Traditional providers have recently moved into the cloud-based market via acquisitions of smaller providers: Oracle purchased RightNow in October 2011and SAP acquired SuccessFactors in December 2011.
The era of the “social customer “refers to the use of social media (Twitter, Facebook, LinkedIn, Google Plus, Pinterest, Instagram, Yelp, customer reviews in Amazon, etc.) by customers. CR philosophy and strategy has shifted to encompass social networks and user communities.
Sales forces also play an important role in CRM, as maximizing sales effectiveness and increasing sales productivity is a driving force behind the adoption of CRM. Empowering sales managers was listed as one of the top 5 CRM trends in 2013.
Another related development is vendor relationship management (VRM), which provide tools and services that allow customers to manage their individual relationship with vendors. VRM development has grown out of efforts by ProjectVRM at Harvard’s Berkman Center for Internet & Society and Identity Commons’ Internet Identity Workshops, as well as by a growing number of start-ups and established companies. VRM was the subject of a cover story in the May 2010 issue of CRM Magazine.
In 2001, Doug Laney developed the concept and coined the term ‘Extended Relationship Management’ (XRM). Laney defines XRM as extending CRM disciplines to secondary allies such as the government, press and industry consortia.
CRM futurist Dennison DeGregor describes a shift from ‘push CRM’ toward a ‘customer transparency’ (CT) model, due to the increased proliferation of channels, devices, and social media. Capterra, Inc. ranked the Top CRM Software Solutions in 2013 based on total number of customers, total number of users and social presence.