Customer Relationship Management (CRM) Market Size, Share & Industry Analysis, By Component (Software and Services), By Deployment (On-Premises and Cloud), By Enterprise Size (Large Enterprises and SMEs), By Application (Marketing and Sales Automation, Customer Management, Lead Generation & Customer Retention, Customer Support and Contact Center, CRM Analytics, and Social Media Management), By Vertical (BFSI, Manufacturing, IT & Telecommunications, Retail & Consumer Goods, Government, Healthcare, Transportation and Logistics, and Others), and Regional Forecast, 2024 – 2032

The global customer relationship management (CRM) market size was valued at USD 91.43 billion in 2023 and is projected to grow from USD 101.41 billion in 2024 to USD 262.74 billion by 2032, exhibiting a CAGR of 12.6% during the forecast period.

Customer Relationship Management (CRM) software helps enterprises manage, organize, and monitor business operations to improve customer satisfaction. It streamlines customer service processes by providing agents with access to comprehensive customer information and history. This enables faster issue resolution, proactive support, and consistent service delivery across channels. By efficiently managing customer inquiries and requests, businesses can improve service levels and customer retention.

During the COVID-19 pandemic, businesses faced challenges, such as reduced consumer spending, shifting market dynamics, and changing customer preferences. As a result, there was a heightened focus on customer retention and loyalty, driving increased demand for customer relationship management software to help businesses maintain and strengthen relationships with existing customers. Industries, including retail and consumer goods, BFSI, and healthcare, made extensive use of these technologies.

In the scope of work, we have included solutions offered by companies, such as Infor, Inc., Salesforce, Inc., Zendesk, Inc., Hubspot, Inc., Adobe Systems, Inc., SAP SE, and others.

Impact of Generative AI

Growing Demand for Personalized Customer Interaction is Expected to Boost Market Growth

Generative AI has a positive impact on the market, as it can create content, simulate human-like conversations, and generate personalized recommendations. Gen AI can enhance customer relationship management systems by enabling more personalized and context-aware customer interactions. AI-powered chatbots and virtual assistants can engage with customers in natural language, provide real-time support, and offer tailored recommendations based on individual preferences and behavior, thereby improving overall customer experience. Moreover, generative AI algorithms can analyze vast amounts of customer data to uncover patterns, trends, and insights that traditional analytics methods may overlook. By leveraging predictive analytics, customer relationship management systems can anticipate customer needs, identify opportunities for cross-selling and upselling, and optimize sales and marketing strategies to maximize ROI.

Customer Relationship Management (CRM) Market Trends

Integration of Artificial Intelligence to Propel Potential Market Trend

The integration of artificial intelligence (AI) and machine learning (ML) technologies into customer relationship management systems is accelerating automation across various processes, including customer service, sales, and marketing. AI-driven chatbots, predictive analytics, and personalized recommendations are becoming standard features, enabling businesses to streamline operations and enhance customer experiences.

The software based on AI technology, including deep learning, machine learning, and natural language processing, helps organizations understand the psychological state of the customer. Using this data, the software manages and delivers solutions to consumers, assisting in the development of strong connections with applications. As a result of these factors, the adoption of AI technology is anticipated to fuel the customer relationship management market growth during the forecast period.

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Customer Relationship Management (CRM) Market Growth Factors

Implementing Mobile-friendly and Multichannel Capabilities into CRM Solutions to Propel Market

The increasing usage of mobile devices and smartphones led to a surge in demand for mobile-friendly customer relationship management (CRM) solutions. Many CRM vendors offer dedicated mobile applications for iOS and Android devices, providing users with native mobile experiences and optimized performance and usability. Mobile apps enable sales, marketing, and service teams to access CRM data, update records, and perform key tasks while on the go, even in offline mode.

Moreover, multichannel CRM enables businesses to engage with customers across various communication channels, such as email, SMS, social media, and messaging apps. CRM software integrates with popular messaging platforms, enabling seamless communication and tracking of interactions across channels within the system. Additionally, the ability to track customer interactions across channels can provide businesses with valuable insights into customer behavior and preferences, enabling them to create more targeted and effective marketing campaigns.

RESTRAINING FACTORS

Lack of Customization and Standardization to Create Interoperability Issues and Hinder Market Growth

Customization, scalability, and standardization are important components of the CRM solutions that enterprises need to manage customer relationships efficiently. Without customization options, CRM systems may not align with the unique needs and processes of different businesses. This inflexibility can result in inefficient workflows, redundant data entry, and resistance from users who prefer systems tailored to their specific requirements. Moreover, a lack of customization and standardization may result in vendor lock-in, where businesses become dependent on proprietary features or technologies that limit their ability to switch to alternative customer relationship management solutions in the future. This dependence can restrict flexibility, innovation, and competitive agility.

Customer Relationship Management (CRM) Market Segmentation Analysis

By Component Analysis

Increasing Demand for Software among SMEs Boosted Segment Growth

Based on component, the market is classified into software and services.

The software segment captured the maximum revenue share in 2023. CRM software helps businesses build stronger relationships with their customers by providing a 360-degree view. With access to historical interactions, purchase history, and communication preferences, businesses can deliver more relevant and timely communication, address customer inquiries more effectively, and anticipate their needs, leading to increased consumer satisfaction and loyalty. The software has grown at an unprecedented rate among SMEs, owing mostly to the rising demand to manage customer experience and retain new customers.

The services segment is anticipated to showcase the highest CAGR over the forecast period. Services provide companies with professional competence to keep the client's business operating.                                                                                     

By Deployment Analysis

Ease of New Technology Integration to Surge Demand for Cloud-based CRM Software

Based on deployment, the market is bifurcated into cloud and on-premises.

The cloud segment is expected to dominate the market by growing at the highest CAGR in the coming years. Cloud-based deployment operates on a subscription-based pricing model with no upfront costs for hardware or software licenses. This pay-as-you-go model allows businesses to avoid large capital expenditures and instead pay a predictable monthly or annual fee based on usage.

The on-premises segment captured a larger share of the market in 2023. It enables businesses to have full control over their data and infrastructure, including customization options, integration, and data management. This level of control allows businesses to tailor the CRM system to their specific needs, workflows, and security requirements.

By Enterprise Size Analysis

Growing Popularity of CRM Software among Large Enterprises to Boost Segment Growth

Based on enterprise size, the market is divided into large enterprises and SMEs.

The large enterprises segment is anticipated to have the maximum market share. Large enterprises have vast amounts of customer data scattered across multiple departments, systems, and locations. Customer relationship management software enables these organizations to centralize and consolidate customer data into a single database, providing a comprehensive view of customer interactions, preferences, and behaviors.

The SMEs segment is anticipated to grow at the highest CAGR during the forecast period. This software helps small and medium-sized enterprises build stronger relationships with their customers by providing a centralized database for storing and managing customer data. This allows SMEs to better understand customer needs, preferences, and behavior, enabling personalized interactions, targeted marketing campaigns, and proactive customer service.

By Application Analysis

Growing Focus on Increasing Customer Base Propelled Software Demand in Lead Generation & Customer Retention 

Based on application, the market is categorized into marketing and sales automation, customer management, lead generation & customer retention, customer support and contact center, customer relationship management analytics, and social media management.

The lead generation & customer retention segment held the largest market share in 2023. Digital transformation occurring across various end-use industries is driving enterprises to implement software. Also, businesses are witnessing an increase in service and product enquiries, and the adoption of the software is expected to help with the lead creation process. 

The CRM analytics segment is anticipated to showcase a high CAGR during the forecast period. It automates lead scoring and prioritization processes by assigning scores to leads based on their likelihood to convert into customers. By analyzing lead attributes, engagement metrics, and historical data, businesses can identify and focus on high-quality leads with the greatest potential for conversion, optimizing sales efforts and improving sales productivity.

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By Vertical Analysis

Increasing Digital Shift in BFSI to Boost the Segment’s Growth

Based on vertical, the market is categorized into Banking, Financial Services and Insurance (BFSI), manufacturing, IT and telecommunications, retail & consumer goods, government, healthcare, transportation and logistics, and others.

The BFSI segment captured the maximum customer relationship management market share in 2023, as BFSI is increasingly focused on delivering personalized and tailored experiences to its customers. CRM software enables BFSI institutions to centralize customer data, track interactions, and analyze customer behavior, allowing them to understand customer needs better and provide targeted products, services, and communication.

The retail and consumer goods segment is anticipated to grow at the highest CAGR during the projection period. This software enables retailers to create and execute targeted marketing campaigns based on customer segmentation, demographics, and purchase history.

REGIONAL INSIGHTS

By region, the market has been analyzed across five major regions, namely North America, Europe, Asia Pacific, Middle East & Africa, and South America.

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North America held the largest revenue share in 2023, as businesses in North America prioritize customer experience and satisfaction as key differentiators in today’s competitive marketplace. CRM software helps businesses manage customer relationships, personalize interactions, and deliver superior customer service, driving customer loyalty and retention. In addition, the U.S. is projected to account for the larger share of the market in the region in the coming years, owing to the presence of key market players.

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Asia Pacific is expected to grow at the highest CAGR during the forecast period. The region is experiencing rapid economic growth, driven by emerging markets, such as China, India, and Southeast Asia. As businesses expand and competition intensifies, there is a growing emphasis on customer-centric strategies to differentiate brands and drive growth, fueling the adoption of customer relationship management software in the region.

Europe is anticipated to hold a prominent position in the market. European businesses are embracing digital transformation initiatives to modernize operations, improve efficiency, and stay competitive in the global marketplace. Customer relationship management software plays a crucial role in digital transformation by providing tools and capabilities for managing customer data, automating processes, and leveraging data insights to drive business growth.

The Middle East & Africa is experiencing rapid economic growth and diversification, driven by factors, such as urbanization, infrastructure development, and investment in non-oil sectors. As businesses expand and diversify, there is a growing need to manage customer relationships effectively, driving the adoption of CRM software.

South America is expected to grow steadily during the forecast period. Many businesses in South America operate in global markets and require CRM software that can support their international operations and expansion efforts.

List of Key Companies in Customer Relationship Management (CRM) Market

Market Players Focus on Acquisition and Partnership Strategies to Expand Their Analytics Services Globally

Companies focus on industry-specific services to amplify their geographical presence globally. Market players are accentuating collaborations and acquisitions with regional players strategically to maintain dominance. Leading companies are introducing novel products and making increasing investments in R&D for product innovation to increase their consumer base. Hence, top companies are rapidly implementing these strategic initiatives to sustain their competitiveness in the market.

List of Key Companies Profiled:

• Infor, Inc. (U.S.)


• Infusion Software, Inc. (Keap) (U.S.)


• IBM Corporation (U.S.)


• Microsoft Corporation (U.S.)


• Oracle Corporation (U.S.)


• Salesforce, Inc. (U.S.)


• SAP SE (Germany)


• Adobe Systems, Inc. (U.S.)


• Zendesk, Inc. (U.S.)


• HubSpot, Inc. (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• September 2023: Salesforce, Inc. launched the next generation of Einstein Copilot. It is a conversational assistant powered by AI technology. It will be used in every CRM application of Salesforce to improve productivity and create personalized experiences.


• June 2023: Proton.ai partners with Infor to develop a CRM solution enabled by AI technology. Integration of AI technology into the solution would help the company enhance its customer experience and drive revenue.


• January 2023: NICE, an agent-based CX software company, integrated its cloud-native customer service knowledge management solution, CXone Expert, with the OpenAI generative modeling used in ChatGPT.


• May 2022: Zendesk launched a Conversational Commerce tool to help companies establish connections with shoppers. The tool will provide customers with direct support from the sales and marketing team within a conversation throughout their digital customer experience (CX) journey.


• April 2021: Hubspot launched a new CRM tool named Operations Hub to expand its portfolio. This tool was designed to help operations professionals in various businesses across the globe.

REPORT COVERAGE

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The report provides a detailed analysis of the market and focuses on key aspects, such as leading companies, product/service types, and leading applications of the product. Besides, the report offers insights into the market trends and highlights key industry developments. In addition to the factors above, the report encompasses several factors that contributed to the growth of the market in recent years.

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Report Scope & Segmentation