Meridien Research, a Newton, Mass.-based financial industry technology analyst firm, today released its annual report in which it predicts spending on CRM technology through 2007. The global estimate, based on 55,000 institutions and examining the likes of external IT spending for hardware, software, and related development, consulting, and implementation services for financial industry segments, shows a slowdown in growth for the next few years.
The report predicts continued market consolidation among suppliers, claiming that financial institutions' spending increases will flatten through 2003 as they deal with such factors as channel integration and the cost of building and maintaining effective, robust data warehouse infrastructures to support a wide variety of analytical decision support applications.
It goes on to say that global retail CRM spending in 2002 will stay essentially level compared to 2001's $6.7 billion, warning of no significant expansion until 2004. And, as many institutions examine their return on investment from "less-than-successful CRM investments," corporate CRM spending will remain at $3 billion in 2002 and also is not expected to grow significantly until 2004.
"We foresee that top management at financial institutions that 'get CRM' will carefully seize upon the market confusion to quietly strengthen their arsenal of capabilities, often at bargain terms," said Tom Richards, Meridien's research director for CRM, in a prepared statement. "In particular, we expect leading institutions will dig into business processes, probing for both cost savings and better service levels for customers."