Financial services firms will curb their spending on customer relationship management technology over the next five years, according to a new report from Meridien Research.
The report, "CRM Spending Update: Hitting the Wall or Taking a Time-Out?", suggests significant further market consolidation among suppliers will take place as financial institutions' spending flattens through 2003.
The study predicts global retail CRM spending in 2002 will stay level compared to 2001 at $6.7 billion, with no significant expansion expected until 2004. This is in part due to financial institutions struggling to master the complexity of channel integration and deal with the cost of building and maintaining an effective data warehouse infrastructure.
Corporate CRM spending, influenced mostly by commercial banks, will remain at $3.0 billion in 2002, and is also not expected to grow significantly until 2004, as many institutions examine their ROI from less-than-successful CRM investments, says Meridien.
Tom Richards, Meridien's research director for CRM, says: "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."