Fewer firms will purchase CRM in 2002

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By: Wise Marketer Staff |

Posted on April 2, 2002

While still predicting that technology will play a major part in driving results, executives of Global 3,500 companies are not going to be splashing out on it this year.

Spending on eBusiness technology will drop from an average of 3.5% of revenue in 2001 to 3.0% in 2002. According to a new Forrester Research survey of Global 3,500 firms, the average budget for e-Business technology in 2002 is US$29m, compared with US$41m in 2001. According to Tom Pohlmann, senior analyst at Forrester: "Compared with 2001, companies are much more risk-averse when considering new technologies, opting to make do with what they have before buying more."

The number of firms considering buying "nuts and bolts" technology like servers, networks and storage hardware has fallen by almost a quarter and, for the sellers of enterprise application software like CRM, ERP, supply chain and procurement, the situation is even worse: the number has fallen by more than half.

Other key findings:

  • Some 61% of Global 3,500 firms will consider buying hardware, software infrastructure or network bandwidth in 2002.
  • Only 26% will consider buying enterprise applications (from 58% in 2001).
  • The number of firms buying technology consulting and implementation services has fallen 28% from 2001.
  • Midsize firms lead Global 3,500 firms in rollouts of voice over IP and wireless LANS, and Canadian firms lead US firms in the adoption of PDAs, supply chain software and enterprise portal technologies.

Online revenues to increase
However, companies still believe that technology will make a huge difference in driving business results. Executives estimated that their online-generated revenues would reach 7.3% of overall corporate revenues in 2002 (5.7% in 2001). They also estimated that in five years, online revenue will comprise a fifth of total corporate revenues.

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