CRM to Pace Software Spending in 2011

A Gartner survey of global technology professionals indicates that spending on customer relationship management (CRM) software is expected to see the biggest increase of all the application software markets in 2011.

In comparing this year's budgets with those of 2010, 42 percent of the 1,500 IT executives polled said that they expect to increase spending on CRM in 2011. The second-highest response was office suites at 39 percent, and 36 percent said they would spend more this year on enterprise resource planning (ERP).

As the social Web plays an increasingly important role for online businesses, companies are spending more on technologies that encourage the development of customer communities and social networks. CRM software can help promote customer retention and enhance the customer experience, and marketing automation remains the segment with the strongest growth.

Overall, worldwide application software spending is expected to increase 31 percent this year, up 9 percent from 2010.

"The survey indicates a healthy investment trend for application software. Software application vendors should continue to build, fund and invest in software sales and marketing programs as the market is recovering, to maintain customers and expand revenue opportunities," says Gartner analyst, Hai Hong Swineheart.