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SAP Wants to Double Its Customer Relationship Management Business

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$66 billion revenue opportunity

SAP (SAP) aims to double its CRM (customer relationship management) software sales in two years, according to Reuters. SAP seems to be excited by the CRM software market’s healthy growth. “In 2018, CRM software revenue will continue to take the lead of all software markets and be the fastest growing software market with a growth rate of 16 percent,” Gartner said in a release.

The global CRM software market is poised to grow to $81.9 billion by 2025, making it bigger than SAP’s core market, ERP (enterprise resource planning) software, which is expected to reach $39 billion in 2021, according to estimates by Grand View Research and Gartner. SAP is estimated to have held just 8.5% of the market last year, according to Gartner.

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SAP gearing up for a tough fight ahead

Given its small share of the CRM software market, SAP may have a big fight on its hands if it plans to take market share from the space’s current leaders. Aware of the strong opposition it is likely to face, SAP intends to price its CRM software competitively. Additionally, the company hopes to leverage its global reach and installed customer base to drive CRM growth.

SAP’s rivals not completely disarmed

However, rivals Microsoft (MSFT), Oracle (ORCL), and IBM (IBM), which boast years of presence in the enterprise software business, also have extensive global reach and a massive installed customer base that they could rely on to maintain control of the CRM software market. Furthermore, in stepping up its competition with Microsoft, SAP will be setting itself up against the world’s second-largest cloud provider, which controlled 13% of the global cloud market in the first quarter. Amazon (AMZN) leads the cloud space, with 33% of the market.

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