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Spending On CRM Apps Predicted To Soar In 2018

This article is more than 5 years old.

These and many other fascinating insights are from two research notes from Cowen published on May 29th, Cowen IT Spending Survey: Positive Momentum Continues and Takeaways from Cowen’s IT Spending Survey On Apps, Database, and Analytics (both client access reqd.)  The Cowen IT Spending Survey was conducted during April & May 2018. It's the largest the firm has ever completed, interviewing 157 senior IT professionals across key industries with material IT budgets. Respondents are limited to senior technology professionals with roles including CIO (31%), CTO (27%), Chief Data or Digital Officer (4%), and Senior IT Management (38%). In aggregate 62% of total respondents are in technology C-suite roles.

Industries represented include Communications & Media (34%), Financial Services (24%), Healthcare (10%), Consumer Packaged Goods and Retail (8%), Auto & Manufacturing (4%), Business Services (4%), Energy & Industrials (4%), Real Estate (3%), Food & Beverage (1%); and Other (6%). Please see pages 9 and 10 of the Cowen IT Spending Survey: Positive Momentum Continues and Takeaways for additional details on the methodology.

Key takeaways from the study include the following:

  • Sales & Marketing are the top two spending priorities in SaaS, suggesting that demand remains strong for Salesforce (NYSE: CRM) and ADBE (NASDAQ: ADBE). Cowen sees this as indicating companies are continuing to invest in front-office applications to drive customer-facing digital transformation initiatives. Cowen found technology C-level execs are most increasing their spending this year on Marketing, Service and Sales-related SaaS projects (all of which are in included in the CRM category of the survey). CRM is far and away leading all budget growth priorities in 2018. Salesforce Automation (SFA) moved from 3rd in the Cowen December 2017 survey to 1st in this one. Cowen found that technology C-level execs continue to place a high priority for innovation on front-office applications, particularly Sales & Marketing, with the goal of digitally transforming their businesses to sharpen the focus on top-line revenue growth strategies and plans.

  • 59% of technology C-level executives said they plan to invest more with Salesforce on integration projects following its acquisition of Mulesoft. Cowen’s survey analysis found that the 59% of technology C-level execs will invest more with Salesforce is over 2x the 28% who said they plan to emphasize continuing the use of 3rd party tools for integration needs. APIs and integration tools are becoming increasingly important as enterprises build next-gen application architectures and integrate various cloud-based and AI-based services, and Salesforce is now in a position to capitalize on this with the acquisition of Mulesoft.

  • 76% of C-level technology executives predict budgets for Microsoft Business Intelligence (BI)/Data Visualization analytics tools to increase the most in 2018, leading the category. Microsoft continues to dominate the BI/Data Visualization landscape with the company at the top of the list in each of the enterprise software surveys Cowen has conducted since May Cowen credits Microsoft with the advances they have made in key category products including their traditional BI stack platform (SQL Server), Azure Services and their interactive data visualization product, Power BI. Amazon’s AWS Quick Sight is in 2nd place, with 52% calling it a top investment priority up from 37% in the Cowen December 2017 survey, and 12% in the firm’s May 2017 survey.

  • Cloud-Native Databases and App Integration remain the highest priority in Data Management with technology C-level execs in 2018. 38% of technology C-level executives (up from 36% in the December 2017 survey) prioritized Cloud-Native Databases as a top spending priority. 35% (down from 47% in the December 2017 survey) highlighted Cloud API/Application Integration tools as a top spending priority to enable greater revenue growth in their companies. Cowen believes demand for Cloud API/Integration tools will continue to be strong as enterprises build next-gen application architectures and integrate their diverse cloud-based and AI-based services. Salesforce is now in a position to capitalize on these market dynamics due to their acquisition of Mulesoft and the opportunity to bring greater contextual intelligence and insight into every customer interaction and relationship.

  • Microsoft and IBM are preferred vendors by technology C-level execs for machine learning and Artificial Intelligence (AI) applications with Salesforce gaining ground in 2018. 33% of technology C-level execs indicated that Microsoft is the vendor they would be most likely to work with on machine learning and AI projects in 2018, overtaking IBM who has dropped in the Cowen survey. Salesforce jumped to 3rd place to 5th overtaking the Google Cloud Platform (GCP) and Amazon Web Services (AWS) with 14% citing the public cloud leader as their preferred vendor for machine learning and AI. Cowen finds these results track perfectly with their recent partner survey, 1Q19, Preview; Expect Solid Quarter; Survey Shows Very Positive Reaction to Mulesoft.

 

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