12% Of ASEAN Medium Businesses Have Deployed Customer-Relationship Management (CRM) Software.

-- MBs in ASEAN countries look towards CRM solutions to become more competitive, says AMI --

SINGAPORE -- Software spending by medium businesses (MBs, companies with 100-999 employees) in ASEAN (Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam) reached US$233 million in 2008--with $24 million coming from CRM solutions. The spending is nascent across ASEAN countries but its growth rate has been impressive. CRM software spending grew by 21% since 2007 and is set to continue growing even in the current economic situation.

"Medium businesses in ASEAN are beginning to look at CRM software as a tool to enable their companies to be more competitive - especially in the current recession," says Daniel Sim, Consulting and Research Manager for AMI-Partners. About 80% of medium businesses have rated "competition" as highest among the list of challenges they face. "Next to competition, the next most challenging area for is improving profitability. In addition to generating new sales, companies are paying more attention to retaining existing customers and not losing them to competitors. "Companies with CRM deployment are in better position to compete given the access to customers' information and fine tuning the information into actionable plans," maintains Mr. Sim.

Comparing across countries in ASEAN, Singapore has the highest penetration of CRM at 18%. Singapore's high level of ICT adoption and its strong global business relationships are key reasons for the high adoption of CRM solutions. In terms of CRM modules adopted by medium businesses in ASEAN, sales force automation is currently the highest. Call centers are the next highest in demand. Businesses are looking to understanding their customers' preferences in greater detail. As companies generate lesser sales in the current economic climate, businesses are increasingly focusing on retaining existing customers to generate sales.

As AMI intelligence points toward greater relevance of CRM deployment in helping businesses stay competitive, CRM vendors would do well to capitalize on this opportunity. Vendors should look at their product offerings and determine the right product mix for medium businesses yet to deploy CRM solutions. Vendors should also be aware that more than half of the currently deployed CRM solutions are home-grown solutions. These home-grown solutions differ from solution to solution and do not necessarily have the capabilities of industry-proven solutions from the likes of Microsoft, Oracle or SAP. CRM as SaaS is still in its infancy at this moment. SaaS-based CRM contributed more than 1% of total deployed SaaS solutions in ASEAN. Although unchartered waters for most medium businesses, respondents are telling AMI-Partners that the low-cost and hassle-free setup are worth considering.

CRM is expected to grow in 2009 at a slower rate of 18% over 2008. Vendors focusing on new accounts from medium businesses will face more challenges. Creative selling is needed to sign up new customers from the 88% non-CRM businesses and convincing users of existing CRM-deployed solutions to switch to a better product. Developing relationships with the right channel partners with a good understanding of their customers' business development requirement may hold the key to success in selling CRM solutions.

Related Studies

AMI-Partners' offers many reports covering MBs in the ASEAN countries. These studies highlight major trends in the context of current/planned IT, Internet and communications usage and spending. Products and services covered include established and emerging hardware, software, applications and business process solutions. Based on AMI-Partners' annual surveys of SMBs in India, the studies track a broad spectrum of issues pertaining to budgets, purchase behaviors, decision influencers, channel preferences, outsourcing, service and support. Also covered are detailed firmographics and critically important technology attitudes and strategic planning priorities. This data points to key opportunities and messaging hot buttons for vendors and service providers seeking to match their offerings to SMB market requirements.

In light of global recessionary fears and the impact of economic downshifts on business, AMI-Partners has expanded its tracking studies to include several questions pertaining to SMBs' perceptions of their dependence on local, national and global economies as well as their expectations about economic growth. These questions gained added significance in light of the timing of this year's studies, which overlapped with the global financial crisis starting in mid-September. AMI-Partners' studies, thus, present an early picture of an SMB market undergoing a major transition. Given that many SMBs are at the leading edge of this transition, AMI-Partners has included an additional analysis in this year's reports to assess demographics, attitudes, current IT adoption as well as planned IT purchases among "concerned SMBs" compared to the rest of the market. (AMI-Partners defines concerned SBs as those that expect the local/regional economy will get worse in the next one year and concerned MBs as those that expect the local/regional, national or global economy to get worse in the next one year.)

For more information about this study, AMI-Partners, or our global SMB research, call 212-944-5100, e-mail [e-mail] or visit the AMI website at www.ami-partners.com.

About Access Markets International (AMI) Partners, Inc.

AMI-Partners specializes in IT, Internet, telecommunications and business services strategy, venture capital, and actionable market intelligence -- with a strong focus on global small and medium businesses (SMBs), and extending into large enterprises and home-based businesses. The AMI-Partners mission is to empower clients for success with the highest quality data, business strategy perspectives and "go-to-market" solutions. Led by Andy Bose, the firm has built a world-class management team with deep experience cutting across IT, telecommunications and business services sectors in established and emerging markets.

AMI-Partners has helped shape the go-to-market SMB strategies of more than 150 leading IT, Internet, telecommunications and business services companies. The firm is well known for its IT and Internet adoption-based segmentation of the SMB markets; its annual retainership services based on global SMB tracking surveys in more than 25 countries; and its proprietary database of SMBs and SMB channel partners in the Americas, Europe and Asia-Pacific. The firm invests significantly in collecting survey-based information from several thousand SMBs annually, and is considered the premier source for global SMB trends and analysis.