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Salesforce Services Market Booms at 28% Growth as 70% of Enterprises Struggle with Salesforce Integration

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June 29, 2020
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North America, largest Salesforce services market, posts 18% CAGR; markets outside North America grow faster with 35% CAGR

Although Salesforce dominates the US$57 billion global customer relationship management (CRM) software market with a 22% share, Everest Group reports that 70% of enterprises struggle with integrating Salesforce with other applications and platforms within and outside the Salesforce ecosystem. Accordingly, Everest Group predicts that Salesforce service providers who focus on building solutions to accelerate time-to-market and guide enterprises on the change management journey will be tomorrow’s market leaders.

Enterprise expectations from Salesforce adoption now go beyond customer experience and CRM software implementation to creating a competitive advantage. Recent Everest Group research reveals the high expectations of Salesforce users:

  • 45% expect their Salesforce adoption to enable them to identify new revenue streams
  • 60% expect that Salesforce will provide a single source of truth for customer data to expedite decision making
  • 55% expect faster and easier integration of Salesforce with both upstream and downstream industry-specific systems.

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For assistance in realizing these objectives, enterprises frequently engage third-party Salesforce service providers for consulting, implementation, maintenance and support services. The global Salesforce services market is estimated at US$14.5 billion, growing at a CAGR of 28% over the past three years. The market is also one of the largest and fastest growing in the broader enterprise platform services landscape.

“Enterprises now look to the CRM function to create a 360-degree customer view, but this requires a level of integration and organizational change that few enterprises have been able to achieve thus far,” said Yugal Joshi, vice president of Everest Group. “Organizations are aspiring to become an ‘intelligent enterprise,’ and this requires a ‘unified data fabric’ that encompasses their ecosystem, a fabric that weaves together all relevant data sources and leverages advanced analytics. Salesforce is expanding their offerings to help companies achieve this vision, particularly with products like Einstein for analytics and Mulesoft for integration. With changing enterprise expectations and the evolving Salesforce tech landscape, Salesforce service providers can play a critical role in helping enterprises derive maximum business benefit from the platform.”

These findings are discussed in more detail in Everest Group’s recently published report “Salesforce Services – Solving for the Missing Link.” The report includes insights on the market trends for Salesforce services, including deal trends and enterprise spend characteristics, based on the firm’s analysis of about 300 large Salesforce services deals.

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Key Trends in the Salesforce Services Market

  • North American Salesforce services market logged 18% CAGR since 2018, whereas the markets outside North America increased exponentially at 35% CAGR.
  • While Salesforce has increased the revenue guidance for 2021, Everest Group estimates that due to COVID-19 the overall growth of the services market will be negatively impacted in FY2021. This will primarily be due to large-scale transformation projects that may be kept on hold in industries such as travel, energy and utilities, and manufacturing, which will, in turn, negatively impact the demand for Salesforce consulting and implementation services.
  • Salesforce adoption is growing fastest (35% year-on-year) in the healthcare and life sciences industry. Regionally, Asia Pacific is fastest growing economy (~35% YOY), and marketing cloud is the fastest growing Salesforce product (~40%YOY).
  • Service providers are investing in building strong industry-specific solutions and integration frameworks to expedite time-to-market for clients.
  • Service providers are taking a strong inorganic approach with tuck-in acquisitions to fill gaps across their Salesforce services portfolio and further enhance their geographic footprint.

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