November 16th, 2012 by Leonard Klie

As we come up on another Thanksgiving holiday, talk of the end of the year and start of 2013 are not far behind. A lot of ad dollars will be spent around New Year’s resolutions (think of all the ads for quitting smoking, joining a gym, losing weight, etc.) that are just a few short weeks away.

The start of a new year also brings lots of predictions, forecasts, and otherwise noble attempts to tell us what to think about, do, watch, listen to, or otherwise occupy our attention with in the 12 months to come.

The CRM industry is no different, and Nucleus Research is the first one out of the gate with its predictions for 2013. Nucleus’s 2013 predictions are influenced by its ongoing analysis of IT investment and decision makers, as well as the macro and microeconomic factors that shape buying decisions in the technology industry.

Here are the highlights that relate specifically to the CRM industry:

This year presented some significant shifts in the strategies of some long-dominant vendors toward cloud, social capabilities, services, integration, analytics, and partner ecosystem plays—showing that all dogs must learn new tricks or they will lose market share and dominant positions in 2013.

BI and Big Data:

Nucleus expects business intelligence adoption will double worldwide in 2013 as greater usability for non-expert analytics users, lower-cost options, including cloud and software-as-a-service, and further efforts by vendors to make BI accessible to every user will drive broader adoption. The great potential ROI opportunities from pervasive BI will make 2013 the watershed year for BI adoption, and vendors with usability advantages and adoption paths for individual end users beyond the data geeks will reap the rewards.

The increased availability of analytics has led to a new sort of statistics-driven genius, the superstar data interpreter embodied by the likes of Moneyball‘s Billy Beane or The New York Times‘ Nate Silver. Although these stars are fluent in analytics and statistics, their primary value is derived from their ability to translate statistical analysis into business decisions. To maximize analytics ROI, every organization needs to identify its own Billy Beane and give that person access to pervasive and predictive analytics.

In 2013, the biggest value proposition for big data will not come from the trendy topics of social media or governance, risk management, and compliance. Instead, big data will help companies that have greedily latched onto every piece of data that they can grab from customers, partners, markets, and the outside world and stored them as a dragon’s den of accumulated treasure.

With the emergence of big data search and analysis tools to support Hadoop distributions and other large data repositories, these data hoarders will finally gain the ability to filter and translate these multi-terabyte and petabyte stores of data on a daily or weekly basis to gain valuable insight on their existing revenue- producing operations.

The CX Arms Race Continues:

Marketing and acquisition spending around customer experience management reached a fevered pace in 2012, even for many vendors not traditionally considered as CRM market players. Nucleus expects this will accelerate further in 2013 as companies seek to take advantage of the 80 percent of ROI potential that has yet to be delivered by CRM. We expect some real shifts in perceived market leadership as well, as customer experience takes a broader set of technologies and capabilities than basic CRM.

Customization Ends:

Given the ongoing cost of supporting customizations, the rise of software that can be configured by business users, and the push of vendors to reduce complexity and cost in their customers’ application deployments, custom development budgets will plunge as a percentage of overall application spending plans in 2013. Also declining will be those hefty services contracts that made EDS and some other acquisitions a bad bet in 2012.

No doubt more of these predictions will follow, and I bet a lot of them will offer the same insight.

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