Among one of the categories in China’s enterprise application, the piping-hot CRM (customer relationship management) market is the rising start in China’s end-user restaurant industry. CRM software has become restaurants' favorite in analyzing customers’ consumption behaviors, such as preference, consumption frequency, most popular dishes, and time interval, to optimize their business performance.
Most of the restaurant CRM software equip with functions to complete a thorough customer value assessment model to summarize and reflect characteristics, including customer retention rate, occupancy, economic demographics, and other indicators. When China has a popular food delivery culture, the restaurant sector must cater to various customer needs to implement online ordering functions and increase business efficiency.
China's restaurants have started to apply CRM software in assisting with self-service order submission, menu information, and providing a digital code for each order to track inventory and sales records. The CRM market in China's restaurant industry has therefore thrived in response to its high efficiency of solving multiple inquiries within a short period of time.
The Massive Market Pairs With A Strong Growth Indicator
A collateral of the CRM market is the software as a service (SaaS) market. Both markets functionalize as extensions of the sales function in managing customer services and sales marketing. Relevant services can be applied to a wide variety of business scenarios such as marketing, online customer service, and e-commerce with prospects of further development. Various CRM platforms serve as a medium to coordinate sales, marketing, and service interaction between companies and their customers.
Starting from 2007, China has officially stepped into the CRM software market with a Shenzhen-based industrial pioneer, Kingdee International Software Group Limited. Currently, some of the primary main providers in China's CRM market include Salesforce, Veeva System, Kingdee, Waiqin 365, and Tencent Qidian. These CRM service providers are inevitably leading the country to progress further in the digital ecosystem.
According to International Data Corporation (IDC), in the first half of 2020, China's SaaS market reached USD 1.36 billion, with an increase of 27% year on year. Riding on the economic recovery trend after the pandemic, it is expected that the market will experience further growth in the next two years. Among different divisions in the SaaS market, China's CRM market has been a well-carved sector with the most mature development, occupying up to 59% of the SaaS market share. Along with product standardization, CRM software has met the precise needs for enterprises to transform into digitization in different sectors.
From 2016 to 2020, China's CRM market had grown at a CAGR of more than 17% in the wake of rapid software development and cloud-based platforms in recent years. According to East Money, China’s CRM software industry grew from CNY1.98 billion in 2014 to CNY 3.02 billion in 2018, with a CAGR of 11%.
The Future Outlook
In China, state regulations play pivotal roles in determining the future of industries. In the CRM market, the Chinese government released several positive regulatory policies to integrate the CRM software with a new consumption model.
For example, in September 2020, the Chinese government released guidance on expanding investment in strategic emerging industries and cultivating strengthened new growth points and growth poles. This announcement targets a transition of offline businesses by promoting e-commerce to overcome the adverse impacts of the pandemic. This guidance supports cloud-based enterprises to extend offline expansion and accelerate the digital transformation in traditional offline industries.
It is also associated with social marketing and encourages businesses to implement new models such as online shopping, collaborative manufacturing demonstration factories, and establishing high-standard industrial Internet platforms. In the restaurant and food sectors, the guidance promotes a new supply chain combining e-commerce and food delivery as a new service model. For a future outlook, per estimated, the CRM market's growth potential reaches above the ceiling and will peak to CNY 6.58 billion by 2023.