The market for customer relationship management (CRM) software is booming again, driven by demand for vertical industry applications and new deployment models such as software-as-a-service (SaaS), according to research firm Gartner.

Worldwide revenue is expected to top $8.9 billion (£4.5bn) this year, a 14.3% increase on 2007, and is forecast to reach $13.3 billion by 2012.

“The composition of the worldwide CRM market is evolving as vendors continue to extend regionally, increase penetration within existing accounts and gain new clients,offer flexible deployment models, and continue to develop the channel,” says Gartner research director Sharon Mertz.

The SaaS delivery model will pay a key role in the healthy growth enjoyed by the industry, she says.

North America remains the largest market for CRM, accounting for almost half of global revenues, with total spending on software reaching $4.3 billion in 2007. That will almost double to $7.6 billion by 2012. Europe is expected to exhibit steady, positive growth, rising from $2.6 billion in 2007 to $3.9 billion in 2012, says Gartner.

However, spending on CRM software in the Asia-Pacific region will make a major contribution to the global picture over the next four years, predicts Gartner, with revenues more than doubling from $410 million in 2007 to $840 million in 2012.