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Worth reading:

The big ones get bigger, the little ones kick-part 2



CRM market power through Adobe Salesforce and Microsoft

This week’s CRM Tech World SMS provides two more examples of what Georg Blum described under the title “The big ones are getting bigger, the small ones are kicking”. Hence the subtitle: CRM market power through Adobe Salesforce and Microsoft.

Georg Blum referred to the CRM or MarTech market and the many cooperations as well as acquisitions and doubted that “a company always has to get bigger to be more successful”. He wrote that international policy makers were not concerned about this until the large corporations had emerged and were mostly unavoidable. The same now seems to have come true with regard to the EU’s General Data Protection Regulation (GDPR).

Google benefits from the DSGVO

According to a study by the German Trade Association, the implementation of the DSGVO has so far cost medium-sized retailers in Germany around 630 million euros. 60 percent of the companies estimated the implementation effort as very high or high and also 60 percent of the respondents had to call on external help. Around 40 percent are restricting their digital activities because of the GDPR.

On the other hand, Google is a beneficiary of the GDPR. A study of tracker penetration by Cliqz and Ghostery showed that smaller advertising trackers in particular have lost significant reach, which could serve as an indicator of market share. They lost between 18 and 31 percent. Facebook suffered a decline of just under 7 percent, and market leader Google even increased its reach slightly. In other words, the small ones are struggling and losing, while the big ones continue to grow or at least lose significantly less.

Biggest online stores grow the most

The second example that reinforces this statement comes from e-commerce. An analysis of the 1,000 largest online stores by EHI and Statista showed that it is primarily the large stores that are recording the strongest growth, while the sales growth of the smaller online retailers in the second half of the ranking of the top 1,000 online stores is tending to decline. At the same time, the activities of retailers on marketplaces such as Marketplace Amazon or Ebay are increasing – from which the platforms are primarily benefiting.

Update as of 22.02.2021: The effect is intensified once again due to the Corona crisis.

From well-informed circles, one learns one or the other: e.g., that in e-commerce 30% growth for the “usual suspects” was easily possible. There are even companies that have grown by up to 50%, not in spite of Corona, but because of it.

CRM Market Power by Adobe Salesforce and Microsoft – The Natural Laws Behind the Development

This development is logical. As Cliqz explains in terms of GDPR, Google and other large AdTech companies have extensive resources to ensure compliance with all regulations. Smaller ad partners, on the other hand, are more likely to struggle to comply and prove it. Ergo, website operators prefer to part with smaller advertising partners to avoid risking penalties.

Incidentally, this effect is also known as the “winner-takes-it-all effect.” Success leads to more success, as Nils Warkentin wrote on Karrierebibel. Behind the phenomenon is the so-called “cumulative advantage.” Also interesting: “The best person doesn’t have such a big advantage because he was many times better than his competitors from the start.” Rather, it can be a small advantage at the beginning, but one that is used and built upon day after day, week after week, year after year.

However, ever greater growth, taken as a whole, is not an advantage. After all, size becomes unmanageable at some point. Monocultures develop, for example. As described in the article “The law of necessary diversity also applies to corporate cultures,” these often fall ill. In relation to ever-larger companies, this means: Whether in acquisitions or the legally compliant implementation of the GDPR – they are mostly concerned with themselves – less with the customers. And at some point, this “lame” company feels the pressure to change. It buys a small competitor from the market, integrates its product into its main product and then defines it as the standard.

CRM market power through Adobe Salesforce and Microsoft – Every individual must rethink

Many only realize their error in thinking when the damage, e.g. a system-relevant size, has been reached or occurred. But it could be so simple – assuming a rethink on the part of politicians and individuals. As Cliqz explains, many things could be done better with the ePrivacy Regulation. And: “Ultimately, users should never rely solely on laws and regulations such as the GDPR to protect their privacy. Instead, they should become active themselves and consciously pay attention to whom they make their data available to.”


Note: This is a machine translation. It is neither 100% complete nor 100% correct. We can therefore not guarantee the result.


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