Sales of customer relationship management software rose dramatically in 2007, driven in part by the take-up of software-as-a-service (SaaS) offerings, according to analyst group Gartner.

Sales of CRM software totalled £4.1bn in 2007, Gartner said in a new report. That represents a 23 per cent increase from sales in 2006.

“The market was driven by greater contributions from emerging regions, continued rapid adoption of SaaS, and a continued focus on investments that promote customer retention and enhance the customer experience,” noted Sharon Mertz, Gartner research director, in a statement.

Emerging markets accounted for 15 per cent of CRM sales in 2007, while 53 per cent of sales were concentrated in the US and 32 per cent in Western Europe. Sales of CRM software increased by more than 40 per cent last year in the Middle East, Africa and Eastern Europe.

According to Gartner SAP continues to lead the market, accounting for a 25.4 per cent share. Oracle came in second place, claiming 16.3 per cent of sales.

SalesForce.com, which trailed Oracle in terms of market share, and Microsoft, which came fifth, experienced the highest growth amongst the top five CRM players, growing by 49.8 per cent and 88.6 per cent respectively.

Amdocs was the fourth most popular CRM firm with a 5.2 per cent take in the market.