Ask any market research group and they will tell you the same thing – the market for content management software is about to explode. Meta Group estimates a growth in sales to $10 billion in 2004, while rival Ovum is betting on an increase to more than $13 billion in the same period. Companies are quickly realizing that the up-front cost of buying a content management system is well worth the savings they will gain by managing content in-house.

Content Management Systems, known as CMS, are software programs that allow organizations to create, manage and publish data. Some systems are simple programs that facilitate changes through a straightforward HTML editor, creating pages that can then be uploaded to the site. Many vendors are developing fully functional administrative tools that allow non-technical staff to make changes in a word-processing interface hosted online. Content can be added or modified instantly, circumventing the time-consuming process of turning edits over to Web design firms that must delegate the work, make the changes and then contact the client for approval before upload.

Although effective content management systems can be quite expensive, in some cases costing hundreds of thousands of dollars, the benefits are often well worth the cost. In addition to instant updates, cutting out Web design firms means avoiding per hour fees and monthly retainers. In the long-term, this can be a substantial savings for companies that make extensive or frequent updates to online content. Many systems also facilitate the management of several websites, Intranets and databases through a single tool. Since these systems enable employees to make changes without HTML or programming expertise, they permit in-house Web maintenance to be done with minimal employee training and nominal long-term expense.

There are three main types of CMS suppliers in the market right now. Some companies have focused on CMS since their inception and specialize in custom development for clients. Other firms have e-commerce or merchant server software specialties but have expanded to meet the growing demand for content management tools. A third group is comprised of companies that began as document management software companies and have moved into Internet publishing. In addition to these groups, many other types of firms are seizing the opportunity to move into this growing market. Even Web design firms that provided the very maintenance services that are becoming obsolete are developing CMS programs for their clients.

The challenge faced by all of these firms is figuring out what to make and to whom to sell it. Most vendors have chosen one of two strategic approaches to developing CMS software. Suppliers either create simple, one-size fits all, off-the-shelf programs or they cater to large clients by developing complex, customized systems. However, the key to the market may lie in covering the middle ground. There are countless midsize companies that are looking for a way to manage their websites without spending a fortune. For these companies, off-the-shelf products may not be suitable for their individual needs, while highly customized solutions may be out of their price range.

Creating basic CMS software with custom modules for these mid-sized businesses may be the biggest opportunity in the market. Systems developed for this audience will most likely fall into the category of ‘enterprise content management,’ facilitating both intra-firewall document management and online publishing. The Bivings Group has found that developing a variety of modules that can be combined to suit each client’s needs is the most effective way to satisfy the midsize client market while keeping development costs down. Although this system has been very successful, it depends heavily on the ability of the client to define their specific business needs.

Content management systems are only a tool to help businesses manage their information; they are not the solution to managing it. Firms seeking to automate communications and publishing must look closely at their business processes before taking the plunge. This is especially true for midsize firms that may have more to lose than their peers. Plenty of huge companies can take a fistful from the money tree and many small companies will do just fine with a $200 CMS, but mid-size firms may need to make a substantial investment to purchase a system that suits their needs.

Businesses that are in the market for content management systems need to know exactly what they require for their specific purposes. This is becoming more complicated by rapid developments not only in CMS software, but also in technology in general. Firms must decide what content needs to be managed, how the content will be developed, approved and delivered, and what features they will need to meet their objectives. New questions about XML applications, multilingual capabilities, storage methods, integration and customization further complicate this important decision.

Instead of grabbing a product of the shelf or relying on vendors to know the organization, businesses must do their own research to ensure that the CMS fits -but if companies can clearly communicate their needs to CMS providers and vendors are responsive, everyone will benefit. Developers will find much needed revenue in a booming market and midsize firms will have an effective, and inexpensive, way to manage and publish information.