For many years, I've participated in Gartner CRM conferences, oftentimes as a speaker for them, sometimes as a guest and attendee and last yearI was at the conference as a thought-leader-under-contract so to speak for Sage. So, I've had the benefit of attending all the conferences from 2005 through now. I've listened to the keynotes, attended various tracks, spoke three years in a row as the Power Breakfast keynote, have had conversations with multiple Gartner analysts, a handful of whom I count amongst my actual friends, not just business acquaintances (especially Michael Maoz, who I think is a superstar analyst and even more important to me, someone I'm proud to call a great friend. I've conversed with many many many participants and I blab with a lot of the sponsors, most of whom I know as clients or in other capacities - having covered them myself for many years.
My conclusions in most of my prior posts on this particular conference over the years, were that Gartner didn't get it, or later on almost got it, but not quite. Last year, they regressed and held a conference that was universally (and a bit shockingly) panned for its attendance and content. But they've shown a truly admirable resiliency and a real humility when it came to rethinking what they had to do to make this conference a true success. And that they did. This was spectacular.
Two things I want to say about that. First, the resiliency. Several years ago I did a comparative post on Forrester's outlook and Gartner's outlook when it came to being willing to see and forecast to the changes that were going on in the world of business - i.e. the social customer etc. At the time, honestly, Forrester simply had a more clearly defined and what I saw as "better" meaning more accurate view of the business universe. But Gartner had guys like Michael Maoz five, six years ago seeing elements of the new social order and what he a bit later called the intent driven economy.
Now I look at Forrester and Gartner and Forrester has imploded and is nothing more than a shell of what it was. Exits of their most important analysts over the past year, leaving the highly capable but now lonely Bill Band as their only real voice in the CRM universe with a few others here and there. All in the all their social CRM perspective is weak to non-existent, diluting at the exact point that SCRM is one of the hottest topics in the business universe, with guys like Chris Brogan placing it among the top three 2010 trends. Sigh.
Gartner on the other hand is becoming immersed in an realistic way (note that highlighted phrase) in Social CRM with a sharp but self-acknowledged nascent understanding of what the space is and comprises. In fact, they see it as a billion dollar space in 2011, according the my other favorite Gartner whiz kid - Ed Thompson - who delivered the keynote on day 1 of the conference. Their willingness to acknowledge that their knowledge is nascent and incomplete is where the humility comes in.
A ThanksFirst though, before I get into the meat of this discussion which will include something about the SCRM Magic Quadrant, I want to precede it with a thank you. I was at this particular summit with Gartner as a speaker and proud to say I had a role in helping plan it - though of course a small role. I did a couple of events - one where I moderated a panel of stars - Brian Komar, Director of Interactive Marketing and CRM for the Center for American Progress (CAP); Heidi Tucker, the VP of Alliances for InsideView and finally, the ever popular Frank Eliason, Senior Director, National Customer Operations, Comcast. Awesome bunch, fabulous interactions with audience -with just short of 100% audience-driven questions. I then did a thing where Michael Maoz and I took the stage together (a dream thingee for me) and conversed about Social CRM to a full house I might add.
So I had fun. A lot o' good times.
So thank you, especially Juan Fernandez, who is the Events Manager for the CRM and other conferences at Gartner. Juan somehow manages to put together extraordinary events, pays attention to the individuals who make up the speakers, works with the individual attendees to help them get the most out of the events, coordinates all the logistics, handles the vendors/sponsors needs, troubleshoots and does it with a great deal of focus and grace. He is a kind person and that goes a long way to making these kinds of things be more than just a series of "things" but instead, as the sponsors all told me this year - it had a vibrancy and excitement that they didn't expect. Juan Fernandez is one of the main reasons that this event was the success it was.
Now on with the ShowOkay. Let's look at a few things. Gartner's current perspective, who was there and their outlook, and a pretty deep dive into the Gartner Social CRM Magic Quadrant. If I were to characterize the four in four words (in order) I'd say "great", "wow" “coolest” and "meh."
Gartner’s Current PerspectiveGartner to their credit is showing an incredible flexibility and humility when it comes to Social CRM. First, they are now behind the market where a year ago, that wasn’t exactly the case. They are predicting a $1 billion spend on what they define as that market (more on that in a bit) in 2011, which would put it at about 8% of the total CRM software market if they are seeing it as a subset of that. I’m unaware of whether or not they are or aren’t but will find that out and let you know via a tweet soon enough. Additionally they see SCRM as a defining framework for the market. They also see it (YESSS!) as evolutionary, not revolutionary. Meaning it’s not replacing CRM but its extending social capabilities into CRM. BTW, they are not having any difficulties using the word “social.” I say this because I’m seeing some feedback – as in the kind “Blackberry-next-to-speaker” feedback – noise – about the use of the word “social” because “we’ve always been social.” So what? That doesn’t mean we can’t use the word. Its used as a way of distinguishing changes in CRM that are due to changes in customer behavior and how the customer communicates. In fact, read Mitch Lieberman’s post on managing expectations for a good way to think about it.
What makes Gartner’s perspective on SCRM important is that they are market makers when it comes to customers’ thinking about what kind of business strategies to execute and what kind of software to implement. They don’t do much in between, honestly – the programmatic requirements of practitioners are left to consultants as the guidance counselors. But they are very important in the firmament of business when it comes to strategies and software. So, with their buy in, they validate the market. Even though SCRM wasn’t by any means the sole theme of the conference, it was the predominant theme. Ed Thompson in his opening keynote set the tone. He was able to clearly get across that traditional CRM has stabilized as a successful strategy and implementation:
- Most CRM projects are delivered on time and on budget
- Organizational CRM goals have stabilized and thus fostered increased revenue and increased loyalty
- Retaining customers and CRM are top objectives in 2010 for CEOs
- Attracting and retaining customers, innovation, targeting customers and markets, expanding customer relationships are the top CIO concerns in 2010
- Current market size for CRM software vendors in 2010 is $9.38 billion
. In other words, if we take all of this into account, CRM is a robust market and a strategic imperative for most enterprises. The weak points still remain SFA failures which of the three pillars have the highest rate; the ability to create the appropriate metrics to measure customer impact on the business; and organizational, not technological miscues. One interesting sidenote was that SAP owns the largest share of the market currently. Here’s the Big 4 breakdown in percentages:SAP 22.3%, Oracle 16.0%, MSFT 6.3%, SFDC 12.5% of mkt
- SAP – 22.3%
- Oracle 16.0%
- salesforce.com 12.5%
- Microsoft 6.3%
That’s all well and good when it comes to CRM, but what about Social CRM? That’s where the marked departure from the previous conferences and most Gartner writings occurred. Before I say that, though I do want to make sure that you do understand that some of the Gartner analysts like Michael Maoz were writing about the social stuff six, seven years ago. Michael was talking communities and then later on what he called the intent-driven business – a social enterprise – a long time ago. Guys like Scott Nelson were using the social channels to communicate (like Twitter) in 2007 or so. So, I’m not trying to imply that they were either ignorant or blind to the transformation of business. But SCRM or social business wasn’t part of the interwoven world view of the company – and thus, not part of the culture – and that makes all the difference in the world. Michael and Scott in their respective ways, were lone wolves in a button down environment trying to live in a world with shirt buttons open.
But this year shows why a good analyst organization is good. They’ve recognized the market, done their due diligence, put aside any corporate ego about their non-involvement in the past – and done some sterling a.k.a. excellent work on looking on moving the market itself. And done that.
What Ed T., who BTW, is a fantastic speaker (one year I came in #2 as a speaker at the Gartner CRM Conference – being a New Yorker, I didn’t say “wow that’s great!” I said, “who beat me?” Ed Thompson. No shame there.), emphasized is that especially in customer service, which goes to my thinking on the changing nature of customer service as chief pillar and wrapper for customer-facing business activity, SCRM is becoming important. Ed made it as clear as it could be made (paraphrasing):
“IT is being driven by consumer technologies now. Social computing on the rise. We are socially connected and digitally enabled. The power of consumers rising thru their ability to choose.The social customer rules the business landscape.”
I couldn't agree more.
Ed also made another cogent and important point that I’ve been addressing for a long time (see chapter on Privacy in the digital chapters of CRM at the Speed of Light’s 4th edition available for free online):
“If it is digital, it discoverable, Privacy is dead, get used to it. If you don’t want to share it, don't type it.”
While that may be overdramatic, it goes to an important part of how we now communicate when it comes to online and the scalable nature of the Social Web. What you say online remains online and available forever via the archived web and companies like Facebook, with or without your permission, ethical or not, use your activities as assets in their business. Meaning that they reveal information about you to third parties routinely. So that if you give the information out, either it will be provided or found. So Gartner’s point here is also well taken and a cautionary on what might be partially at least the dark side of SCRM and the Social Web. Minimally it means the rules of engagement changed with the change in customer behavior. And it certainly meant a change in approach and attitude and belief for Gartner – a most welcome one, I might add (and I might….).
The Audience and the VendorsThis drive toward social permeated the conference and indicative of that is that the session when the Social CRM Magic Quadrant was revealed came up it was packed. At 8am in the morning the final day, when Michael Maoz and I did a joint conversation on Social CRM – where is it and where was it going – it was packed – with tired people, but it was packed. The buzz around the conference was social, social and social even though the discussions on business processes, master data management, mobile applications, etc. was there and the traditional stuff wasn’t missed. Social was the clearly the TMZ-worthy buzz. (Interesting discussion a few months ago on in the NY Times the use of the word “social” by itself as a derivative.This has absolutely nothing to do with this post. I was just thinking about it and thought you’d like to know, apropos of nothing.). What was also important to recognize is that this was a CRM crowd, not a social crowd – which is a markedly distinct group. They understand operational business, but as folks from Jive and Lithium both told me, they had a lot of interest from people who admittedly knew little about social.
The presentations drew the crowd when they focused on social or something labeled 2.0. For example, my brother Bob, who is one of the leading experts on the confluence between SCRM and Government 2.0 – especially the Virtual USA project, fascinated the audience with the way that the state, local, and federal agencies are collaborating among themselves and with their constituents to deal with emergency management and first response in crises. He was matter of fact, the audience was blown away.
What it reflects is twofold. The socialization of the population through the transformation of communications, while not engaging the majority of the world's populace, is impacting and engaging the most influential portions of it - and those that in business drive buying decisions - among their friends and with their companies. Gartner is not only recognizing that but embracing it - a long way from their past stance - and by doing so, moving the needle forward.
This leads me to a slightly more difficult part - my take on the SCRM Magic Quadrant that Gartner released at the conference. First a classic disclaimer - Jive, Lithium and Gartner have been clients in one way or the other recently. You'll see why that needs mention (though has no bearing) in a moment.
The Social CRM Magic QuadrantOkay, deep breath. I'm on the board and about to do a full gainer with a twist double loop backspin with a 9.7 degree of difficulty - that's the kind of dive I'm making into this.
OverviewIn the last year or so, there have been several seminal or at least important steps when it comes to establishing the business science of SCRM. For reasons unbeknownst to me, but appreciated certainly, my post on "A Stake in the Ground" as been accepted as the industry standard for the time being. Then the Altimeter Group's Use Cases for Social CRM was the next key event in the process. The third is the Gartner SCRM Magic Quadrant - because, for the first time, a significant industry force was willing to put forward a technology based matrix for how the vendor part of the industry was shaping up. So we had definition, use cases and vendors all beginning to be aligned. What kind of endeared Gartner to me on this one is that they admitted it was a work in progress - and are not trying to be definitive. But their publication of the document and their willingness to take some risk here, puts pieces into place that add to the total matrices that are needed to define the industry - and validates the space even more - as it pushes into the mainstream. SCRM is no longer a matter for the colonies in outer space - its now at HQ - a mainstream discussion with a billion dollar market in 2011. Gartner, in the report states there are over 100 vendors that they call SCRM right now (hopefully, their validation of the name and the acronym will more or less end the discussions on what to call it.).
The Criteria and DefinitionNeedless to say the criteria pretty much drive the answers - meaning those who show up in one of the MQ sectors. So I'm going to take a bit of a look at the criteria and its here that I start to have a few differences.
THEIR TAKE: First, they identify SCRM vendors "starting out" in 4 different ways:
- Hosting/supporting branded or private label communities (e.g. Jive, Lithium)
- "Monitoring, listening to and surveying private label or independent social networks" (e.g. Radian6) - this one puzzled me no end - why limit the monitoring to that. For example, Radian6 monitors up to 200 million blogs that don't fit that criteria. The market size for social media monitoring is 170 products. The limit makes little sense to me. I don't think any of the products limit themselves to social networks either. Also, if the market for SCRM is 100 products, and only some of them are SCRM, what distinguished the SCRM SMMs from the non-believers?
- Facilitating sharing of B2B or B2C contacts through use of an internal community. I honestly am not sure what that means exactly. Or why that's a big starting point for SCRM? Does that mean a Jigsaw like company, perhaps? If so, the ones I know in this particular space are...Jigsaw - and that's it. Not saying there aren't any others, but....
- Community product reviews to facilitate online sales. (e.g. GlobalPark) - why is this a starting point, exactly?
They then go on to make the following point "Vendors that can assemble the full social CRM suite and make progress in two or more of the areas (Author's note: ????) will reap the biggest success. Gartner believes that by year-end 2011, these disparate approaches will combine to form social CRM suites" and by 2014, they will be integrated into traditional CRM vendors such as... all the ones that you can guess - and Amdocs (another big puzzle to me on this one). The other factors over time that will differentiate the SCRM vendors include the ability to interoperate between public and private socnets and communities; the ability to integrate processes with traditional, operational CRM apps; proof of ROI; partnerships with global integrators.
MY TAKE ON THIS:
I have a much more narrow definition of what it takes to be a social CRM vendor - and it tends to be where they see it "reaping the biggest success." That means from my standpoint, the integration with traditional operational CRM is critical - since I (and Gartner) see SCRM as an extension of CRM - not a replacement. What they call social CRM vendors, I can't say that I do. My loosest interpretation of what would make one a market leader now in Social CRM is that they have the ability to integrate with traditional operational CRM NOW and that they show significant proof of that capability. This leads me to differ with them on their notion that by year end 2011 - "these disparate approaches will combine to form social CRM suites" since I don't see any social vendor with the interest in creating the operational marketing, sales, and customer service functionality for their native apps - nor should they. Integration is fine for them. In fact, at the moment, the only vendor I see anywhere who seems to be on the "build it themselves" path is salesforce.com with their recent release of Chatter (which I only like as a layer in force.com). I also think that if the traditional vendors wait until 2014 to fully and seamlessly integrate the social capabilities to their traditional suites, they are waiting way too long - and I think the vendors know that.
The biggest difference for me with Gartner is that I think for a technology company to lay claim to SCRM at all, the ability to integrate with operational CRM has a much greater importance than Gartner gives it - though they give it some due. That is a high priority in distinguishing a product that provides social channel accessibility e.g. a community or a monitoring product that reports - and one that supports customer insights tied to the analytic and operational capabilities of business. That said, I can see the reasoning of Gartner, because the social apps are used in support of some form of customer service - in the broadest sense.
THEIR TAKE ON:
They have their own Gartner-inclusion criteria that is indisputable because its their requirements for how they evaluate - a number of client references for example, or a revenue minimum. They also have SCRM application criteria including measurable use cases and destinations like communities for customers to participate in interactions and business rules, workflows etc. that support those communities. Finally, they have a criterion that calls for support for at least one sales, marketing or customer service process and ability to incorporate findings or solutions into CRM operations. There are others but these are important.
MY TAKE ON THIS:
I have no beef with most of those criteria. Gartner can set their own standards for inclusion - and that's their prerogative. I'm a little unclear on the difference between the ability to incorporate stuff into CRM operations and the support for at least one sales, marketing or customer service operation. Honestly, I'm hard pressed to see how several of the companies on that list met that criteria or the one that calls for business rules and workflow. On the other hand, I do see companies who fit this well. For example, Lithium strongly supports multiple customer service processes - one of the best examples for that is their ACT! Community - an outstanding example of a community done right. Plus they had a relationship with RightNow (until RightNow bought HiveLive) that indicates an API that allows good integration. But, without getting into names, I know that several of the companies in the MQ would be stretching it to say they met the Gartner SCRM apps criteria.
The Leaders and the Overall ListTHEIR TAKE:
This part is not too complicated. Jive and Lithium were in the world famed Upper Right Leaders Quadrant - they won - and a HUGE congrats to them for that! If you look over the rest of the chart, a couple of things stand out. With the exception of salesforce.com which is in the Visionary segment, the "traditional" CRM vendors are all in varying spots in the Niche player category - with RightNow, who of course, has been emphasizing their CX customer experience platform more than anything, closest to breakout of the Niche square. Oracle CRM on Demand is in this lower left segment too. Notable for their absence SAP and Microsoft. NetSuite, while not there, really hasn't concentrated on SCRM so that's no surprise. But the rest of the niche is all over the map - which is just a way of saying that they carry out specific functions - so Radian6 and InsideView are in the niche areas - because they focus on monitoring and do it well.
MY TAKE ON THIS:
I truly love Jive and Lithium. They are among my favorite companies - with superb products, visionary thinking, enthusiasm and passion and a track record of incredible success - as community platforms. They are the best in the market as of now. But are they SCRM leaders? By Gartner's standards, I can see it because they do meet Gartner's criteria. By my standards, as fabulous as they are, - and they are -Nope. I don't think so. Look, I keynoted Lithium's LINC conference and I've been working with Jive in multiple ways to help them as best I can. So, I will reiterate, I really, really like these companies. But I don't think given my perspective on what SCRM is - with an emphasis on the requirement to integrate (and show the integration in multiple instances) with traditional CRM - that there is a market leader in the space.
Does that ultimately matter? Honestly, no. If any of the vendors on the SCRM MQ are valuable to a business for what they can do, rather than what they are called, then they are valuable. Ultimately, its a vendor's value in providing the answer to the questions that a business might have or as my co-creation/innovation buds might say - do the job that the business is asking them to. In that case, whether they are a leader, a visionary, a niche player, a challenger or not even on the grid, doesn't really matter, now does it?
In SumThis was a major comeback as a conference for Gartner. But far more importantly, this was a benchmark event for the SCRM and CRM worlds with a confluence of great content, high level practitioners of influence, vendors from both the social and CRM worlds, key thought leaders, even beyond Gartner's own; and a risky, flawed, but major step for the industry with the release of the SCRM Magic Quadrant. Kudos for the boldness and the attempt on the MQ but there is work to be done there.
There was one thing they did really poorly and they need to do next time around. This is not meant to be funny. They had no Gartner tweeters tweeting the conference consistently. The analysts may be busy but that didn't stop a non-analyst or three from being assigned to tweet at the conferences. Twitter for the purposes of broadcast is now an important and can't-be-ignored social channel. When SCRM is a key topic and something important in that field is coming down - well, Gartner, next time around, get better at this. This is an omission.
However, all in all, Gartner has validated Social CRM as mainstream and at the same time, shown themselves to be influential, resilient and something I never thought I would say, humble.
Yo, Gartner! You rocked!
Other Gartner Customer 360 CoverageSee:
<ul><li>Attensity Blog - Maria Ogneva</li><li>Lithium Lithosphere - Phil Soffer</li> <li>Sword Ciboodle Blog - Clare Dorrian</li>SearchCRM Voice of CRM Blog - Barney Beal</li></ul><p>There is other coverage I would imagine, but honestly, I'm tired of writing this post. It needs to be up.