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G00251937 Magic Quadrant for the CRM Customer Engagement Center Published: 13 May 2013 Analyst(s): Michael Maoz The blend of social media engagement with CRM software is evolving the contact center into the customer engagement center. Gartner's 2013 CRM customer engagement center Magic Quadrant looks at vendors that respond to the challenge of "any channel" customer service engagement. Strategic Planning Assumption By 2015, organizations that have not embraced the concept of the customer engagement center will lose customers to competitors that have. Market Definition/Description The CRM customer engagement center (CEC) refers to a logical set of technologies and business applications that are engineered to provide customer service and support, regardless of the interaction (or engagement) channel. The goal of the CEC is not only to provide service to customers as they move among communications channels — including social media — while retaining the customers' context, but also to deliver the appropriate business rule to determine the next best action, information or process with which to engage the customers. For the past 12 years, Gartner referred to CECs as customer service contact centers. As the need to engage customers and prospects on new channels such as social media has expanded, we have evolved the term "contact center" to "customer engagement center," and thus, we have renamed our Magic Quadrant (see "Magic Quadrant for CRM Customer Service Contact Centers," published in April 2012). At their most basic level, CRM CEC applications handle a wide range of tasks, including engaging customers and prospects across multiple channels, and handling trouble ticketing, order management, case management, advisory services, problem diagnostics and resolution, account management, and returns management. The focus of the engagement might also be for government, nonprofits and higher education, in which the target not always is customers, but could also be students or citizens. This may also involve knowledge-enabled resolution (such as advanced search tools), process-centric/enabled service resolution, community management, and management and service analytics dashboards.

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  • G00251937

    Magic Quadrant for the CRM CustomerEngagement CenterPublished: 13 May 2013

    Analyst(s): Michael Maoz

    The blend of social media engagement with CRM software is evolving thecontact center into the customer engagement center. Gartner's 2013 CRMcustomer engagement center Magic Quadrant looks at vendors thatrespond to the challenge of "any channel" customer service engagement.

    Strategic Planning AssumptionBy 2015, organizations that have not embraced the concept of the customer engagement centerwill lose customers to competitors that have.

    Market Definition/DescriptionThe CRM customer engagement center (CEC) refers to a logical set of technologies and businessapplications that are engineered to provide customer service and support, regardless of theinteraction (or engagement) channel. The goal of the CEC is not only to provide service tocustomers as they move among communications channels including social media whileretaining the customers' context, but also to deliver the appropriate business rule to determine thenext best action, information or process with which to engage the customers.

    For the past 12 years, Gartner referred to CECs as customer service contact centers. As the need toengage customers and prospects on new channels such as social media has expanded, we haveevolved the term "contact center" to "customer engagement center," and thus, we have renamedour Magic Quadrant (see "Magic Quadrant for CRM Customer Service Contact Centers," publishedin April 2012).

    At their most basic level, CRM CEC applications handle a wide range of tasks, including engagingcustomers and prospects across multiple channels, and handling trouble ticketing, ordermanagement, case management, advisory services, problem diagnostics and resolution, accountmanagement, and returns management. The focus of the engagement might also be forgovernment, nonprofits and higher education, in which the target not always is customers, butcould also be students or citizens. This may also involve knowledge-enabled resolution (such asadvanced search tools), process-centric/enabled service resolution, community management, andmanagement and service analytics dashboards.

  • CRM Business Applications for Customer Service Engagement

    A complete CEC solution, although not available from a single vendor, will contain all of thefollowing functional components:

    Customer service and support (CSS) problem management, trouble ticketing and casemanagement

    Knowledgebase solutions, content management and advanced desktop search

    Real-time analytics/decision support

    Social media engagement for customer service

    In-line support of mobile consumers

    Peer-to-peer (community/blog/forum) support and/or integration

    CRM databases for account/contact/offer information

    Desktop integration with telephony, co-browsing, mobile and Web extension of the solution toonline communities interested in peer-to-peer (P2P) collaboration management

    Social service process analysis

    Real-time feedback and surveys

    The ability to connect to remote sensors embedded in equipment such as consumer electronics

    (For a breakdown on the weightings applied for the evaluation, see "Social Media for CRM WillForce a Shift From Contact Centers to Customer Engagement Centers.")

    The agent must be able to support the customer, whether the customer is on a website or a mobiledevice, at a kiosk or in a vehicle, on Facebook or on Twitter, or in a community or a blogosphere.This means:

    The agent sees what the customer sees.

    The agent knows the path the customer has taken before the voice conversation takes place(that is, he or she knows the communication context of the interaction).

    The agent has the tools to solve the customer's problem or address the customer's issue froma remote location.

    The CEC needs to send out proactive, automated alerts. For example, when the status in a back-end system changes to one of which the customer needs to be aware (such as a bank balance,credit card fraud, flight delays, available upgrades, price range reached, a special offer on cars orinsurance policy exceptions), an alert is sent to one or several devices until the customer respondsthat he or she has received the notification.

    The application must contain business rules for complex entities, such as contact, enterprise,subsidiary or partner, and the workflow processes to route a case, opportunity or order based onthe rule set for the specific relationship. Optionally, the application should be available as a

    Page 2 of 28 Gartner, Inc. | G00251937

  • subscription service in a cloud-architected model for all relevant industries. (Some industries, suchas telecommunications and federal government agencies, may not be ready for this model, and on-premises software or private cloud may be preferred.)

    A case may be routed from one department to another, depending on type. The case can link to allinteractions across channels, whether email, online, SMS or a phone call. An application supportsmultiple languages simultaneously. In some situations, real-time decision support is important.Multiple back-end systems synchronize using their own rules for example, credit card fraud;telecommunications-specific functions, such as telecommunications billing, service and resourcemanagement; product life cycle management; digital content; and advertising bundling andintegrated order management.

    Magic QuadrantFigure 1. Magic Quadrant for the CRM Customer Engagement Center

    Source: Gartner (May 2013)

    Gartner, Inc. | G00251937 Page 3 of 28

  • Vendor Strengths and Cautions

    Amdocs

    Amdocs is a profitable company with more than $3.25 billion in sales in 2012. It has acomprehensive set of software and services to communications service providers (CSPs), in termsof telecommunications, media and satellite. In the CEC market, Amdocs is a niche provider, with abusiness and vision directed at customer service contact centers and the customer experience toits target industry.

    Strengths

    In the telecommunications industry, Amdocs has the advantage of a comprehensive set ofproducts as part of the Customer Management Version 8.x and new CM9, ranging from anorder management and billing platform, customer service functionality for the agent desktop,device management, a catalog and retail interaction manager, together with libraries ofinteraction flows.

    Amdocs is a strong and profitable company, with customers and professional servicesresources in every major geographic location.

    For prospects with deployed Amdocs assets, the company offers strong insight on the future ofthe telecommunications customer. It understands retail operations and the contact center intelecommunications and mobile, and it has good integrated billing capabilities.

    Amdocs' consulting has strong experience in project management, best practices and keyperformance indicator mapping, and the support organization receives high marks.

    Cautions

    References have pointed to gaps in the agent desktop product, including knowledgemanagement, reporting/analytics and industry-specific capabilities outside of CSPs(telecommunications). Look to partners to close functional gaps.

    Amdocs has not kept pace with the needs of clients in the areas of cloud-based systems(although it does offer a managed service option), sentiment analysis, online communities orsocial media engagement. Some recent partnership strategies have improved its abilities. Anew capability for real-time decision making is emerging.

    Amdocs is not recommended for customer service contact center shortlists across industriesother than telecommunications, although it may be appropriate for consideration on longlists.

    Despite Amdocs articulating leading ideas for customer experience, Amdocs references havenot expressed the view that it is best of breed in areas such as chat, knowledge management,co-browsing and virtual assistants.

    Amdocs has limited traction in growing third-party external service providers (ESPs) forconsulting and implementation services.

    Page 4 of 28 Gartner, Inc. | G00251937

  • Astute Solutions

    Astute Solutions is a small (estimated revenue of less than $20 million in 2012) niche provider ofcloud-based (software as a service [SaaS]) and on-premises customer service functionality,primarily to the consumer affairs market and primarily in the U.S. and the U.K.

    Strengths

    Astute has continued to develop its products to meet changing customer demand, mostrecently with more-advanced cloud capabilities and improved knowledge management. It alsohas a clean and useful social product for CRM Social Relationship Management (SRM). Ithas a good natural-language processing tool that is useful for customer sentiment analysis.

    Astute's ePowerCenter version 8.x is available either on-premises or in a cloud subscriptionmodel, primarily in small and midsize customer service centers (15 to 100 agents). Through anacquisition, it can now offer a cloud-based computer telephony integration (CTI) component inaddition to extending the application to mobile devices.

    The vendor has strong knowledge of and functionality for customer service processes inindustries such as restaurants, hospitality, consumer goods and retail (nonbanking or otherfinancial services), as well as best-of-breed capabilities, such as Facebook-based chat.

    Cautions

    Astute is a small company (fewer than 100 employees), and it has a limited software partnerecosystem and a small integrator/consultancy partner practice. In 2012, there was no smalldegree of reorganization in sales and marketing.

    References point out customer support issues outside of the United States, although Astute hasmoved to 24/7 global support.

    The product requires improvement to the configuration module and other components inmulticountry/multiclient operations environments that require large data volumes. In the designphase, new customers need to think through their requirements, rather than re-engineering thesystem once it has been developed.

    The system is rarely deployed in large-scale, multichannel operations of large, distributedinternational service environments.

    Kana

    Kana has one line of business focused on the public sector, another on midsize- to large-enterprisecustomer service and another focused on customers looking for a cloud-based product centered onthe midmarket. This multipronged strategy will continue to limit its leadership potential in theemerging CEC market. Our assessment of Kana replaces the Sword Ciboodle assessment becauseCiboodle was purchased by Kana in 2012. See "Kana Buys Ciboodle for Improved CustomerService and Social CRM Reach" for a summary of the Kana acquisition of the Ciboodle product.

    Gartner, Inc. | G00251937 Page 5 of 28

  • Strengths

    The combined assets of Kana could, over time, yield to the deployment of best-in-class CECs.The Kana Enterprise, with an agent desktop, knowledge, social and mobile components, givesthe company good material to scale an integrated product.

    Management has invested in a broad set of customer service and support tools to reach manyconstituencies: public sector, midsize businesses, the traditional customer servicerepresentative and those looking for social media tools.

    The product can be configured for multiple user roles, which speeds the average handling timefor a task, streamlines/shortens the training period and makes new processes easier tointroduce.

    Cautions

    Kana requires another 12 months to sharpen its marketing skills and develop third-partypartners to sell and deploy its products. Selling multiple solutions within four product familieshas diminished Kana's ability to excel in the core CSS area in particular, for deploying whatwould be considered a CEC.

    Kana Enterprise is not for complete customer service in a multitenant SaaS platform model.

    Despite Kana demonstrating good social engagement tools, we have not seen large or complexdeployments tied into a customer service engagement center.

    Prospects should look for the local availability of professional services personnel for the specificproduct set that they wish to deploy, backed by references.

    Lithium Technologies

    Lithium Technologies was founded in 2001 and is dedicated to helping organizations engagecustomers on social media channels. It has raised almost $100 million during the past 12 years, andit has used it to build a broad cloud-based platform of products to understand, support andimprove the online customer experience. Its offering is not a traditional customer service CRMsystem. It is because of its strong focus on customer engagement on social channels, whileconnecting these interactions (as necessary) to a broader CRM initiative or process, that Lithium isincluded in the CEC Magic Quadrant.

    Strengths

    Lithium has a very strong community platform, as well as a social moderation tool, which allowssupport organizations to both support online user communities and engage those customers.

    The tool easily integrates with other (non-Lithium) CRM customer service systems, allowing abusiness to focus on the emerging task of better engaging with customers on social mediachannels.

    Page 6 of 28 Gartner, Inc. | G00251937

  • Lithium provides good professional services for setup, advice on creating social mediaengagement teams (a unique value-add is gamification techniques), and ongoing analytics onthe progress and effectiveness of the support organization engaging on social media.

    Lithium offers additional tools such as a knowledgebase (Lithium Tribal Knowledge Base) and amodule to interact with clients on social media (Lithium Q&A), as well as a mobile application.The Private Support Manager module allows an agent to continue a conversation that beginsinside a public area, such as an online community, and continues into a one-on-oneconversation, whereby more corporate information about the customer can be brought to bearon how to proceed with the client.

    Cautions

    Lithium's system is not a replacement for a traditional CRM system, in the sense that it lacks acustomer master and must link to the systems where the customer information and otherbusiness rules exist.

    Industries such as health insurance, telecommunications, governments, universities and mostother industries should think of Lithium's system as part of an augmentation strategy to deepencustomer engagement, versus a replacement for a CRM system.

    As a small vendor, with limited global consultancy relationships and a SaaS subscription model,its reach to assist prospects and customers in all geographies and languages needs to becarefully investigated.

    Microsoft

    Microsoft Dynamics CRM for CSS continues to be used primarily for on-premises deployments andin nontraditional customer service contact environments, where the real value may be in supportinga customer request for information, or the needs of students, citizens or government officials tointeract with other people. There are many scenarios across industries (examples are government,healthcare, higher education, real estate and retailing), in which the flexibility of the system tosupport a range of interactions makes it a good shortlist product. Microsoft has not been able toprovide Gartner with complex and scalable examples of the cloud-based delivery model of theproduct for CECs.

    Strengths

    The Microsoft Dynamics CRM product has good overall attributes, such as built-in workflows, ahighly regarded Software Development Kit (SDK), good customization capabilities, a growingend-user community contributing ideas, and multichannel process integration.

    The product blends sales, service and marketing, as well as tightly integrates with otherMicrosoft assets, such as Office and SharePoint, and offers the promise of deeper integration ofLync and Skype.

    Gartner, Inc. | G00251937 Page 7 of 28

  • There has been continued improvement of the user interface in particular, screen layout,active fields, intuitive scripting and reduced keystrokes to accomplish standard tasks.

    The company has the benefits of solid financial standing and commitment to the CRM productline, global data centers, sales, marketing and service, access to a deep bench of developerresources, and global deployment partners.

    Cautions

    Clients mention as a concern the lack of trained professional services partners that understandbest-in-class customer service centers and how to configure Microsoft Dynamics CRM toachieve this.

    Outside of some areas of the public sector, the product does not provide industry templatesthat deliver a significant amount of functionality and process flow out of the box. Prospectsshould look to partners to deliver industry capabilities.

    For an organization with complex customer service center requirements, on-premises is theonly proven option today. Also, arriving at an accurate sense of infrastructure requirements ischallenging.

    Microsoft has not briefed Gartner on direct support capabilities. For third-party support,prospects should evaluate the local partner's capabilities in providing support.

    A multitenant cloud version of the customer service product for large and globally distributedCECs has not been demonstrated.

    The integration of social media engagement components has not been seen, althoughMicrosoft's acquisition of Netbreeze is a welcome sign of awareness of the need.

    Nice Systems

    Nice Systems continues to improve its messaging and experience around driving insightfulcustomer interactions. Its set of customer support functionality includes next-best-action, cross-channel interaction, process automation and guidance, interaction analytics, and compliance andrecording tools. It is a nontraditional provider of CEC, in that it does not own the customer record.Nice's tools are more of a complementary offering, often making it a complicated purchase decisionfor customer service managers. Nice offerings provide the agent with actionable information in realtime.

    Strengths

    Nice's Real-Time Impact (RTI) product helps with decisioning and is useful for customer serviceorganizations tasked with upselling/cross-selling during inbound interactions.

    The integration of real-time feedback and the advances in support of the mobile customer,together with a partnership with Amdocs, are giving Nice not only greater appeal to prospects,but also greater reach.

    Page 8 of 28 Gartner, Inc. | G00251937

  • References cite the ease with which information and data from multiple systems can beassembled and the workflows created to drive the customer dialogue.

    The integration of RTI with the rest of the vendor's assets for recording, agent training,governance, analytics and back-office workflow support creates good synergies for prospectsowning other Nice products.

    Cautions

    The company's success in markets outside of the customer service agent world has inhibited afocus on deploying more (and better trained and incentivized) sales teams globally in this area.

    Not all organizations find the methodology of the Nice professional services group intuitive oreasy to follow. The company can be flexible, although it requires some persistence.

    Nice does not spend sufficient energy focused on the emerging need for customer engagementby service agents on social media channels, such as Facebook, Twitter and user communities.

    There is no multitenant cloud version of the core RTI product.

    Pricing policies are not clear and explicit.

    Oracle (Siebel)

    Seven years after Oracle acquired Siebel Systems, the Siebel Contact Center and Service productcontinues to be sold, maintained and modernized, albeit not rearchitected in a SaaS/cloudmultitenant model. It has broad functional coverage and a diminished partner ecosystem from itspeak (in regard to the numbers of engaged professionals on new projects), yet it has areas of deepindustry expertise. It remains a standard for large-scale call/contact centers looking for scalabilityand access to a global pool of third-party professional services, and with an inclination for theOracle product line.

    Strengths

    Siebel remains the only large-scale customer service contact center product deployed globallyby large enterprises in 2013 across multiple business-to-business (B2B) and business-to-consumer (B2C) industries.

    The new Siebel Open UI on versions 8.1.1.x and 8.2.2.x when referenceable (Gartner expectsthis to be by the end of 2013) will introduce a much-improved user experience. There areapplication limitations that we believe are due to the nature of Internet Explorer, rather than anissue with Siebel.

    The acquisitions and native developments that are a part of the Oracle Social RelationshipManagement product lines will give Siebel greater capabilities for social media managementwhen referenceable on the Siebel platform.

    The product line has global software support and distribution, and a global presence ofprofessional services for multiple industries.

    Gartner, Inc. | G00251937 Page 9 of 28

  • Oracle continues to fund enhancements to the v.8.1.x and v.8.2.x product lines, as well as isextending integration in areas such as knowledge management, marketing, real-timedecisioning, workflow and policy administration. Upcoming agile development capabilities anda better user interface will energize the product.

    Cautions

    End users continue to find Siebel nonintuitive and the interface outdated for the currentgeneration of customer service agents. The UI changes are underway, and this needs to beaccompanied (for many of their clients) with deeper and simpler Microsoft Outlook integration(unless clients have purchased the Oracle product Siebel CRM Desktop).

    The product is neither best-in-class for mobile consumers wanting in-line support, nor best-in-class as a peer-to-peer community capability tightly connected to the customer serviceprocess. We have not seen the system providing an advanced social media managementcapability.

    Siebel is an on-premises software product, and there are no plans to rearchitect it to deploywith a subscription cloud product.

    Before making a decision for Siebel Contact Center and Service in their industry andgeography, prospects should perform reference checks of similar businesses that havedeployed the prospects' version of the product in the past 15 months to ascertain that thesoftware version has local professional resources to assist with the deployment. Oracle doesoffer customers the option of having the application managed for them as a private clouddeployment.

    Non-Oracle customers running B2B customer service or technical support centers may findSiebel Contact Center and Service either too functionally rich or costly (that is, if prospects havesimple requirements or a small number of users).

    Oracle (Service Cloud)

    Oracle Service Cloud is the customer service product acquired as a part of Oracle's RightNowTechnologies acquisition in early 2012. Its products continue to be integrated to parts of the Oracletechnology stack (see "Oracle to Acquire RightNow Technologies, Boost Cloud Portfolio"). It is thecloud offering for Oracle customers and prospects looking for a customer service solution with aSaaS subscription model.

    Strengths

    The acquisition of the product by Oracle will lead to greater scalability as the product leveragesOracle technologies. Oracle has multiple technologies that it can weave into the offering toaugment its capabilities.

    The system provides a cross-channel customer service functionality in the contact center andfor Web self-service.

    Page 10 of 28 Gartner, Inc. | G00251937

  • The system, delivered as a subscription service in a SaaS model, is straightforward to set upand configure, and it doesn't require heavy IT involvement.

    Oracle Service Cloud has strong industry representation in the high-tech industry; governmentagencies; retailers; education, travel and consumer electronics industries and branches oftelecommunications. It does not focus deeply on industry-specific processes for example,billing, price catalogs, order execution and underwriting.

    Cautions

    The functional components of the Oracle Service Cloud continue to undergo development, witha number of new add-ins to other Oracle products that may create complexity.

    Gartner has not seen large deployment teams or configuration teams from the largest systemintegrators and global consultancies, such as IBM, Accenture, Deloitte and Capgemini, for theCEC or traditional contact center desktop.

    During the transition period of RightNow Technologies into Oracle, Gartner has observed atheme of client inquiry about the turnover in the sales and professional services staff, as well asnew approaches to contracting, which requires an adjustment of expectations for existingcustomers of RightNow.

    Organizations leaning heavily in the direction of an all-Microsoft environment or a non-Oraclestack could face resistance from their IT organizations in regard to deepening the commitmentto the Oracle Service Cloud product.

    The product lacks an on-premises software model, and prospects will need to consider an on-premises Oracle product, such as Siebel, or another alternative.

    Parature

    Gartner has been following the U.S.-based and privately held Parature since 2003, just two yearsafter its founding, but it is only in 2013 that we see its product sufficiently robust, and corporateleadership and marketing sufficiently staffed, to place it in the Magic Quadrant. The company hassubtly shifted from selling to mostly small and midsize companies to selling to larger enterprises,albeit for smaller customer support organizations.

    Strengths

    Parature has a good management team that has scaled and improved its clout in the market,making it better able to build partnerships and assure prospects that it is a company withgrowth potential.

    The underlying product is very strong architecturally, built on a multitenant SaaS model. Foranalytics, it embeds Business Objects, and for companies looking to integrate the product intoa more complete CRM system, open APIs and partnerships with Microsoft Dynamics CRM andothers facilitate the integration.

    Gartner, Inc. | G00251937 Page 11 of 28

  • In the past two years, Parature has added good mobile capabilities, as well as social mediaengagement capabilities, to complement its problem resolution/trouble ticketing ability.

    The product is not limited to customer service for the support agent: It has modules forcustomer Web self-service and assisted service, as well as the ability to assist customersand/or prospects on social media channels.

    Cautions

    We would like to see larger and more-complex processes supported by the product, as well asa stronger presence outside of the United States.

    Parature is often not a substitute for a CRM suite, but rather, a complementary piece of anongoing sales, marketing and support initiative or system.

    The company is not well-known in most parts of the world, and to grow and deepen itspresence outside of the United States would require a much more serious investment of timeand money than the company has made to date.

    Pegasystems

    Pegasystems' license revenue grew approximately 18% in 2012, and its overall revenue reachedmore than $461 million, as it continues to exploit weaknesses in the software market for stable,modern solutions that incorporate business process management (BPM) as an integral part of thecustomer interaction.

    Strengths

    In the CRM space overall, Pegasystems has the best ability to model and predict a customer'sbehavior, create a workflow to support that customer, and to then associate the best action toexecute with (and for) the customer.

    The company has expanded the reach and depth of its professional service partner network, aswell as improved slightly in the area of partnerships with complementary vendors.

    The company delivers industry-specific best practices that we have evaluated, specifically forinsurance, healthcare and financial services, as well as prebuilt templates, which accelerateadoption.

    Pegasystems offers a highly scalable solution (1,000 or more concurrent users in an integratedenvironment with 99.95% uptime) and provides good support.

    Cautions

    The majority of IT-driven organizations do not favor Pegasystems' BPM, model-based approach(which is different from traditional software coding environments) for CEC Whereas industriessuch as insurance, healthcare and financial services are drawn to a product with a rule engineto resolve complexity, the product may not be the ideal choice for a shortlist in which there areinfrequent changes and low complexity.

    Page 12 of 28 Gartner, Inc. | G00251937

  • Pegasystems has less multi-industry experience outside North America and the U.K., andprospects should look for references with similar requirements.

    The company has more work to do to demonstrate its vision for mobile device support, and itdemonstrates a lack of commitment to customer engagement across social media channels.

    salesforce.com

    In 2012, salesforce.com's revenue grew 37% compared with the previous year and exceeded $2.25billion. Gartner estimates that 60% of new revenue came from the Service Cloud line, makingsalesforce.com the leading vendor, as measured by sales volume. However, it is not a leader incomplex B2C service centers and lags in certain aspects of best-of-breed social media engagementvendors.

    Strengths

    For B2B customer service operations, especially those with an established salesforce.compresence in the sales department, Service Cloud is recognized as a de facto shortlist productby most North American and Western European organizations. Several key new Service Cloudglobal deployments in B2B demonstrate the product's scalability.

    Key new customers both B2B and B2C have shown enough faith in the customer servicecontact center product to invest more than $10 million per year, as well as to retire homegrownsystems and/or systems from competitors that were at an end-of-life stage, and they considerthe salesforce.com application platform a strategic asset.

    The salesforce.com product for customer service has an excellent GUI, simple design tools,intuitive navigation and a good understanding of the importance of Web communities, althoughit is primarily partners that provide the Web community capability. There is good integration withback-end systems, such as Oracle ERP, SAP and telephony infrastructure.

    The added benefits of the customer portal, partner portal, social media monitoring and theSalesforce Ideas products draw customers to the Service Cloud.

    Cautions

    We have heard from Gartner clients, who have set up salesforce.com in multiple parts of theirorganization, that they have found themselves with multiple salesforce.com "orgs" (oftenthought of by users as "instances"). These instances are built with different workflows, tabs,custom objects and integration points that could need rationalizing. As a result, companiesmust develop a strategy that addresses if, when and how they should combine different orgs.

    Salesforce.com support does not demonstrate sufficient depth or consistency yet to deal with aglobal set of complex customer service environments in a timely manner (for example, thosethat require integrations and ongoing support of phone switches, email exchanges or back-endreal-time processing systems).

    Gartner, Inc. | G00251937 Page 13 of 28

  • References relate that product pricing for complex customer service environments is not astransparent as the published guidelines suggest.

    The vendor is largely unproved in large, complex, retail, B2C contact centers that is, large-scale, high-volume call centers where processes must be continually synchronized andmonitored, such as retail banking, loan origination, insurance policy administration, billprocessing and fraud management. Prospects should base decisions on proven references intheir industry and process model.

    The company has limited Asian, South American or Eastern European presence in larger-scale(more than 200 seats) customer service contact centers.

    The product's analytics capabilities and complex sentiment analysis functionality continue toimprove, but as with the support of customers on social channels such as Facebook andcommunities, need to be better.

    SAP

    The SAP Customer Service solution has the advantage that it is often bundled into a morecomprehensive SAP licensing deal, which makes it attractive to some clients. There is good growthof the reference base for B2B support, but far less evidence of large Customer Service deploymentsin B2C contact centers that require the support of high-volume, complex business processes, orcustomer engagement on social channels. Examples of segments that require this support includefinancial services, retail banking, retail mobile operators and healthcare.

    Strengths

    SAP is a strong and profitable company, mitigating the financial risks of making a large andongoing investment in the product.

    Once we have references who can validate the product for customer service, the current SAPEhP2 (also known as Enhancement Package 2) for SAP CRM 7.0 could provide useful customersupport capabilities.

    Capabilities for the customer engagement center should improve through the third quarter of2014 due to partnerships, such as with the social analytics vendor, NetBase. NetBase is at thefoundation of SAP Social Customer Engagement OnDemand. Prospects should look forreferences of the recently released SAP Jam, an enterprise social networking product releasedin November 2012.

    SAP's marketing of an integrated business application suite that supports end-to-end customerprocesses is compelling to clients from an IT and line-of-business perspective, because itsimplifies the application portfolio and promises better speed-to-solution delivery.

    Cautions

    SAP lags market requirements for a proven, scalable CEC application suite in all of itsgeographic regions. It is not expected to close this gap through 2014.

    Page 14 of 28 Gartner, Inc. | G00251937

  • We have yet to see deployments of the Customer Service solution for a complex environment ina multitenant cloud model.

    The company has not kept pace with market demand for advanced real-time decisioning/nextbest action solutions, content aggregation and delivery, or knowledge management. SAPclients looking for CSS solutions on the Web, mobile device, contact center or peer-to-peercommunities should not expect SAP to close this gap through 2014.

    Gartner has observed a significant leadership change in the CRM practice during the past 12months. This situation may account for the low awareness that Gartner clients reflect regardingthe key reasons for looking at an SAP offering for Customer Service solutions, particularly in thecontact center and evolving CEC. Until such time as SAP demonstrates the benefit of anintegrated all-SAP approach for CSS over best-of-breed choices outside SAP, it will continue tofall behind the competition.

    Zendesk

    Zendesk was founded only in 2007, yet it has grown and scaled the company to support more than30,000 customers across the world, 80% of which we estimate are small implementations of lessthan 20 users. It has raised almost $100 million in investment capital, and it may launch an initialpublic offering by the end of 2014. Zendesk's product has a cloud-based SaaS subscription modeland appeals primarily to organizations with small to midsize support organizations with simpleneeds. The company has several product packages, and we evaluated the Enterprise package forthis Magic Quadrant.

    Strengths

    The user interface is very well-designed and receives high praise from reference customers. Forsupervisors, in particular, many of the product features are also available on mobile devices,such as the Apple iPad.

    As a modern system with published interfaces, it is straightforward to integrate with socialmedia tools or telephony products. Because it is not a CRM system with an underlyingcustomer record, it often will integrate with other CRM packages, such as Microsoft DynamicsCRM.

    The SaaS architecture allows the product to be deployed in most key world markets.

    The company has a good presence for support and data in Western Europe and the UnitedStates, with additional facilities in Australia.

    Cautions

    We were unable to validate the solution for large and/or complex customer supportorganizations. Prospects should demand industry-, geography- and process-specific referencesbefore proceeding.

    Gartner, Inc. | G00251937 Page 15 of 28

  • References have found that creating business process rules or workflows for multiple usertypes or complex processes is difficult. Reporting and analytics are acceptable, althoughcustomers would like more-advanced features.

    The company will need to continue to reassure prospects and clients that an isolated securitybreach will not recur.

    Zendesk's customer support tool is not feature-rich. It assumes that the user group will use theopen APIs to integrate into the underlying systems that hold the rules for other customeractivities.

    The product is not a replacement for the core system of record but rather, it integrates to suchan ERP and CRM system.

    Vendors Added or Dropped

    We review and adjust our inclusion criteria for Magic Quadrants and MarketScopes as marketschange. As a result of these adjustments, the mix of vendors in any Magic Quadrant orMarketScope may change over time. A vendor appearing in a Magic Quadrant or MarketScope oneyear and not the next does not necessarily indicate that we have changed our opinion of thatvendor. This may be a reflection of a change in the market and, therefore, changed evaluationcriteria, or a change of focus by a vendor.

    Added

    The following vendors were added: Kana, Lithium Technologies, Parature and Zendesk.

    Oracle Service Cloud replaces Oracle RightNow CX Cloud Service.

    Dropped

    Sword Ciboodle was replaced by Kana as a result of its acquisition by Kana. Kana Enterprise is theproduct evaluated for this Magic Quadrant.

    Inclusion and Exclusion CriteriaWe look at the presence that a vendor has in the market and the momentum of its growth. A vendorwith stagnant sales or an ineffectual marketing organization should concern prospective buyers.Gartner's criteria specify that vendors should:

    Have a minimum of 15 customers using the software for CSS functionality in a contact center,including examples of social media integration

    Have at least five new customers for CSS during the past four quarters in at least twogeographic regions for example, the Asia/Pacific region, Latin America, South America, NorthAmerica and Europe

    Page 16 of 28 Gartner, Inc. | G00251937

  • Be able to demonstrate at least $7 million in software revenue for core CSS in the contactcenter (that is, as the desktop of record) from new clients during the past four quarters

    Demonstrate that they will equal or exceed the previous four quarters of business results in theupcoming four quarters

    Appear regularly on client shortlists

    Have a practice with sufficient third-party consulting and integration firms to grow at a double-digit pace for five years

    Have sufficient professional services to fulfill current and future customer demands during thenext six months, as well as have at least enough cash to fund a year of operations at the currentburn rate

    Have the technology to support an extension to cross-channel customer service, without theneed to code in a new development environment, including mobile and social media

    Be trendsetters or market movers, based on their software and strategies

    Evaluation Criteria

    Ability to Execute

    Product/Service (Weight 2013 and 2012: Standard)

    Advances in software architectures particularly in Web orientation, support of mobile devices,video and Web communities are all Web 2.0 requirements that complicate the user's choice. Thevendor must have a scalable SaaS model or have the option of an on-demand delivery model forsome part of its platform to be a Leader.

    We weight the extent to which the company offers a componentized offering, as well ascomplete functionality across several service models.

    We continue to see greater need for strong mashup capabilities that enable organizations toembed applications in the customer service representative's desktop. We also see a strongdemand for declarative systems that enable flexible logic flows. User organizations prefer todesign their own business objects, workflows and business processes, without resorting tovendor support. We expect this demand for composite applications (through in-housedevelopment and application extension to the Internet/website) to accelerate.

    We see a great need for advanced (real-time) decision support and complex knowledge solutioncapabilities, business rule engines and customer feedback management.

    The CSS application should have out-of-the-box functionality, which means a strong set ofindustry- and process-specific business logic and data. Through process design or functionalitybreadth, the system must support end-to-end customer service processes (from customer needto resolution) for the chosen market. Published APIs are critical to connect (or expose) an

    Gartner, Inc. | G00251937 Page 17 of 28

  • application's customer service functionality with another system or process. Vendors will bemeasured on the capabilities of their product releases to support customer service, and on thetechnical support of their multichannel and cross-channel environments.

    The vendor must have either a stable product development team for each product module itsells or a demonstrably successful strategic partnership.

    Overall Viability (Weight 2013: Standard; 2012: High)

    We evaluate the capability of the vendor to ensure the continued vitality of a product, including astrong product development team to support current and future releases, as well as a clear roadmap regarding the direction that the product will take until 2015. The vendor must have the cash onhand and consistent revenue growth during four quarters to fund current and future employee burnrates and to generate profits. The vendor is also measured on its capability to generate businessresults in the CEC market.

    Sales Execution/Pricing (Weight 2013 and 2012: High)

    We evaluate the capability of the vendor to provide global sales and distribution coverage thataligns with marketing messages. It must also have specific experience with selling its CEC to theappropriate buying center. The strength of the management team is key as well.

    Market Responsiveness (Weight 2013 and 2012: High)

    We evaluate the vendor's capability to perceive evolving customer requirements and articulate thatinsight back to the market, as well as create the products for readiness as demand comes online.

    Marketing Execution (Weight 2013: High; 2012: Standard)

    We evaluate the capability of the vendor to consistently generate market demand and awareness ofits CEC solution through marketing programs and press visibility. In an ideal world, marketingexecution should be less critical than some other factors; however, the business reality is thatmarketing success can fuel future growth and improvements.

    Customer Experience (Weight 2013 and 2012: High)

    The vendor must produce a sufficient number of quality clients and references with varying levels ofsophistication to prove the viability of its product in the marketplace. References are used as part ofthe evaluation criteria for the ability to execute and create a vision for how organizations canimprove customer service. Included in this criterion are implementation and support. The vendormust be able to provide internal professional services resources or partner with system integratorswith vertical-industry expertise, CEC domain knowledge, global and localized country coverage,and a broad skill set (such as project management or system configuration) to support a completeproject life cycle. The critical point on customer experience is to ascertain the degree of changemanagement that accompanied the implementation. Often, the end user experiences discomfortfrom the change processes that were introduced with the new system, not from the new software.

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  • The vendor's customer support organization must also be able to provide satisfactory, promptservice to its customers in all regions of the world.

    Operations (Weight 2013 and 2012: Standard)

    Clients must understand where the vendor's CEC business is currently, and where it is going, withregard to viability and direction. The vendor must offer consistent and comprehensible pricingmodels and structures, including for such contingencies failure to perform as contracted, ormergers and acquisitions. The vendor is measured on its flexibility to support multiple pricingscenarios, such as on-premises licensing, as well as application on-demand offerings, such ashosted and multitenant. The vendor must have sufficient professional services in-house orthrough third-party business consultants and system integrators to meet evolving customerrequirements.

    Table 1. Ability to Execute Evaluation Criteria

    Evaluation Criteria Weighting

    Product/Service Standard

    Overall Viability (Business Unit, Financial, Strategy, Organization) Standard

    Sales Execution/Pricing High

    Market Responsiveness and Track Record High

    Marketing Execution High

    Customer Experience High

    Operations Standard

    Source: Gartner (May 2013)

    Completeness of Vision

    Gartner analysts evaluate technology providers on their ability to convincingly articulate logicalstatements about current and future market direction, innovation, customer needs, and competitiveforces and how well they map to the Gartner position. Ultimately, technology providers are rated ontheir understanding of how market forces can be exploited to create opportunity for the provider.

    Market Understanding (Weight 2013 and 2012: Standard)

    The market for CEC is highly diverse because of the multichannel nature of customer interactionand the wide range of processes that need to be supported. To succeed, a vendor mustdemonstrate a strategic understanding of current and future CEC opportunities that are unique to its

    Gartner, Inc. | G00251937 Page 19 of 28

  • target market. This may be new application functionality, evolving service models (such as the CEC)or in-line analytical capabilities for unique customer segments.

    Marketing Strategy (Weight 2013 and 2012: Standard)

    The vendor can describe its go-to-market strategy as something other than growing until it isacquired by a larger company. Even with this as the endgame, it must be clear how prospects willbe protected or even benefit from such a strategy. We look for a well-articulated strategy forrevenue growth and sustained profitability. Key elements of the strategy include a sales anddistribution plan, internal investment priority and timing, and partner alliances.

    Sales Strategy (Weight 2013 and 2012: Standard)

    The strength of the sales force, especially in a challenging economic period, means the differencebetween floundering and steady/rapid growth. We are looking for highly trained sales leaders whoare able to quickly differentiate the value proposition of products and services over the competition.

    Offering (Product) Strategy (Weight 2013: High; 2012: Standard)

    Specific vision criteria include:

    Social (collaborative/social media management) CRM.

    Intelligent decision automation.

    BPM (supporting a threaded service task across functional areas, regardless of channel).

    Creation of content about the most likely customer intentions and how to address them, basedon continuously variable business scenarios. The vendor has a sufficiently broad set ofproducts to ensure the success of the product over time. Without an advanced SaaS productplan, a vendor or product cannot be considered visionary.

    Support of mobile customers.

    Business Model (Weight 2013 and 2012: High)

    To be a Leader through the second quarter of 2014, the vendor should have a SaaS and an on-premises application option for most of or all of the suites, unless the SaaS infrastructure canprovide aspects of a private cloud. Application modules are tightly integrated and have businessprocess modeling capabilities and advanced workflow. The company has a strategy to appeal to itskey vertical industries that is, it integrates with systems unique to an industry, delivers packagedfunctionality and workflows for an industry (such as those for the telecommunications, automotiveand consumer goods industries), and delivers B2B as well as B2C interactions. Vendors with onlyone or the other model will need to prove convincingly why their model will continue to besuccessful.

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  • Vertical/Industry Strategy (Weight 2013 and 2012: Standard)

    Unless a product is deployed as a strong add-on to an existing technology stack, a deepunderstanding of one or more vertical industries will be crucial to offer differentiation.

    Innovation (Weight 2013 and 2012: Standard)

    Innovative vendors incorporate concepts that extend to consumer technologies and service virtualassistants and may have customer service functions embedded in communities (for example,Facebook, LinkedIn, Fan Pages and formal support communities). The vendor understands majortechnology/architecture shifts in the market and communicates a plan to use them, includingmigration issues the shifts may cause for customers on current releases. In most cases, thearchitecture is built to operate in a SaaS delivery model as well as on-premises. We examine howwell the vendor articulates its vision to support service-oriented business applications.

    Mobile-based applications must be fully supported, applications must have a smart client and bedecomposable as widgets or as part of a larger mashup. Applications must help optimize apredictive customer analytics system directly or through tightly integrated partners. Thesepredictive analytics alert management, agents or customers when service patterns are detected thatmight signal the need to adjust a business strategy or direction, or indicate that the likelihood of aparticular business scenario occurring has changed (for example, customers responding to a noticeon defective parts, an accident or financial news). The vendor will be measured on the capability ofits architecture to support global rollouts and localized international installations. The vendor musthave the tools for IT and business users to extend and administer the CEC application. Thecustomer is the final arbiter of whether a company is Visionary.

    Geographic Strategy (Weight 2013 and 2012: Standard)

    The vendor understands the needs of the three largest markets the EU, North America and theAsia/Pacific region and knows how to build a strategy to focus on aspects of the overall market.In South America, Brazil is quickly emerging as a significant source of interest in CEC solutions, andwe examine vendor readiness to serve this crucial current and future market.

    Gartner, Inc. | G00251937 Page 21 of 28

  • Table 2. Completeness of Vision Evaluation Criteria

    Evaluation Criteria Weighting

    Market Understanding Standard

    Marketing Strategy Standard

    Sales Strategy Standard

    Offering (Product) Strategy High

    Business Model High

    Vertical/Industry Strategy Standard

    Innovation Standard

    Geographic Strategy Standard

    Source: Gartner (May 2013)

    Quadrant Descriptions

    Leaders

    Leaders demonstrate market-defining vision and the ability to execute against that vision throughproducts, services, demonstrable sales figures, and solid new references for multiple geographiesand vertical industries. Clients report that the vendors deliver a high level of value and return ontheir commitment. The development team has a clear vision of the implications of business rules,and the impact of social networking on customer service requirements. A characteristic of a Leaderis that clients look to the vendor for clues as to how to innovate in customer service in areas suchas embedded sensors in equipment, mobile support and extension to social communities. Thevendor does not necessarily drive a customer toward vendor lock-in but, rather, provides opennessto an ecosystem. When asked, clients reply that a Leader's product has affected the organization'scompetitive position in its markets and helped lower costs. Leaders can demonstrate $50 million insales to new customers during the past year.

    Challengers

    The vendors in the Challengers quadrant demonstrate a high volume of sales in their chosenmarkets (that is, more than 30% of new business by percentage comes from more than oneindustry, and more than 50% of new sales come from sales into the broader installed customerbase). They understand their clients' evolving needs, yet they may not lead customers into newfunctional areas with their strong vision and technology leadership. They often have a strong marketpresence in other application areas, but they have not demonstrated a clear understanding of theCEC market direction or are not well-positioned to capitalize on emerging trends. Lacking a SaaS-

    Page 22 of 28 Gartner, Inc. | G00251937

  • architect cloud model, the product and/or vendor that may have fulfilled other Leader criteria couldbe found in the Challengers quadrant. The vendors in the Challengers quadrant may not havestrong worldwide presence or deployment partners. Vendors in the Challengers quadrant candemonstrate $50 million in sales to customers during the past year.

    Visionaries

    Visionaries are ahead of potential competitors in delivering innovative products and delivery models.They anticipate emerging/changing customer service needs and move into the new market space.They have a strong potential to influence the direction of the CEC market, but they are limited inexecution or demonstrated track record. Typically, their products and market presence are not yetcomplete or established enough to challenge the leading vendors.

    Niche Players

    Niche Players offer important products that are unique CEC functionality components or offeringsfor vertical segments. They may offer complete portfolios but demonstrate weaknesses in one ormore important areas. They could also be regional experts, with little ability to extend globally. Theyare usually focused on supporting large enterprises, rather than small and midsize businesses.

    ContextThe established business applications for the CEC function are largely obsolete because of theiroutdated programming models, lack of a native cloud architecture and poor abilities in social mediaengagement as a part of a customer service offering. They are simplistic and restricted by inflexibleconfiguration rules and procedures that govern the input, retrieval, and flow of data and information.They support collaborative interactions poorly. Despite the high value of these systems, they havefailed to evolve to incorporate new ideas, such as social experience design concepts, into customerinteraction applications for customer service. Without collaboration capabilities baked into thesoftware, interaction among employees and between employees and customers is limited, and bestpractices are hard to capture or suggest.

    The major vendors developing customer management software fail to see sufficient economic valuein rearchitecting their software for social experience. They are aware of the innovations brought onby communication software and social software, and they are actively pursuing an acquisitionstrategy. They understand that the social revolution in software will adversely affect sales of theircore systems during the next five years. By pursuing a tactic of acquisition and integration, Oracle,SAP and salesforce.com are making good progress, whereas many other vendors covered in theMagic Quadrant lag behind in innovation in this area.

    Organizations are rarely able to migrate from an old system to a new one. More than 500companies have demonstrated that it is possible to take an augmentation approach by which socialCRM tools and internal social tools for collaboration and sharing are integrated into the CECenvironment. Workflows and rules are written, often in the CRM system, and passed to the socialsystem. This is not ideal it's a stopgap step that supports some experimentation and sets the

    Gartner, Inc. | G00251937 Page 23 of 28

  • stage for more-complex deployments, as experience is gathered. This is the reason that Gartner ispressing the concept of the CEC as a seamlessly integrated solution that embraces social mediaengagement.

    As more-complete social-centric CSS systems CEC suites, which have a deeper mastery of real-time analytics reach the market in 2014 and beyond, the business case for migrating to the newtools will be easier to demonstrate. There are industry-specific and geography-specificconsiderations that will cause businesses to accelerate investments in innovation in social-centricinterfaces. The U.S. is at least one year ahead of Europe and other geographies in social media forbusiness processes. High-tech, media and entertainment, retail and consumer goods industries,telecommunications providers, and banking need to move forward during 2013 and 2014. Mining,chemicals, industrial machines, and oil and gas industries are under far less pressure to evolve.

    Market OverviewThe market for CEC applications for the CRM customer service is fragmented, based on thecomplexity of the information required to support the customer and the complexity of the businessrules or processes that form the steps in an interaction. In many parts of the world, such as Indiaand China, cloud-based customer service business applications are not yet the preferred model.There are many good vendors not found in this Magic Quadrant, including:

    BPMonline

    Coheris

    Conversocial

    CRMnext, a division of Acidaes Solutions

    Dimelo

    Infor

    Jacada

    MPL Systems

    Pitney Bowes

    SugarCRM

    Vertical Solutions

    Gartner analysts are available for assistance with evaluations and comparisons of these companiesand products, and others.

    As a delivery model for CECs, SaaS is being accepted by many organizations. However, Gartnerhas observed resistance to SaaS in several areas, including:

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  • Locations in which there is greater caution due to fears regarding data privacy, latency andapplication availability for example, Central and Eastern Europe, many parts of Asia (such asIndia and China) and South America

    National/federal governments and healthcare organizations in which regulations inhibitpenetration

    More-complex environments with high call volumes, high transaction volumes and real-timeintegration with legacy systems, which can slow performance

    In our evaluations, we point out when we foresee a potential challenge for a product based on theselimitations. Through the second half of 2014, complete customer service solutions delivered in theSaaS model will be most prominent in the B2B, low-volume call/contact center, or in the non-process-intensive B2C centers.

    As the market matures, the rating scales from one year to another can shift. The result is that aproduct that has not improved or declined could still show a shift in position on the Magic Quadrantthat has resulted from a change in the weighting of a criterion between 2012 and 2013.

    By 2014, as more applications are built in a cloud-based model, SaaS will emerge as a criticalselection factor at all levels of the CEC. In 2013, at least 75% of CECs will use some form of SaaSapplication as part of the contact center solution. This could be for knowledge management,desktop CRM functionality, feedback management or chat. Through 2014, fewer than 20% oforganizations will select SaaS for complex business process support.

    Recommended ReadingSome documents may not be available as part of your current Gartner subscription.

    "Social Media for CRM Will Force a Shift From Contact Centers to Customer Engagement Centers"

    "Predicts 2013: CRM for Customer Service and Support in the Age of the Everywhere Customer"

    "Planned Research for 2013, CRM Customer Service Strategies, Processes and Technologies"

    "Magic Quadrant for CRM Customer Service Contact Centers"

    "CRM Technologies for the Emerging Customer Engagement Hub"

    "Social CRM Has Made Your New Customer Service Systems Obsolete"

    "Magic Quadrant Criteria for CRM Customer Service Contact Center, 2012"

    "Use Gartner's Pace-Layered Application Strategy to Structure Customer Service ApplicationsBased on Business Value"

    "Magic Quadrants and MarketScopes: How Gartner Evaluates Vendors Within a Market"

    Gartner, Inc. | G00251937 Page 25 of 28

  • Evaluation Criteria Definitions

    Ability to Execute

    Product/Service: Core goods and services offered by the vendor that compete in/serve the defined market. This includes current product/service capabilities, quality,feature sets, skills and so on, whether offered natively or through OEM agreements/partnerships as defined in the market definition and detailed in the subcriteria.

    Overall Viability (Business Unit, Financial, Strategy, Organization): Viability includesan assessment of the overall organization's financial health, the financial and practicalsuccess of the business unit, and the likelihood that the individual business unit willcontinue investing in the product, will continue offering the product and will advancethe state of the art within the organization's portfolio of products.

    Sales Execution/Pricing: The vendor's capabilities in all presales activities and thestructure that supports them. This includes deal management, pricing and negotiation,presales support, and the overall effectiveness of the sales channel.

    Market Responsiveness and Track Record: Ability to respond, change direction, beflexible and achieve competitive success as opportunities develop, competitors act,customer needs evolve and market dynamics change. This criterion also considers thevendor's history of responsiveness.

    Marketing Execution: The clarity, quality, creativity and efficacy of programs designedto deliver the organization's message to influence the market, promote the brand andbusiness, increase awareness of the products, and establish a positive identificationwith the product/brand and organization in the minds of buyers. This "mind share" canbe driven by a combination of publicity, promotional initiatives, thought leadership,word-of-mouth and sales activities.

    Customer Experience: Relationships, products and services/programs that enableclients to be successful with the products evaluated. Specifically, this includes the wayscustomers receive technical support or account support. This can also include ancillarytools, customer support programs (and the quality thereof), availability of user groups,service-level agreements and so on.

    Operations: The ability of the organization to meet its goals and commitments. Factorsinclude the quality of the organizational structure, including skills, experiences,programs, systems and other vehicles that enable the organization to operateeffectively and efficiently on an ongoing basis.

    Completeness of Vision

    Market Understanding: Ability of the vendor to understand buyers' wants and needsand to translate those into products and services. Vendors that show the highestdegree of vision listen and understand buyers' wants and needs, and can shape orenhance those with their added vision.

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  • Marketing Strategy: A clear, differentiated set of messages consistentlycommunicated throughout the organization and externalized through the website,advertising, customer programs and positioning statements.

    Sales Strategy: The strategy for selling products that uses the appropriate network ofdirect and indirect sales, marketing, service, and communication affiliates that extendthe scope and depth of market reach, skills, expertise, technologies, services and thecustomer base.

    Offering (Product) Strategy: The vendor's approach to product development anddelivery that emphasizes differentiation, functionality, methodology and feature sets asthey map to current and future requirements.

    Business Model: The soundness and logic of the vendor's underlying businessproposition.

    Vertical/Industry Strategy: The vendor's strategy to direct resources, skills andofferings to meet the specific needs of individual market segments, including verticalmarkets.

    Innovation: Direct, related, complementary and synergistic layouts of resources,expertise or capital for investment, consolidation, defensive or pre-emptive purposes.

    Geographic Strategy: The vendor's strategy to direct resources, skills and offerings tomeet the specific needs of geographies outside the "home" or native geography, eitherdirectly or through partners, channels and subsidiaries as appropriate for thatgeography and market.

    Gartner, Inc. | G00251937 Page 27 of 28

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    2013 Gartner, Inc. and/or its affiliates. All rights reserved. Gartner is a registered trademark of Gartner, Inc. or its affiliates. Thispublication may not be reproduced or distributed in any form without Gartners prior written permission. If you are authorized to accessthis publication, your use of it is subject to the Usage Guidelines for Gartner Services posted on gartner.com. The information containedin this publication has been obtained from sources believed to be reliable. Gartner disclaims all warranties as to the accuracy,completeness or adequacy of such information and shall have no liability for errors, omissions or inadequacies in such information. Thispublication consists of the opinions of Gartners research organization and should not be construed as statements of fact. The opinionsexpressed herein are subject to change without notice. Although Gartner research may include a discussion of related legal issues,Gartner does not provide legal advice or services and its research should not be construed or used as such. Gartner is a public company,and its shareholders may include firms and funds that have financial interests in entities covered in Gartner research. Gartners Board ofDirectors may include senior managers of these firms or funds. Gartner research is produced independently by its research organizationwithout input or influence from these firms, funds or their managers. For further information on the independence and integrity of Gartnerresearch, see Guiding Principles on Independence and Objectivity.

    Page 28 of 28 Gartner, Inc. | G00251937

    Strategic Planning AssumptionMarket Definition/DescriptionMagic QuadrantVendor Strengths and CautionsAmdocsStrengthsCautions

    Astute SolutionsStrengthsCautions

    KanaStrengthsCautions

    Lithium TechnologiesStrengthsCautions

    MicrosoftStrengthsCautions

    Nice SystemsStrengthsCautions

    Oracle (Siebel)StrengthsCautions

    Oracle (Service Cloud)StrengthsCautions

    ParatureStrengthsCautions

    PegasystemsStrengthsCautions

    salesforce.comStrengthsCautions

    SAPStrengthsCautions

    ZendeskStrengthsCautions

    Vendors Added or DroppedAddedDropped

    Inclusion and Exclusion CriteriaEvaluation CriteriaAbility to ExecuteCompleteness of Vision

    Quadrant DescriptionsLeadersChallengersVisionariesNiche Players

    ContextMarket OverviewRecommended ReadingList of TablesTable 1. Ability to Execute Evaluation CriteriaTable 2. Completeness of Vision Evaluation Criteria

    List of FiguresFigure 1. Magic Quadrant for the CRM Customer Engagement Center