Buyers are finding it increasingly difficult to distinguish one vendor's products from the products of other vendors in the social software market. According to Gartner's latest magic quadrant for social software, competition between vendors is no longer about product functionality, but about the vendors themselves.
Researched and developed by Nikos Drakos, Jeffrey Mann and Mike Gotta, this year’s Magic Quadrant for Workplace Social Software points to a market that is mature, well developed, and crammed with competing companies offering -- well offering much the same product when all the marketing literature is brushed aside.
Market Definition of Social Software
To be clear about what is being discussed here, Gartner defines social software for the workplaces as software that is used principally for enterprise collaboration by putting individuals, teams, communities and networks in contact with each other. The principal gains in using this software and which Gartner sees as key includes:
- Making professional contacts.
- Accessing contact lists of those that can offer advice, reference and referrals.
- Team formation and collaboration on tasks.
The current social and collaboration market is worth an estimated US$ 840 million but, unlike some other software sectors, is growing strongly. Gartner estimates that between now and 2016, the market will grow 13.4% annually and will be worth US$ 1.4 billion.
That said, the business objectives of social enterprise software remain the same. Those that are responsible for developing enterprise strategies around social software are still looking to:
- Enhance enterprise information sharing and increase productivity.
- Support teams across the enterprise by offering learning possibilities and insights into best business practice.
Functionality Alone, Is Not Enough to Compete
While there is still room for technological development within the market in areas like social analytics and gamification, Gartner argues that the market has developed so much that it is now extremely difficult for vendors to compete with each other on the basis of functionality alone.
Functions that were once exclusive to market leaders are now present in even the most limited products, offering features such as activity streams, profiles, embedded messages, and dynamic profiles.
Because of this, Gartner says it was obliged to look beyond core capabilities in order to provide any kind of meaningful distinction between products. It did this by breaking products up into three different categories.
1. Social software in horizontal platform
These are social capabilities that come out-of-the-box with other kinds of related capabilities like content management, unified communications, or enterprise portals. They are favored by IT buyers that are looking for products that work straight away with their information access and management systems.
2. Social software in another application
These are social capabilities that are already embedded in another applications and generally target specific user roles. Gartner says the attraction here is the pulling-together of collaboration activities inside applications that carry out other functions too.
3. Social software for end users
These are products that offer superior user experiences, frequent, or automatic updates, or cloud-based delivery, making it easy to access information from outside the firewall. They aim to appeal directly to end-users who then pressurize IT, or enterprise buyers, to legitimize the choices. Gartner says this category of products is the fastest growing category and will continue to grow rapidly as more enterprises take to SaaS.
However, the market is changing as vendors start to realize that merely providing the same set of functions under a different banner is not going to work anymore. Vendors, Gartner says, need to take into account:
- Specific business requirements, or the context in which collaboration is happening
- Provide for any changes in routines, or habits of individuals that actually using the products.
Finally, as a result of all this, Gartner says that the market will remain extremely volatile for the coming years and that potential buyers should look not at functionally, but should consider their needs as social-enabled businesses..
There are only 4 vendors that made it into the Leaders’ Quadrant this year, which given the number of vendors in the space is surprising. To make it into the Quadrant in the first place, vendors must be able to provide the following functions at least:
- User profiles
- Group spaces
- Content sharing
- Activity streams
From a quantitative perspective they must have: