Gartner just named the leaders of its $20 million CRM lead management vendor club. And it's still tough to crack the leaderboard.
Only Marketo, Oracle and IBM (Silverpop) made it to the “leaders” section of the Stamford, Conn.-based research firm’s annual list of top vendors for customer relationship lead management.
That is only a slight change from last year — Oracle and Marketo were the lone leaders in Gartner's Magic Quadrant for CRM Lead Management in 2014.
IBM (2014 “challenger”) and Silverpop (“niche player”) earned citations as separate entities in 2014 by Gartner. IBM acquired Silverpop in April 2014, only a couple of months before Gartner published its 2014 report.
Gartner only looks at vendors with at least $20 million in lead management revenue in the past year.
Everyone made it back this year, and some showed up after getting the cold shoulder a year ago: Act-On, CRMnext, HubSpot, MMIT and Salesfusion.
Users Getting Tough
Gartner defines lead management as software that allows sales and marketing teams to take in unqualified contacts and opportunities from a variety of sources: such as web registration pages and campaigns, direct mail campaigns, email marketing, multichannel campaigns, database marketing and third-party leased lists, social for CRM and social media and tradeshows. Those opportunities are passed on to direct, indirect or e-commerce sales channels.
Gartner authors Chris Fletcher and Jason Daigler said users of CRM lead management software are getting better at choosing their software. They expect “quantifiable proof points that show revenue impact.”
Acquisitions like Adobe-Neolane, IBM-Silverpop, Microsoft-Marketing Pilot, Oracle-Eloqua and Salesforce-Pardot have been significant in this space, the authors noted.
“User organizations are asking increasingly complex questions,” Gartner authors reported, “and taking longer to make investment decisions regarding lead management applications.”
Labels, Labels, Labels
Gartner categorizes the vendors it included in its Magic Quadrant this way:
- Leaders: Provide market-leading functionality that supports B2B, B2B2C and B2C lead management processes across multiple channels, and both outbound and inbound marketing processes (Marketo, Oracle, IBM-Silverpop)
- Challengers: Offer breadth of functionality, but lack the depth of functionality of the Leaders (Salesforce, Adobe)
- Visionaries: Have a strong vision for a set of technologies that includes lead management, but they do not yet provide best-of-breed lead management that is both broad and functionally deep (HubSpot)
- Niche players: Provide a basic set of lead management features to a narrow segment of the potential market (SugarCRM, CRMnext, Microsoft, CallidusCloud, Act-On, MMIT, Salesfusion, Zoho)
Why Leaders Lead
What does Gartner like and dislike about its leaders?
Marketo has strong functionality and is easy to use. It has new markets and features like new APIs for data exchange, SEO, predictive analytics and personalization.
Marketo’s one of the few pure-play lead management vendors left and competes with larger vendors that have acquired technology like theirs. More than 80 percent of Marketo’s revenue comes from US, which could be an issue, Gartner authors reported.
Chandar Pattabhiram, group vice president of product and corporate marketing at San Mateo, Calif.-based Marketo, told CMSWire Marketo is seeing "excellent expansion" across EMEA, APAC and Japan regions. Pattabhiram cited customer wins such as Panasonic, Subaru and Tupperware as well as the launch of a global R&D and innovation center in Tel Aviv.
Responding to Gartner's claim that Marketo's foray into B2C is "relatively new," Pattabhiram said, "We are experiencing strong growth in the B2C segment with wins such as Palace Sports Entertainment (Detroit Pistons), Kaiser Permanente and more."
"Companies like Auction.com and Carfax," Pattabhiram added, "are meeting their B2B and B2C needs by leveraging our single platform rather than trying to use separate B2C and B2B solutions offered by our competitors."
Oracle has a broad range of product functionality and a strong marketing cloud, Gartner authors said, and has strong cross-channel marketing. And it has a strong global presence.
Integration with Oracle Marketing Cloud apps can be problematic, and costs for its feature-rich lead management product can run higher than others.
IBM’s strength is it has multiple marketing assets, and Silverpop brings a “robust” email marketing hub, a marketing database and interactive analytics.
Gartner authors said some customers spoke of confusion over the feature/function overlap with IBM’s marketing products and others in which to invest. Licensing models include a mix of technology stacks, and recent name changes for products have created confusion.
Show Me the Dough
Overall, Gartner estimates that investments in CRM marketing automation applications and services, which includes lead management, will be worth about $4.2 billion by 2016.
And traditional marketing organizations like HubSpot are investing in CRM systems internally. HubSpot, known for its inbound marketing and marketing automation tools, announced its free CRM and Sidekick tool in September. The CRM was the result of "customer-driven demands," HubSpot officials told CMSWire in May.
Marketing platform users inquired about using HubSpot's existing tools as a CRM. Some entities still use Salesforce CRM, which integrates with HubSpot's marketing platform. But as other clients grow, they've needed a CRM. Enter HubSpot’s CRM.
Salesfusion’s bread-and-butter, meanwhile, may be its marketing automation integration with CRM.
Third-party vendors like NextPrinciples want a piece of the pie, too. They claimed last year their platform boosts marketing automation with its technology that generates better-qualified new leads and deeper insights into existing leads and customers. Its newest solution, an automated platform for social media marketing released last year, marries social media, marketing automation, demand gen and CRM.
Title image by Joshua Earle.