Chris Fletcher is the Gartner Analyst who wrote the recent Magic Quadrant for CRM Lead Management. He is part of Gartner’s CRM and E-Commerce research team and publishes research on CRM and e-commerce segments, including lead management, B2B and B2C e-commerce, e-commerce subscription/billing/payments, and partner/channel management. We caught up with Chris to get his response to some questions we have about the recent Magic Quadrant for CRM Lead Management.
What does the term CRM Lead Management mean?
The formal definition Gartner provides for CRM Lead Management is at the top of this year’s Magic Quadrant for CRM Lead Management:
Lead management integrates business process and technology to close the loop between marketing and direct or indirect sales channels, and to drive higher-value opportunities through improved demand creation, execution and opportunity management. Lead management processes take in unqualified leads from a variety of lead generation sources, including Web registration pages and campaigns, direct mail campaigns, digital marketing channels and sources, email marketing, multichannel campaigns, database marketing and third-party leased lists, social CRM and social networking sites, and tradeshows and other events (such as webinars, or customer or prospect events). The outputs of lead management processes — qualified, scored, nurtured, augmented and prioritized selling opportunities — are handed off to direct sales and/or channel sales organizations.
The less formal definition I give clients is simpler: Lead Management, done correctly, provides qualified, augmented, scored selling opportunities to your direct sales and channel sales organizations, increasing top-line revenue and decreasing the time required to turn leads into cash (aka the “lead to cash ratio”).
It is also worth noting that this year is the first time Gartner has ever published a Magic Quadrant for CRM Lead Management.
Why does Gartner call it CRM Lead Management when LM is a process versus a technology? Why not a separate Marketing Automation Quadrant?
I agree that Lead Management is a process, and not a technology: in fact, if you take a look at Gartner’s definition of CRM and Marketing Automation, we always stress to our clients that technology alone will not solve your problems: technology is a tool that enables CRM processes.
The question on why Marketing Automation doesn’t have its own Magic Quadrant is kind of a trick question. There is no Magic Quadrant for CRM, and no Magic Quadrant for Marketing Automation either: there are instead almost 20 individual Magic Quadrants focusing on distinct segments of CRM. Good examples of this include the Magic Quadrant for Marketing Resource Management, the Magic Quadrant for Multi-Channel Campaign Management, for E-Commerce, for Integrated Marketing Management, and the Magic Quadrant for Sales Force Automation, to name a few. For an interesting perspective on the depth Gartner brings to this segment take a look at a Gartner note titled “The Elusive CRM Magic Quadrant” – it’s elusive because there isn’t one.
By the way, it is probably worth noting that “CRM” was the #1 search term clients used on Gartner.com in 2011.
Does Gartner view CRM and MA as the same? It would seem yes if you are pairing SFDC and Eloqua/Marketo in the same Quadrant.
CRM is the top-level category: Within CRM Gartner includes Marketing Automation, Sales Force Automation, Customer Support and Service, E-Commerce, and Social CRM – among others.
Your question on including Salesforce.com and Eloqua/Marketo in the same MQ is a good one: Both Eloqua and Marketo were Leaders in this year’s MQ for Lead Management, based on their vision and on their ability to execute in this segment. Salesforce.com (and it should be noted, Oracle/Siebel and Microsoft Dynamics CRM) appeared in the Quadrant because their products provided basic (at least in our opinion) lead management functionality (albeit as an integrated feature/function set within their CRM applications) and met the technology criteria.
Why was minimum vendor revenue raised to $20M? Doesn’t this exclude some good solutions?
This is one of the qualification criteria that I struggled with, frankly, and still think about even now that the MQ has published. Short answer to your question: Yes, there are some very good lead management solutions out there from vendors that have not yet developed a revenue stream of over $20 M. And yes, for a SaaS vendor, where the revenue stream is spread out over several years, as opposed to a licensed solution that enables the vendor to recognize the revenue immediately, this represents an even higher hurdle.
On the other hand, Gartner clients are investing not only in a technology but also in a company. Part of that investment rests on the viability of the vendor and their ability to survive over the next several years, and their ability to generate some minimum floor of revenue is one indication – definitely not the only, but one of the indicators – that shows viability.
What is the biggest trend you see in marketing automation today?
I see two trends: one is innovation, and the other is maturity. Innovation, because I see technology vendors that are able to react quickly to changes in the market, incorporate new functionality, and deliver it to their customers quickly and efficiently, often by leveraging the Cloud.
I also see a growing level of maturity as marketing professionals learn what works for their company and their industry, and are able to evolve and change their lead management processes in near-time and provide better overall value to their firm. As a proof point, take a look at the 2012 Hype Cycle for CRM Marketing Applications (due to be published in July) and look at the advancement that Lead Management has made as a category. It’s very encouraging, and right now it’s a great segment to be covering as an analyst.