This Guest Posting was first published on LinkedIn by Derk Erbe, EVP at Kea Company. Many thanks for allowing me to re-publish.
Even with a host of blogs and other forms of social media, Gartner’s Magic Quadrant remains the IT market’s most highly visible piece of commentary. Because the Magic Quadrant impacts billions of dollars of corporate IT purchases, some tech vendor executives put too much emphasis on “moving the dot”, which drains resources from the overall AR plan. Other vendors decide to ignore Magic Quadrants, missing an opportunity to leverage an effective marketing channel. Neither approach is 100% appropriate. In this post, we provide background on the Magic Quadrant and suggest that vendors take a middle approach between obsession and indifference.*
It is not uncommon for a KeaCompany strategist to hear the following comment from an analyst relations (AR) manager: “Our execs – or even board of directors – have made improving our position on the Magic Quadrant THE (not ‘a’) goal for AR.” While ignoring the Magic Quadrant (MQ) can be perilous to a vendor’s top line, too much emphasis on a MQ can drain scarce AR resources from influencing all the analysts covering your particular market. The downside is that AR won’t be able to develop counterbalancing relationships with analysts in other firms, leaving the vendor dangerously reliant on Gartner and the MQ for positive analyst coverage.
We think it’s time that vendors take a balanced approach to the MQ.
Snapshot of the Magic Quadrant
The MQ is the most famous and enduring industry analyst signature research. It was developed by Gideon Gartner, Mike Braude and Doug Cayne in mid-1980s based on Boston Consulting Group’s “2 by 2” graphic from the 1960’s. The purpose is to offer a snapshot – not a definitive view – of a technology market. It acts as a visual “Strategic Planning Assumption” tool and covers all markets: software, hardware, services.
Around 1993, Gartner’s Editorial Department unilaterally decided that it would no longer permit analysts to use the phrase “Magic Quadrant” to describe this research graphics on the grounds that it was neither a quadrant nor magic. Needless to say, this caused an uproar throughout Gartner, especially in the Sales force. Why?
The MQ truly is magic… for Gartner
The MQ is branding, marketing and selling magic for Gartner. Even in the early 90’s it was becoming legendary. While Gideon Gartner bemoans the dominance and misuse of the MQ, it is valued by the IT executives that use it every day.
Yes, the Magic Quadrant can impact billions of dollars of IT purchasing decisions. Often it is used to select which vendors can bid on a particular project, either formally (e.g., only Leaders are added to a short list) or informally (e.g., the IT decision makers think “hmm, this vendor doesn’t have that great of a position on the MQ so let’s just leave it off the short list”).
However, even though it is pervasive and has a high impact, the MQ is not the only game in town. Other analyst firms (e.g., Forrester with its Wave) have high visibility research deliverables. Furthermore, even though Gartner is the largest analyst firm, not every buyer of technology is a client of Gartner. Gartner’s CEO Gene Hall often says on their quarterly earnings call that it is only in approximately 20% of global enterprises with US$1 billion or more in revenues. And even in those clients, Gartner has not penetrated every part of the company. Finally, Gartner is not influential in every market covered by a MQ.
* Are you having trouble convincing your executives to take the middle approach between obsession and indifference? Kea Company’s insight on the Magic Quadrant can be a valuable tool in your education campaign about the appropriate approach to take.
Kea Company Technique
* Investigate how the Magic Quadrant actually impacts your market segment
* Educate your executives about the real role of the Magic Quadrant in your market and with your customers and prospects
* Develop, communicate and execute a plan on an appropriate campaign to change or maintain your company’s position(s) on the relevant Magic Quadrant(s)
While Gartner’s Magic Quadrant is the signature IT analyst deliverable and has tremendous influence with buyers of technology products and services, IT vendors should not become obsessed with moving their dots. It is critical that executives and AR managers take a realistic appraisal of their situation in regards to any particular MQ and devote only the amount of effort proportional to the potential return.
This post is one in a series about tech vendors and their relationship with the Gartner Magic Quadrant. In addition to this series, there is a Kea Company Guide to the Magic Quadrant that helps research consumers – whether enterprise IT managers or vendors – make appropriate use of this most famous and misused research deliverable.
For those AR managers needing much more depth than what is appropriate please contact us at Kea Company and we can have a conversation on how to provide more depth and breadth on this critical topic in the IT industry.
With this series I want to build on the excellent work that Dave and Carter did at SageCircle. The MQ is relevant today and many tech vendors struggle to get their strategy right. This alone is enough to warrant further exploration of the topic.