Insights

The Leader keeps winning and its not close

by Ganesh Rangarajan on May 12, 2017

Gartner released its 2017 Magic Quadrant (MQ) for CRM Customer Engagement Center earlier this week.  The big board is filled with the usual suspects – Salesforce, Microsoft, Oracle, Zendesk, Pegasystems, Lithium, and SAP.  There are a couple of new faces this year – eGain and ServiceNow and Verint’s been dropped.  You can see a side by side comparison of the 2016 and 2017 MQ below.

  

So here are some of my high level takeaways:

  • Despite some wins, especially in the healthcare and CIC arena with its Customer Decision Hub product, Pegasystems has yet to close the execution gap with Salesforce.  SAAS accounts for roughly 8% of Pega’s revenues and most deployments tend to be on-prem and customers that are gravitating to it are looking for strong business modeling and handling of complex customer service cases.  Still Pega is widely considered among the top three innovators in the space along with Salesforce and Microsoft.
  • Oracle Service Cloud boasts a suite of complementary offerings for field service and the company continues to make investments to rationalize and integrate the suite.  However, customers continue to see operational challenges with the suite and pricing is still complicated and not competitive.  Despite a concerted effort to close the gap with Salesforce, its clear they are not there yet.
  • Microsoft, and there has been tremendous buzz around the Dynamics CRM for the last two plus years and they are rapidly moving their core to the Azure cloud.  However, what could have been a nice gain in marketshare against Salesforce was an opportunity wasted because of their pricing.  The TCO was not sustainable.  Add to that the lack of an overall ecosystem such as Salesforce’s, and the catch up game continues.
  • Then there are the perennially competent and viable platforms such as Zendesk, SAP, and Sugar and new entrant, ServiceNow.  Zendesk installs have been typically small (20 seats) though we are seeing larger (100+) installs as well.  Zendesk provides fairly vanilla capabilities with limited industry-tailored customization while ServiceNow is doing well in field service where processes can be built around field assets (where Salesforce’s Field Service/Click Software acquisition helped).   SAP’s Hybris as a Service (YAAS) is interesting but nowhere ready to compete against the more entrenched players.

There are many heavy weights competing actively to become the Customer Engagement Hub for cross channel customer service.  Microsoft, SAP, Oracle, and to a certain extent, Pega, will continue to invest organically or perhaps acquire products to make their offerings more robust and competitive.  However, the leader and innovator continues to be Salesforce.  Add to that the largest ecosystem of complementary/supplementary partner apps and it is very clear – there is a clear leader that keeps winning and its really not even close.

You can view the latest 2017 CRM Customer Engagement Center MQ here.

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