You could end up buried deep in the “Niche” by insisting on being added to a MQ before you are ready

Niche = “Losers” on the Magic QuadrantGartner’s Magic Quadrant is probably the iconic piece of analyst research. With its visibility and status, it also has enormous influence on vendor sales opportunities, especially when it comes time for IT buyers to draw up the all-important vendor short lists.

Because of this influence on short lists, communications and IT vendor executives sometimes obsess over the “MQ” for their markets and put great pressure on their AR teams to get placement on MQs they are not on. This can actually be a counterproductive move because vendors who really should not be on a MQ will get stuck in the lower left hand corner (click on graphic to enlarge). Even thought this part of the MQ is labeled “Niche,” too many IT buyers translate that label into “Loser.” Getting perceived as a “Loser” can put a vendor’s sales at a disadvantage in trying to get into an opportunity because it is so much more difficult to explain away why you are not a “Loser.” than explaining why your company was not included on a version of a MQ.

Some Gartner analysts publicly admit that this mental relabeling occurs and try to mitigate the perception in print, in speeches at Gartner events, and during phone-based inquiry. Here are some examples of analysts trying to ensure that niche vendors are not overlooked:

  • (Archive) Panning for Gold in the DBMS Market / 5 January 1999 / M-06-6399 / Betsy Burton
  • (Archive) Panning for Gold in the Niche Vendor Quadrant / 6 August 2001 / T-14-1971 / Jess Thompson
    • Revisited by the same analyst as “‘Panning for Gold’ Outside the Leaders Quadrant of Gartner’s Magic Quadrant” / 5 September 2007 / G00151234
  • (Archive) Global Campus LAN for 2H02 — The Fighting Niche Players / 4 November 2002 / M-18-1643 / Mark Fabbi

I especially like the title of Mark’s research note because it shows a little love for those scrappy underdog vendors – some of whom are actually major vendors in adjacent markets.

Analysts also attempt to look out for vendors’ best interests by trying to convince vendors that they should not insist on being included on ill-suited MQs. When confronted with some vendors that simply will not take “no” for an answer, some analysts will shrug and put the vendor on the MQ… in the lower left corner. Now the vendor is a “Loser.”

Rather than fight with an analyst trying to get on MQs that they are not suited for, vendors should take a strategic approach so that their eventual position upon entry will be favorable. At the same time, AR teams should equip with their sales forces with the tools needed to explain why the vendor is a no show on a MQ.

SageCircle Technique:

  • Conduct one or more inquiries (if you are a client) with the Gartner analyst to grok the MQ criteria and the analyst’s perception how you match up with the criteria
  • Partner with analysts to make the case to your executives that exclusion from the next version of the MQ is in the company’s best interest
  • Analyze the criteria to determine whether your company has a realistic chance of achieving favorable placement in a future MQ
  • Analyze the criteria to decide if a campaign has to be executed to modify certain criteria that if not changed would continue to exclude you from future MQs
  • Evaluate whether there is an equivalent Forrester Wave and if you could achieve favorable placement with less effort than the MQ. If so, switch your focus from the MQ to the Wave
  • Work to equip Sales with talking points and potential counterbalancing research (e.g., a Wave) to help them mitigate any downside from not being on a MQ

Bottom Line: Vendors should not ignore, but also not obsess over, Gartner Magic Quadrants. However, vendors need to take to take into account how IT buyers really think about each box on the MQ and not force their way onto MQs where placement would not be favorable. Instead, vendors should take the long view and think strategically about how and where they will get added onto a future version of the MQ.

Question: AR teams – What are the arguments executives make that the company absolutely has to be on a Magic Quadrant?

Do you need to “move the dot?” SageCircle can help – SageCircle strategists have a library of best practices for attacking the Magic Quadrant and can help you apply those best practices to your specific situation. Call 650-274-8309 to learn more how SageCircle can give you the insights, tools and advice needed to accomplish your MQ goals.

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6 Responses

  1. Getting on the MQ may or may not be a good thing. It depends on a start-up’s circumstances, business strategy, publicity strategy, leadership, image, and many other factors.

    I look at this as a “glass half empty” vs. “glass half full” type of deal. IMHO – to automatically consider a lower-left quadrant a death-knell is a short-sighted and shallow perception.

    For many startups, even getting ON the magic quadrant gives a certain measure of respect. It means you’re on the Gartner radar, and subject to being watched. For companies on the way up, this is a good thing that can lend a sense of legitimacy and viability to a start-up acquiring new customers.

    Some avant garde enterprises purposely seek out niche vendors who are experts in particular fields for various reasons, and adopt their solutions for competitive advantage. The last thing these enterprises want is their secrets being discovered and exposed.

    On the other hand, it may also be a strategy to deliberately STAY OFF the MQ radar for some vendors. Think “to whom much is given, much is expected.” Is the increased scrutiny really worth it?

    Seeking out alternatives such as the Forrester “Wave” or the Ovum “Navigator” (which they are just now resuscitating) can potentially (or not) be a better way to go.

    Cheers,
    Gerry

  2. Hi Gerry,

    Excellent points. BTW, this post is not just limited to startups, but includes mature large vendors that happen to be expanding into new markets.

    “Short sighted and shallow,” me? ;-> While there is an argument to be made that any visibility is good visibility, there are too many examples of IT managers by-passes all quadrants except for the “Leaders” to say that position does not matter.

    You are right that a small subset of enterprises are sophisicated enough to match capabilities of the vendor to their needs and not simply rely on a dot’s position. This is the type of behavior that analyst Jess Thompson is trying to encourage. Everybody in the analyst ecosystem — excepting vendors in the Leaders box ;) – need to encourage analyst end-user clients to think outside the Leaders box.

    Upon further review, I should have carved out an exception for an emerging market where there are mainly Niche vendors with few Challengers and Visionaries and no Leaders. In that situation, vendors are highly encouraged to push to get on the MQ because there will be no positional disadvantage.

  3. Providing an appropriate MQ response (no matter what quadrant you get placed in, and the size of your company/LOB) is hard work!

    Perhaps a follow-on post is in order about how AR vendors can most effectively ane expeditously respond to an MQ request. If a company decides to engage, what are the basic & best arrows needed to have in the quiver? And how are these arrows best fired?

    Okay, okay…I won’t get into any puns about “wood behind the arrow” or poison-tips….

  4. Sorry, I meant to say “AR *at* vendors …

  5. [...] covering their sector. In fact, here’s how analyst relations strategy firm SageCircle describes it: Gartner’s Magic Quadrant is probably the iconic piece of analyst research. With its visibility [...]

  6. [...] came out with its Social Software Magic Quadrant in October. As SageCircle notes: Gartner’s Magic Quadrant is probably the iconic piece of analyst research. With its visibility [...]

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