As we seek to build our business and capture the ‘big Mo’ (the winning momentum that every US Presidential candidate is droning on about at a town hall meeting near some of you right now), we’re meeting a lot of B2B tech firms.
Pretty much every one of them says their own momentum is intimately connected to what leading industry analyst Gartner (which just happens to be a Velocity client, BTW) thinks about their company, their products and their technology; specifically people care passionately about where they sit on the fabled Magic Quadrant for their industry or product segment.
Many of them do seem to spend lots of time and money – with PR companies and analyst relations houses in particular – trying to convince Gartner to shift their position to the top right of the MQ. And many others – usually the smaller, newer ones – exhaust themselves just trying to get on the MQ radar at all.
No surprise really. Customers – the people buying tech – use Gartner to create shortlists. But could tech firms spend less time, effort and money and have a bigger impact? And are they really paying attention to what Gartner says is important for Magic Quadrant success and then taking the relevant action in response? I’m not convinced, because Gartner’s advice is so explicit.
A quick reminder of what the Magic Quadrant is all about. As the expensively produced chart below shows, Gartner plots what it calls a vendor’s ‘Completeness of Vision’ against its ‘Ability to Execute, creating four quadrants ‘Leaders’, ‘Challengers’, ‘Niche Players’ and ‘Visionaries’. The higher on the Quadrant vendors are found and the further to the right they place the more seriously rich customers take them.
So how do you become a Gartner nominated ‘Leader’? Well Gartner is pretty explicit about this. It calculates a vendor’s Completeness of Vision by differentially weighting eight separate factors. The highest weighting is given to two things: the first unsurprisingly is a company’s capacity for innovation. This relates specifically to R&D performance.
The second is ‘Market Understanding’ – basically the ability of a vendor to align its marketing strategy with market needs. And two other marketing factors, ‘marketing strategy’ and ‘offering strategy’ – what most companies call product marketing – are also judged to be critical in a company’s Completeness of Vision. So three of Gartner’s eight criteria on this axis put great marketing at the heart of a great rating.
What about ‘Ability to Execute’? Well marketing is important here too. This axis seeks to measure how well the vendor in question is equipped to succeed in the market in question. It scores product function and feature, the quality of the sales force, the overall viability of the company in financial and organizational terms and the quality of the customer base. But the highest weighting (equal in importance to scale and quality of R&D investment) is what Gartner calls “Marketing Execution’, defined as:
‘the overall effectiveness of the vendor’s marketing efforts, and the degree of ‘mind share’, market share and account penetration that the vendor has achieved. Marketing execution is a significant driver of sales, growth and brand awareness and therefore receives a high weighting’.
With Gartner being so explicit about the importance of marketing to Magic Quadrant success, and buyers listening so intently to what Gartner says, why do so many tech B2B vendors see marketing as a cost instead of an investment? Frankly, it’s baffling.