Magic Quadrant for Sales Performance Management

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Strategic Planning Assumptions

By 2022, 40% of B2B companies with more than 100 payees will employ sales performance
management solutions to reduce their hidden incentive compensation overpayments by 3% to 5%.

By 2020, 30% of all B2B companies will employ AI to augment at least one of their primary sales
processes.

By 2022, organizations using a sales performance management solution will use employee-facing
digital assistants to handle 75% of their compensation disputes.

Market Definition/Description
Gartner’s view of the sales performance management (SPM) market is focused on transformational
technologies or approaches that are delivering on the future needs of end users. It is not focused on
the market as it is today.

Gartner defines sales performance management (SPM) as a suite of operational and analytical
functions that automate and unite back-office operational sales processes. SPM is implemented to
improve operational efficiency and effectiveness. Capabilities include sales incentive compensation
management, objectives management, quota management and planning, territory management and
planning, advanced analytics (such as benchmarking, predictive/prescriptive and machine
learning/cognitive), and gamification.

Gartner defines incentive compensation management (ICM), which includes standard reporting and
analytics, as the principal of three core capabilities for SPM — which incorporates territory
management and quota management. These core capabilities link to the following “near-core”
capabilities: quota planning, territory planning, advanced analytics, gamification and objectives
management.

Gartner estimates that the market — at more than 25% adopted — understands the value of SPM in
an organization. There are sufficient use cases, and proven return on investment (ROI), to justify its
purchase based on cost savings and operational efficiency alone. This market is characterized by
continued innovation, growth and adoption. SPM provides value from an end-user (sales
representative/agent/payee) as well as an internal (back-office) perspective, improving sales execution
and operational efficiency.

The benefits of SPM include:

Reduced overpayment/underpayment, saving organizations from 3% to 5% in compensation

expenses

Increased scalability and performance through automation

Increased sales representative (rep) performance by aligning compensation with corporate

goals and objectives

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 Faster data-driven analytics, shortening the time to decisions and actions

Optimization of business processes and compensation plan design

Increased revenue/profitability growth through better compensation plan design by using data-
driven decisions from historical results.

For more information on sales technologies, see “Hype Cycle for CRM Sales, 2018.”
SPM solutions provide functionality that is shifting the benefits customers receive from efficient
execution to effectiveness and optimization of processes. This is due to advanced analytics
capabilities, such as machine learning (ML) algorithms, now being available and specifically designed
for SPM.

The latest innovations from SPM vendors include:

The development and delivery of capabilities around natural language processing (NLP) for
data-driven insights via exploration

Intelligence around compensation plan optimization and next-best action recommendations

surfaced to sales reps

Possible uses for bots to address reps’ next-best actions and dispute resolution.

Organizations using a packaged application for a longer period of time can optimize their planning
and processes through these newly offered advanced analytics capabilities. In turn, they will be able to
provide better business outcomes and additional value to the organization. For example, providing
“good,” “better” or “best” compensation plan models based on specific scenarios for quota or territory
planning.

SPM solutions have been available for more than a decade, and provide mature capabilities. Not
surprisingly, Gartner sees the Leaders in this Magic Quadrant tightly gathered, with no clear market
leading vendor. Each vendor varies in the depth and breadth of its functionality. Buyers should
document, at a granular level, their requirements, resources, skill sets and culture in order to select
the most appropriate vendor for their organization. Application leaders supporting sales technology
should focus on incentive compensation as a Phase 1 approach. This will provide an immediate ROI
and gain the trust of the employees. Sales reps are more likely to adopt an automated solution that
provides transparency into their pay, and with that trust will spend less or no time shadow accounting
— thus utilizing more hours to sell. Quota and territory planning and management should follow, as
needed.

Magic Quadrant

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 Source: Gartner (January 2019)

Vendors Added and Dropped

We review and adjust our inclusion criteria for Magic Quadrants as markets change. As a result of
these adjustments, the mix of vendors in any Magic Quadrant may change over time. A vendor’s
appearance in a Magic Quadrant one year and not the next does not necessarily indicate that we have
changed our opinion of that vendor. It may be a reflection of a change in the market and, therefore,
changed evaluation criteria, or of a change of focus by that vendor.

Added
Performio is new to the Magic Quadrant this year

SAP acquired CallidusCloud in early 2018, and appears as SAP (CallidusCloud)

Dropped

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 CallidusCloud was acquired by SAP in early 2018; it is now part of the SAP (CallidusCloud)
evaluation

Obero was acquired by Xactly in 2018, and now forms part of the Xactly evaluation

Inclusion and Exclusion Criteria

The inclusion criteria represent the specific attributes that analysts believe are necessary for inclusion
in this research.

To qualify for inclusion, vendors must:

Have at least 55% of annual revenue from SPM software sales

Offer a native incentive compensation management product that is inclusive of sales incentive
compensation crediting and includes out-of-the-box reporting and analytics, plus at least one
other SPM capability. These additional SPM capabilities are: territory management, quota
management, gamification, objectives management, advanced analytics, territory planning,
quota planning and sales comparative benchmarking. Examples of advanced analytics include
predictive, prescriptive, ML and benchmarking. Examples of sales comparative benchmarking
include the benchmarking and analysis of sales execution including traditional and
nontraditional data — such as sales activities and sales enablement activities including
structured and unstructured data from non-SPM sources.

Have an SPM product in general availability (GA) for at least 12 months

Support a customer base of at least four different industries, such as banking, financial services,
retail, insurance, telecommunications, media, travel and transportation

Offer a native cloud (SaaS) solution

They must also meet at least two of the following four criteria:

Have at least $5 million in SPM software license revenue (during the evaluation period August
2017 to July 2018) for the SPM product being submitted for consideration

Have sold to at least 15 net new named SPM accounts (new logos, independent of
reimplementations from previous versions of a product) during the past 12 months. The buyers
must have purchased the SPM software to manage their own SPM operations, not as a
managed services function

The SPM product must have at least 20 active (live) named accounts (logos, not subsidiaries or
business divisions)

Private organizations/vendors must have more than 50 employees

Honorable Mentions

Axtria — Based in New Jersey, U.S.

bpm’online — Based in Massachusetts, U.S.

Core Commissions — Based in Washington, U.S.

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Evaluation Criteria

Ability to Execute
Product/Service: SPM applications include capabilities for native incentive compensation
management, including standard reporting, territory management, objectives, quota management,
territory planning, quota planning, advanced analytics and gamification.

Different sales organizations require different levels of depth and complexity of capabilities. Vendors
that support a wide range of complexity have greater market potential and are rated accordingly.
Vendors must articulate information regarding their product and the market it serves. This is a cross-
industry Magic Quadrant — therefore, the evaluation of a provider’s offering is focused on the ability
to serve several distinct industry sectors, rather than on the ability to provide industry-specific
solutions. Products that provide a mobile application will be evaluated accordingly. In many cases, an
SPM application will combine several functional components — some of which require third-party
vendors. A key evaluation criterion is how well the SPM vendor’s application integrates with third-party
products and customer data sources. This is measured primarily by the number and complexity of
data and application integrations, as demonstrated by live customer deployments. Vendors that have
fostered an ecosystem of value-added application suppliers and partners will rate well for this
subcategory.

Overall Viability: Key aspects of this criterion are the vendor’s ability to ensure the continued vitality
of a product, including support of current and future releases, as well as a clear roadmap for the next
three years. The vendor must have the cash on hand, and consistent revenue growth during four
quarters, to fund employee burn rates and to generate profits.

Sales Execution/Pricing: The vendor must provide global sales and distribution coverage that aligns
with its marketing messages.

Vendors will be evaluated based on measurable criteria: including, but not limited to, the number of
new customers acquired for their SPM product, competitive replacements by their SPM product (not
Microsoft Excel/homegrown). They are also evaluated on year-over-year acquisition rate, average deal
size for the SPM product, customer references’ product adoption for core and near-core capabilities,
and references’ perception of value for the SPM product.

Market Responsiveness/Record: The ability to respond, change direction, be flexible and achieve
competitive success as opportunities develop, competitors act, customer needs evolve, and market
dynamics change.

Vendors will be evaluated based on the number of innovative product releases, as well as the number
and quality of enhancements provided in those releases. This criterion also considers the vendor’s
history of responsiveness to customers and to market dynamics, including the use of formal customer
advisory programs, conferences and user groups.

Marketing Execution: The clarity, quality, creativity and efficacy of programs designed to deliver the
organization’s message. The ability to influence the market, promote the brand and business, increase
awareness of the products and establish a positive identification with the product/brand and
organization in the minds of buyers. This “mind share” can be driven by a combination of publicity,
promotional, thought leadership, word-of-mouth and sales activities, as well as the use of social media

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and other marketing channels. These channels provide thought leadership, and amplify marketing and
sales messages, and brand. Vendors will be evaluated based on their appearance on buyers’ shortlists,
as well as their use of multiple marketing channels to reach prospects.

Customer Experience: Feedback from active customers on generally available SPM releases during
the past 12 to 18 months is an important consideration here. Sources of feedback include vendor-
supplied customer references, Gartner inquiries, crowdsourced reviews (such as Gartner Peer Insights)
and customer testimonials. Also included are other customer-facing interactions, such as Gartner
conferences. Customers’ experiences are evaluated based on the vendor’s ability to help customers
achieve positive business value, as well as sustained user adoption, quality, implementation and
ongoing support.

Vendors will be evaluated on the functions of customer support as well as those of customer success.

Operations: The ability of the organization to meet its goals and commitments. Factors include the
quality of the organizational structure, including the skills, experiences, programs, systems and other
vehicles that enable the organization to operate effectively and efficiently on an ongoing basis. This
criterion includes the ability to deliver functionality/enhancements based on the product roadmap. For
SaaS offerings, Gartner will evaluate the vendor’s ability to manage operational infrastructure
requirements and to provide postsales usage and adoption support.

Table 1: Ability to Execute Evaluation Criteria

Evaluation Criteria Weighting

Product or Service High

Overall Viability Medium

Sales Execution/Pricing Medium

Market Responsiveness/Record High

Marketing Execution Medium

Customer Experience High

Operations Medium

Source: Gartner (January 2019)

Completeness of Vision
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Market Understanding: The ability of the vendor to understand buyers’ needs and translate these
needs into products and services for the SPM market. Vendors that show the highest degree of vision,
listen and respond to buyers’ current demands with innovation and consistent product
enhancements. They also have a clearly defined product roadmap for achieving that vision. Vendors
demonstrate a strategic understanding of SPM capability trends, including operational efficiencies,
planning processes, sales representative effectiveness, and go-to-market strategic alignment. In
addition, the vendor demonstrates an understanding of SPM positioning with buyers’ overall CRM,
SFA, FP&A and ERP strategies.

Marketing Strategy: The vendor’s ability to provide a clear, differentiated set of relevant SPM
messages, consistently communicated throughout the organization and externalized through the
website, social media, advertising, customer programs and positioning.

Vendors are evaluated on their customer segmentation strategies and their ability to communicate
with those segments. Vendors will also be evaluated on their thought-leadership programs and their
vision for customer success.

Sales Strategy: The strategy for selling SPM solutions that uses the appropriate network of direct and
indirect sales, marketing, service and communication affiliates, which extend the scope and depth of
market reach, skills, expertise, technologies, services and the customer base.

Evaluation of vendors is based on their vision for employing direct sales teams, resellers, system
integrators and independent software vendors. Vendors will also be evaluated on their ability to sell to
operational leaders, line-of-business leaders and IT leaders.

Offering (Product) Strategy: Vendors must demonstrate a vision for SPM core and near-core
capabilities that crosses the breadth and depth of the SPM market. This is critical for meeting the
needs of a maturing market. The product strategy can be a combination of organic development,
acquisition and/or ecosystems. However, for ecosystems, Gartner pays close attention to the quality
and support of third-party vendors.

Gartner will evaluate product vision for core SPM capabilities: sales incentive management, quota
management and territory management. This includes standard out-of-the box reporting (sales
representative statements and detail reports, management reports and detail, and so on). Vendors will
also be evaluated on their near-core SPM capabilities: objectives management, territory planning,
quota planning, advanced analytics (such as predictive, prescriptive, ML and benchmarking),
gamification, and sales comparative benchmarking. Vendors will also be evaluated on platform
capabilities, integration with back-office systems (such as CRM, ERP, FP&A, HCM and payroll), and
third-party application marketplaces.

Business Model: Vendors have a clear business plan for how they will be successful in the SPM
market. These business plans should include appropriate levels of investment to achieve profitability
and healthy revenue growth during a three- to five-year period. Sales channel and partnership
strategies are important considerations in this criterion.

Vertical/Industry Strategy: The vendor’s strategy to direct resources, skills and offerings to meet the
specific needs of verticals.

Innovation: Vendors must demonstrate a commitment to investment and development in new SPM
areas such as planning, advanced analytics, best practices and complimentary process extensions.

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Geographic Strategy: The vendor’s alignment of resources, skills and offerings to meet the specific
needs of geographies outside the “home” or native geography, either directly or through partners,
channels and subsidiaries, as appropriate for that geography and market.

Table 2: Completeness of Vision Evaluation Criteria

Evaluation Criteria Weighting

Market Understanding High

Marketing Strategy Medium

Sales Strategy Medium

Offering (Product) Strategy High

Business Model Medium

Vertical/Industry Strategy Low

Innovation High

Geographic Strategy Medium

Source: Gartner (January 2019)

Quadrant Descriptions

Leaders
Leaders demonstrate a market-defining vision of how SPM technology can help top-line business
executives achieve their business objectives. Leaders have the ability to execute against that vision
through both products and services. They have demonstrated solid business results in the form of
revenue and earnings. Leaders have significant successful customer deployments in North America
(the largest adopter of this technology). They have a global presence in a wide variety of industries,
with proof of organizational deployments above 500 users. Leaders are often what other providers in
the market measure themselves against.

Challengers

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Challengers are often (but not always) larger than the Niche Players, and they demonstrate a higher
volume of new business for SPM. These vendors have the size to compete worldwide, but may not be
able to execute equally well in all geographies. They understand the evolving needs of a sales
organization, but despite their strong functional vision they may not lead customers into new
functional areas. Challengers tend to have a good technological vision for architecture and other IT
organizational considerations. However, they have not won the hearts and minds of top sales
executives and/or application leaders.

Visionaries
Visionaries are ahead of most competitors in delivering innovative products and/or delivery models.
They anticipate emerging and changing sales needs, and move the market into new areas. They
influence the direction of the SPM market, but they are limited in terms of sales execution, operational
execution or a consistent record of customer success.

Niche Players
Niche Players offer products with SPM functionality; however, they may lack some functional
components. They may not demonstrate an ability to consistently handle deployments of more than
500 users across multiple geographies. And, they may lack strong business execution in the SPM
market on a large scale. Niche Players may offer portfolios for a specific industry or software
ecosystem. They demonstrate weaknesses in one or more important area with regard to supporting
cross-industry requirements such as product functionality for core SPM. They may exhibit deficits
regarding planning, advanced analytics or objectives management/gamification. Despite these
shortcomings, Niche Players often offer the best solutions to meet the needs of particular sales
organizations, industries or organizational sizes, in terms of the price-to-value ratio of their solutions.

Context
This Magic Quadrant covers a wide cross section of vendors, including those that offer different
delivery models — such as on-premises, hosted, hybrid and SaaS. Vendors in the SPM market will have
differing levels of functional breadth and sophistication.

Whichever provider you are considering, ask yourself:

“Will this vendor help my sales organization sell more effectively?”

“Will my sales compensation team become more efficient and effective using the tools the
vendor provides?”

“Does my team have the skills to use the tools provided by the vendor?”

“Is the vendor able to meet all of my priority business requirements?”

In many cases, a sales organization must evaluate not just a vendor’s suite of product offerings, but
also the ecosystem of providers that can fill gaps in that vendor’s capabilities.

Use this Magic Quadrant as one point of reference for your evaluations. It is not intended to be the
sole tool for creating a vendor shortlist. Use it as part of your due diligence and in conjunction with
discussions with Gartner analysts. It is important to explore the market further; to assess the capacity
of each vendor to address your unique business problems and technical concerns. Depending on the
complexity and scale of your requirements, your shortlist may be unique.

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For this Magic Quadrant, Gartner collected end-user data from two sources: interactions with Gartner
clients, and the results of a primary research survey conducted specifically for this Magic Quadrant.
The survey had 98 reference customer respondents, drawn from end-user clients identified by the
software vendors included in this analysis.

Magic Quadrants are snapshots in time. To be fair and complete in its analysis, Gartner stops collecting
data for Magic Quadrants at a consistent time. For this Magic Quadrant, the cutoff date was 25
September 2018.

Market Overview
The SPM market continued to grow and mature in 2018, reaching revenue of $950 million. At 12.9%,
the growth in SPM slightly lags behind that of sales force automation (at 15.3%), as well that of the
overall sales segment (at approximately 16.6%). While the vendors in the SPM space have maturing
products in a mature segment, they also continue to innovate and introduce new technologies,
particularly AI. This segment has helped lift the overall growth of the CRM segment. Using the forecast
for sales software, we see a projected growth rate of 12.5% for SPM for the next five years to 2022. It
is likely that this growth will be driven by a number of factors, including advanced analytics techniques
and AI (see “Forecast Overview: CRM Software, Worldwide, 2018 Update”).
All of today’s commercial products have the critical capabilities necessary to automate commission
calculations and processes to various degrees (see “Critical Capabilities for Sales Performance
Management”). The depth and breadth of these capabilities therefore becomes the main capabilities’
differentiator. Application leaders must assess the skill set of the commission team against a product’s
technical skill set requirements. They should also evaluate the corporate culture of their organization
in line with that of the vendor, to ensure a good fit. This will increase success in the deployment and
automation of the execution of commission processes.
Incentive compensation management continues to be the No. 1 reason why buyers purchase an SPM
solution. Nearly all potential buyers that Gartner has spoken with want to purchase SPM as a SaaS
solution; only 3% were seeking an on-premises option. Automating incentive compensation as Phase 1
of your SPM deployment provides an immediate ROI in cost savings and efficiency alone. Ten percent
of organizations that have benchmarked revenue found this solution provided an increase in revenue.1
Quota and territory planning should be deployed as Phase 2 in order to complete a full SPM
deployment. This phasing will ensure optimized and accurate territories and quotas, providing a more
achievable and accurate forecast that the business can incorporate into its overall planning. Continued
innovation in the SPM market can be seen in four areas: planning, connections, AI/ML algorithms and
the user experience.

Incorporating Quota and/or Territory Planning Will Drive Better Business Outcomes

The second phase of an SPM deployment usually includes planning; largely, quota planning. However,
those in the manufacturing and life sciences industries often start with territory planning, given the
pace of change and complexity. Deciding on the most suitable quota or territory assignment needed
to achieve the corporate goals, then creating those assignments using top-down and bottom-up
approaches, requires collaboration. These processes have generally been largely manual, using
Microsoft Excel and email as the main tools. Collaboration and workflow provided by SPM vendors can
be applied to automate and streamline the process, providing audit and tracking that will assist with
compliance issues. SPM vendors offer planning capabilities with advanced functions such as
smoothing and seasonality. They are applying ML algorithms to balance and optimize territory
assignments or provide optimized quotas.

Recommendations:

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 Application leaders should review vendor capabilities in these areas to provide additional value
to the execution of SPM compensation plans. In many cases, planning can be purchased as a
stand-alone offering, or incorporated/bundled with incentive compensation management.
Vendors who provide planning as an additional module or separate product must be vetted for
integration with incentive compensation management.

It is also important to make sure the UI has been streamlined with the incentive compensation
module, to avoid additional complexity for users.

Create Synergies by Connecting SPM to Other Execution Solutions

SPM has a natural fit with SFA tools such as CRM, financial planning and analysis (FP&A), sales
enablement and CPQ. Connecting the initial budget and revenue plan to the proper planning and
setting of territories and quotas provides a more accurate initial picture for the business. It should be
tracked and modified as needed through the plan year. Tying the sales forecast to quotas will ensure
that the plan can be met, or tweaked to provide a more accurate picture of the business. Surfacing
commission estimates in the quoting system can drive the sales reps’ behavior toward more optimal
quotes. It should increase the value of deals and lead to improved sales rep performance. Sales
enablement surfaced through the SFA can provide prescriptive advice with guided selling. Training will
help with onboarding, getting new reps up to speed more quickly. Continuous education of more
tenured reps can also help to improve their proficiency and close more qualified opportunities. The
reps’ performance can be tracked through compensation plans, to monitor and analyze execution.
This will provide the business with regular indicators if performance is slipping, or goals are being
exceeded, and why. Sales reps are likely to provide more accurate information during the sales
execution process. This is because they can see a more holistic picture of their opportunities and
estimates on commissions at various stages of the deal cycle, such as quotes or opportunities in the
CRM tool. Any movements can be corrected or adjusted, providing the business with the necessary
information to perform better. Connecting SPM to these systems enables:

Monitoring and tracking of execution

Providing a feedback loop to planning

Creating a more accurate picture of the business and its performance against the corporate
goals

Recommendation:

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 Application leaders should work with the lines of business to facilitate the connection between
SPM and other SFA and planning tools. This will provide a holistic view and a more accurate
sales forecast:

Connecting SPM with FP&A tools to plan — based on the budget and revenue plan — to
the quota and territory plan is essential for an accurate forecast.

Connecting the sales forecast to the compensation plans increases the accuracy of the
commission accrual forecast. This will provide a more accurate overall view of upcoming
business.

Connecting to CPQ via estimation widgets helps provide optimal deal configuration and
produces better results for sales reps, thereby contributing to the revenue of the
organization.

Connecting SPM with the sales enablement process will provide more optimized sales
and increase the proficiency of sales reps.

Connecting other information, such as HR data related to tenure and position, or sales
enablement data such as training and coaching results. This forms a more complete view
to properly optimize territories and quotas.

The compensation plan design must be focused to drive behavior, and monitored and tracked to
ensure results reflect the corporate goals — thereby leading to optimized performance. Analytics will
allow faster data-driven decisions to be made with regard to adjustments and planning for future
periods. A closed-loop feedback to the planning process will ensure that all departments are aligned on
a path to accurate business forecasts and results.

SPM Vendors Offer Improved Machine Learning and Advanced Algorithms

These offerings support predictive and prescriptive analytics, benchmarking and visualizations for the
optimization of compensation plans and processes. Natural language processing of requests, which
yield data visualization, and inquiry responses that include bots, are being developed and deployed by
the vendors to assist with compensation plan optimization and next-best actions for sales reps. These
functions aid the optimization of plan design and processes around compensation, as well as planning
for and predicting the future based on data. Such functions should also assist reps in focusing on
business that will drive revenue and drive the behavior designed by the compensation plans. Gartner
expects to see continued innovation in this area, including the use of bots for dispute resolution to
increase effectiveness.

Recommendations:

Application leaders should describe specific use cases, such as dispute resolution for end users.
If these capabilities are not available today, look to understand the roadmap for the vendor.

For compensation administrators, specific cases such as optimal discount rate, expected plan
performance, or plan metrics recommendations (given a use case or recommendations for
business processes) should be evaluated.

Look for the vendor’s ability to provide transparency into the predictive results and prescriptive
recommendations, to ensure confidence and validation by your end users.

Improved User Experience

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Gartner has noted that vendors have mostly refreshed their end user (sales rep and manager) UIs to
improve ease of use and provide a modern experience. The sales rep and sales manager experience
now looks more like social applications. While administrative UIs have been ignored for years, there
are now the beginnings of more modern and usable UIs from many vendors. Vendors will need to
improve UIs to help administrators be more productive and efficient, while providing a more friendly
and easy-to-use experience. The No. 1 issue identified by administrators (during Gartner inquiries in
this area) is that even with packaged software, compensation is hard and the software isn’t making it
easier. If administrators are struggling with the mechanics of compensation plans and processing, they
aren’t able to focus on value-added activities such as analytics and modeling/planning. To achieve a
good ROI, administrators must have more time to focus on these activities, which provide value to the
organization.

Recommendations:

Compile requirements from the compensation team for the evaluation process, to ensure that
the solution is usable and will improve efficiency and productivity for administrators.

Facilitate workshops with finalist vendors (two at most) so that administrators can get “hands
on” with the product. This will reveal if they have the skills to manage the solution, and whether
they feel confident it will improve the commission process.

Acronym Key and Glossary Terms

AI artificial intelligence

ASC Regulation relating to revenue from contracts with customers; issued

606 jointly by the Financial Accounting Standards Board (U.S.) and the
International Accounting Standards Board.

CPQ configure, price and quote

CRM customer relationship management

EMEA Europe, the Middle East and Africa

ERP enterprise resource planning

ETL extraction, transformation and loading

FP&A financial planning and analysis

ICM incentive compensation management

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 IFRS International Financial Reporting Standard 15 (International Accounting
15 Standards Board) provides guidance on accounting for revenue from
contracts with customers.

LOB line of business

ML machine learning

MLM multilevel marketing

NLP natural-language processing

QM quota management

ROI return on investment

SFA sales force automation

SPM sales performance management

TM territory management

UI user interface

Evidence
Gartner collected input from 98 reference customers identified by the vendors in this Magic Quadrant,
using a formal online survey. We also gathered information from several hundred inquiries from
Gartner clients evaluating the vendors’ products, as well as independent customer conversations at
conferences and events. Vendors in this Magic Quadrant were also interviewed, and Gartner attended
briefings and in-depth product demonstrations.

1 According to respondents to the question — “Please indicate the types of measurable business
benefits your organization has realized with your vendor?” — as part of our customer reference survey
for this Magic Quadrant (n = 68).

Evaluation Criteria Definitions

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Evaluation Criteria Definitions

Ability to Execute
Product/Service: Core goods and services offered by the vendor for the defined market. This includes
current product/service capabilities, quality, feature sets, skills and so on, whether offered natively or
through OEM agreements/partnerships as defined in the market definition and detailed in the
subcriteria.

Overall Viability: Viability includes an assessment of the overall organization's financial health, the
financial and practical success of the business unit, and the likelihood that the individual business unit
will continue investing in the product, will continue offering the product and will advance the state of
the art within the organization's portfolio of products.

Sales Execution/Pricing: The vendor's capabilities in all presales activities and the structure that
supports them. This includes deal management, pricing and negotiation, presales support, and the
overall effectiveness of the sales channel.

Market Responsiveness/Record: Ability to respond, change direction, be flexible and achieve

competitive success as opportunities develop, competitors act, customer needs evolve and market
dynamics change. This criterion also considers the vendor's history of responsiveness.

Marketing Execution: The clarity, quality, creativity and efficacy of programs designed to deliver the
organization's message to influence the market, promote the brand and business, increase awareness
of the products, and establish a positive identification with the product/brand and organization in the
minds of buyers. This "mind share" can be driven by a combination of publicity, promotional
initiatives, thought leadership, word of mouth and sales activities.

Customer Experience: Relationships, products and services/programs that enable clients to be

successful with the products evaluated. Specifically, this includes the ways customers receive technical
support or account support. This can also include ancillary tools, customer support programs (and the
quality thereof), availability of user groups, service-level agreements and so on.

Operations: The ability of the organization to meet its goals and commitments. Factors include the
quality of the organizational structure, including skills, experiences, programs, systems and other
vehicles that enable the organization to operate effectively and efficiently on an ongoing basis.

Completeness of Vision
Market Understanding: Ability of the vendor to understand buyers' wants and needs and to translate
those into products and services. Vendors that show the highest degree of vision listen to and
understand buyers' wants and needs, and can shape or enhance those with their added vision.

Marketing Strategy: A clear, differentiated set of messages consistently communicated throughout

the organization and externalized through the website, advertising, customer programs and
positioning statements.

Sales Strategy: The strategy for selling products that uses the appropriate network of direct and
indirect sales, marketing, service, and communication affiliates that extend the scope and depth of
market reach, skills, expertise, technologies, services and the customer base.

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Offering (Product) Strategy: The vendor's approach to product development and delivery that
emphasizes differentiation, functionality, methodology and feature sets as they map to current and
future requirements.

Business Model: The soundness and logic of the vendor's underlying business proposition.

Vertical/Industry Strategy: The vendor's strategy to direct resources, skills and offerings to meet the
specific needs of individual market segments, including vertical markets.

Innovation: Direct, related, complementary and synergistic layouts of resources, expertise or capital
for investment, consolidation, defensive or pre-emptive purposes.

Geographic Strategy: The vendor's strategy to direct resources, skills and offerings to meet the
specific needs of geographies outside the "home" or native geography, either directly or through
partners, channels and subsidiaries as appropriate for that geography and market.

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