"Actual use cases are still diverse, narrow in scope, and unevenly diffused across companies, with experimentation that, most times forgoes measuring business benefits," the analysts wrote in the introduction to their Gartner Magic Quadrant analysis. "Most vendors remain small and unprofitable, although many grew 50% to 100% in 2010."
The report suggests successful Social CRM vendors will have to demonstrate clear business benefits and be flexible enough to work across multiple departments because deployments are spread across marketing, sales, and customer service organizations, with many organizations having yet to decide who should be in charge.
This category includes products for managing user communities on a company's own website, engaging with consumers and soliciting their feedback, as well as monitoring and analyzing customer activity on public social networks. Consumer-oriented applications of Social CRM account for 90% of its use, but business-to-business applications are growing faster and Gartner predicted they will account for 30% of usage by 2012.
Gartner categorized Bazaarvoice as a "challenger," recognizing its ability to execute within its narrower focus on providing shopping-oriented social widgets such as its Ratings & Reviews product. Attensity and Telligent were recognized as "visionaries," ranked high for vision but not quite as high as the leaders on execution.
Spending on Social CRM software increased by 40% in 2010, but Social CRM remains less than 5% of the total CRM application market, Gartner said. Gartner projects the Social CRM market to top $1 billion by the end of 2012, up from about $625 million in 2010.
Gartner said it is tracking more than 100 vendors with Social CRM products, but most of the companies are small and unprofitable. Its ranking was limited to those with $10 million or more in sales and at least five client references, among other criteria.
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