Magic Quadrant for Master Data Management of Customer Data Solutions - 2013

8/12/2019 Magic Quadrant for Master Data Management of Customer Data Solutions - 2013

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3/22/2014 Magic Quadrant for Master Data Management of Customer Data Solutions

http://www.gartner.com/technology/reprints.do?id=1-1LXAP6W&ct=131017&st=sb&mkt_tok=3RkMMJWWfF9wsRoiu6TOZKXonjHpfsX66OoqWaCwlMI%2F0E 1

Magic Quadrant for Master Data Managementof Customer Data Solutions

17 October 2013ID:G00251784

Analyst(s): Bill O'Kane, Saul Judah

VIEW SUMMARY

The MDM of customer data solutions market segment grew healthily in 2012. New acquisitions and

integrations of prior acquisitions by the Leaders have continued, and several visions for linking MDM

and social data have emerged. This Magic Quadrant will help you find the right vendor for your

needs.

Market Definition/Description

Markets are sets of potential buyers that view a product as so lving a common, identified need, and

that reference each other. Market segments are portions of a market that are qua lified by moreexact criteria, thus grouping potential buyers more tightly. Segmentation may take two forms:

A generic market may be divided into recognizable submarkets, where the same rules prevail

for defining a market.

An individual vendor may segment a market to target its products more precisely and

differentiate itself from (or avoid competing with) other players that address the same overall

market. However, the targeted buyers may not know they are part of the same market

segment. Such segmentation will not be reflected explicitly in this Magic Quadrant, although it

may be reflected implicitly for example, via placementof a vendor in the Niche Players

quadrant.

Master data management (MDM) is a technology-enabled dis cipline in which business and IT teams

work together to ensure the uniformity, accuracy, stewardship, semantic consistency and

accountability of their enterprise's o fficial, shared master data as sets. Master data is the consistent

and uniform set of identifiers and extended attributes that describes the core entities of an

enterprise, such as customers, prospective clients, citizens, suppliers, sites, hierarchies and the

chart of accounts.

MDM of customer data solutions are software products that:

Support the global identification, linking and synchronization of customer information across

heterogeneous data sources through semantic reconciliation of master data

Create and manage a central, database-based system of record or index of record for master

data

Enable the delivery of a single customer view (for all stakeholders) in support of various

business benefits

Support ongoing master data stewardship and governance requirements through workflow-

based monitoring and corrective action techniques

MDM implementations and their requirements vary in terms of:

Instantiation of the customer master data varying from the maintenance of a physical

"golden record" to a more virtual, metadata-based, indexing structure

The usage and focus of customer master data ranging across use cases for design

(information architecture), construction (building the business), operations (running the

business) and analytics (reporting the bus iness)

Different organizations' structures spanning small, centralized teams through to global,

distributed organizations

The latency and accessibility of the customer master da ta varying from real-time,

synchronous reading and writing of the master data in a transactional scenario between

systems, to message-based, workflow-oriented scenarios o f distributed tasks across the

organization, and legacy-style batch interfaces moving master data in bulk file format

Organizations use MDM of customer data solutions as part of an MDM strategy, which in itself

should be part of a wider enterprise information management (EIM) strategy. An MDM strategy

potentially encompasses the management of multiple master data domains, such as customer,

product, asset, person or party, supplier and financial masters. As the name suggests, MDM of

customer data solutions focuses on managing customer data a form of "party" data, whereas

EVIDENCE

The analysis in this document is based on

information from a num ber of sources, including,

but not limited to:

Extensive data on functional capab ilities,

customer base demographics, financial status,

pricing and other quantitative attributes

gained via a "request for information" process

engaging vendors in this market segment.

Interactive briefings in which the vendors

provided Gartner with updates on their

strategy, market positioning, recent key

developments and product road map.

A telephone and Web-based survey ofreference custome rs provided by each vendor,

which captured data o n usage patterns, levels

of satisfaction with major product functionality

categories, various nontechnology vendor

attributes (such as pricing, product suppo rt

and o verall service delivery), and mo re. In

total, 109 organiza tions across all major world

regions provided input on their experiences

with vendors and tools in this manne r.

Feedback about tools and vendors captured

during conversations with users of Gartner's

client inquiry service.

Market share a nd revenue growth estimates

developed by Gartner's Technology and

Service Provider research unit.

NOTE 1DEFINITIONS OF MULTIDOMAIN AND

MULTIVECTOR MDM TECHNOLOGIES

Multidomain MDM technology is purpose-built to

address the multidomain requirements of an

MDM program. It has the following characteristics:

It can be implemented in a single instance.

The data model is uniform or interoperable

and able to m anage cross-domain

intersections.

The workflow and UI e leme nts are uniform or

interoperable.

It supports at least one use case,

implementation style and

organization/governance model, for specific

industry scenarios.

Multivector MDM solutions provide a n integrated

set of facilities fo r ensuring the uniformity,

accuracy, stewardship, semantic consistency and

accountability of an enterprise's official, shared

master data assets. These meet the needs of the

business across all five vectors of MDM

complexity:

Industries for e xam ple, p roduct-centric

industries, service industries and government

MDM data domains for example, customer,

supplier, pa rtner, location, product, item,

material, asse t, ledger, account, person and

employee

MDM use cases for example,

design/construction, ope rational and analytical

Organizational s tructures for exam ple,

centralized, federated and localized

organizations

MDM implementation styles for example,

registry, consolidation, coexistence and

centralized

Multivector MDM solutions contain comprehensive
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MDM of product data focuses on managing product data a form of "thing" data. There are no

discrete Magic Quadrants for other master data domains due to the relatively low level of interest in

discrete solutions to govern those data domains in comparison w ith the customer and product data

domains.

We a re routinely asked whether we have an overall MDM Magic Quadrant. We do not. We still

believe that such a Magic Quadrant would be premature, because MDM needs are very diverse (see

"The Five Vectors of Complexity That Define Your MDM Strategy"), leading to different market

segments, and most evaluation and buying activity still focuses on initiatives for specific master

data domains. In addition, although many MDM solutions are marketed as "multidomain MDM," they

do not always conform to our definition of multidomain MDM technology (see Note 1) and we find

that they have many gaps in their capabilities for, and experience of, handing every data domain

(see "MDM Products Remain Immature in Managing Multiple Master Data Domains").

This Magic Quadrant provides insight into the segment of the constantly evolving packaged MDM

system market that focuses on managing customer data to support CRM and other customer-

related strategies. It positions relevant technology providers on the basis of their Completeness of

Vision relative to the market, and their Ability to Execute on that vision.

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Magic Quadrant

Figure 1.Magic Quadrant for Master Data Management of Customer Data Solutions

Source: Gartner (October 2013)

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Vendor Strengths and Cautions

IBM (InfoSphere MDM Advanced Edition)

IBM (www.ibm.com) is headquartered in Armonk, New York, U.S. IBM's InfoSphere MDM Advanced

Edition (AE) version 11 achieved genera l availability (GA) in June 2013. IBM's total MDM software

revenue in 2012 (estimated for all products and domains) was $311.6 million, of which $132 million

was for AE for customer data. IBM's total MDM customer count in March 2013 (estimated for all

products and domains) was over 800, of which 250 were for AE for customer data.

Strengths

Broad information management strategy:At IBM, MDM is central to a much broade r big data

and information management (IM) strategy and platform. This is attractive for large

organizations looking for a w ide range of IM capabilities from one vendor.

facilities for data m odeling, da ta quality, data

stewardship, data g overnance, data services, and

data integration in workflow and transactional

usage scenarios. They also offer high levels of

scalability, availability, manag eability and

security.

NOTE 2REFERENCE SURVEY

As part of the Magic Qua drant research process,

we s ought the views o f vendo rs' reference

customers via a survey conducted o nline and via

telephone. The survey included requests for

feedback on vendor maturity (for example,understanding industries, provision of innovation,

responsiveness to ne w requests, TCO and pricing)

and product capabilities (for example, flexibility

in data mo deling, suppo rt for data quality, UI

support for d ata stewardship, internal workflow

and support for m ultiple architectural styles).

Over 160 organizations, representing a ll the

featured vendors' reference ba ses, were

contacted for this survey. Unsurprisingly, the

reference customers were g enerally plea sed with

their vendors and p roducts, but they ga ve

relatively low marks in some areas, which we have

detailed in the analysis of each vendor. Some of

the issues may be historical, as not all

organizations a re on the latest product versions.

EVALUATION CRITERIA DEFINITIONS

Ability to Execute

Product/Service: Core goods and services

offered by the vendor for the defined m arket.

This includes current product/service capab ilities,

quality, feature sets, sk ills and so on, whether

offered na tively or through O EM

agreements/partnerships as defined in the

market definition and detailed in the subcriteria.

Overall Viability: Viability includes an assessment

of the overall o rganization's financial health, the

financial and practical success of the b usiness

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 po rtfolio o f products.

Sales Execution/Pricing: The vendor's capabilities

in all p resales a ctivities a nd the s tructure that

supports them. This includes deal management,pricing and ne gotiation, presales sup port, and the

overall effectiveness of the sales channel.

Market Responsiveness/Record: Ability to

respond, change direction, be flexible and

achieve competitive success a s opp ortunities

develop, comp etitors act, customer needs e volve

and ma rket dynamics change. This criterion also

considers the vendor's history of responsiveness.

Marketing Execution: The clarity, quality,

creativity and efficacy of programs d esigned 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, promotiona l initiatives, thought

leade rship, word of mo uth and sales activities.

Customer Experience: Relationships , products

and se rvices/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 a ncillary tools, customer support

programs (and the q uality thereof), availability of

user groups, service-level agreements and so on.

Operations: The ab ility of the organization to

mee t its goals and com mitments. Factors include

the quality of the organiza tional structure,

including skills, experiences, programs, systems

and other vehicles that enable the organiza tion to

operate effe ctively and efficiently on an o ngoing

basis.

Completeness of Vision

Market Understanding: Ability of the vendor to

understand buyers' wants and nee ds and to
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Product strategy and vision:AE is the lead IBM product for customer and multidomain MDM

and has strengths in multiple MDM styles. IBM is delivering on the convergence of its legacy

products into functional "editions." The included Master Data Governance facility has improving

stewardship facilities, and IBM is building capabilities to link MDM and big data.

Robust data model and services:AE has a robust, extensible party data model. It can model

other domains, and some industry-specific extensions are available. Reference customers gave

high scores for industry understanding, governance support, integration and performance.

Cautions

Momentum slowing:IBM's overall MDM software revenue growth slowed to an estimated

3.5% in 2012, spread evenly across all data domains, and estimates suggest that revenue

growth slowed significantly for AE.

Perceived as complex:AE appears in many of the client inquiries and competitive situationsreceived and discussed by Gartner, but it is o ften seen as a having a larger technical footprint

than its competitors.

Reference survey concerns:A below-average number of AE reference customers responded

to Gartner's survey, and they gave below-average scores for total cost of ownership (TCO),

workflow and reporting.

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IBM (InfoSphere MDM Standard Edition)

IBM (www.ibm.com) is headquartered in Armonk, New York, U.S. IBM's InfoSphere MDM Standard

Edition (SE) version 11 achieved GA in June 2013. IBM's total MDM software revenue in 2012

(estimated for all products and domains) was $311.6 million, of which $71 million was for SE for

customer data. IBM's total MDM customer count in March 2013 (estimated for all products and

domains) was over 800, of which 350 were for SE for customer data.

Strengths

Broad IM strategy:At IBM, MDM is central to a much broader big data and information

management (IM) strategy and platform. This is attractive for larger organizations looking to

source a w ide range of IM capabilities from one vendor.

Unique offering:SE is a robust product oriented around a registry-based implementation s tyle

with an a ttributed, extensible data model and pow erful matching and data management

functions; it has a large roster of satisfied clients.

Strong performance and industry focus:SE has strong proof points for extremely high

volumes of business-to-consumer (B2C) data, with subsecond latency and high transaction

rates. SE is very strong in the healthcare market where registry is a common requirement, and

it continues to do well in the government sector where complexity in application landscapes

lends itself to the registry style.

Cautions

Momentum slowing:IBM's overall MDM software revenue growth slowed to an estimated

3.5% in 2012, spread evenly across all data domains, and estimates suggest that revenuegrowth slowed significantly for SE.

Limited implementation:SE is limited to the registry style. Users needing other styles should

consider IBM's AE or other vendors' offerings.

Reference survey concerns:References gave SE below-average scores for industry

understanding, new feature responsiveness, pricing transparency, workflow and reporting.

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Informatica

Informatica (www.informatica.com) is headquartered in Redwood City, California, U.S. Informatica's

MDM 9.6 achieved GA in June 2013. Informatica's total MDM software revenue in 2012 (estimated)

was $85 million, of which $70 million was for customer data. Informatica's total MDM customer count

in March 2013 (estimated) was 259, of which 245 were for customer data and 180 were for multiple

data domains.

Strengths

Multidomain and broad IM capabilities:Informatica MDM is party-data-oriented, but can

readily model other data domains. Reference customers cite data model flexibility as its main

strength. A planned end-of-2013 release w ill eliminate database management system stored

procedures, providing da tabase independence. Informatica has highly rated data quality and

data integration tools.

Continued investment:In 2012 and 2013, Informatica acquired Data Scout, now positioned

as the Informatica Cloud MDM solution, though this supports only the salesforce.com platform;

Heiler Software, an MDM of product data vendor; and Active Endpoints, a vendor of business

process management software (BPMS). Informatica also continues to invest substantially in

core MDM development.

Recovered momentum:Following early missteps, Informatica has recovered to be considered

in twice the proportion of competitive situations of any other vendor, as reported by a ll survey

respondents for this Magic Quadrant. At just under 7%, its revenue growth in the customer

data market in 2012 was above the market average, though less than in 2011.

translate those into p roducts a nd se rvices.

Vendors that show the highes t degree o f vision

listen to and und erstand buyers' wants and

needs, a nd can shape or enhance those with their

added vision.

Marketing Strategy: A clear, differentiated set o f

messages consistently communicated throughout

the organization and e xternalized through the

website, a dvertising, customer programs and

positioning statements.

Sales Strategy: The s trategy for se lling products

that uses the appropriate network o f direct and

indirect sales, m arketing, service, and

communication affiliates that extend the scope

and depth of market reach, skills, expertise,

technologies, services and the customer base.

Offering (Product) Strategy: The vendor's

approach to product development and d elivery

that empha sizes 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 d irect resources, s kills and offerings to

meet the specific needs of individual market

segm ents, including vertical markets.

Innovation: Direct, related, complem entary and

synergistic layouts of resources, exp ertise or

capital for investment, consolidation, de fensive or

pre-emptive purposes.

Geographic Strategy: The vendo r's strategy to

direct resources, sk ills and o fferings to mee t thespecific needs of geographies outside the "home"

or native ge ography, either directly or through

partners, channels and subsidiaries as

appropriate for that geography and ma rket.
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Cautions

Portfolio strategy:Informatica's "Universa l MDM" vision, including its Heiler acquisition, is still

emerging. The company must act decisively to avoid having a "disparate MDM products"

message used aga inst it by megavendors, which are reso lving this issue in their own

portfolios, and smaller competitors.

Lack of packaged governance technology for MDM:Informatica has opted to market the use

of its current product suite to enab le master data governance. Organizations that des ire a

packaged so lution to master data governance should ensure they understand Informatica's

approach.

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Oracle (CDH)Oracle (www.oracle.com) is headquartered in Redwood Shores, California, U.S. Oracle's Customer

Data Hub (CDH) version 12.2 achieved GA in September 2013. Oracle's total MDM software revenue

in 2012 (estimated for all products and domains) was $243 million, of which $28 million was for

CDH. Oracle's MDM customer count in March 2013 (estimated for all products and domains) was

1,550, of which 360 were for CDH.

Strengths

Strong MDM portfolio:Oracle has a broad range of MDM assets for multiple domains and use

cases. Revenue growth for MDM of customer data was an estimated 10% in 2012.

Good fit for E-Business Suite clients:CDH is sold to users of Oracle's E-Business Suite

applications, and appeals to B2B-oriented users and o thers with modest data volumes.

Good packaged data model and improving functionality:Oracle CDH has a rich party data

model, derived from the E-Business Suite. CDH is increasingly drawing on more components of

Oracle Fusion Middleware and the evolving standard MDM technology platform.

Cautions

Restricted positioning:Sales of CDH are generally restricted to E-Business Suite users. Siebel

Universal Customer Master (UCM) is Oracle's lead MDM offering for customer data; with Fusion

MDM slowly ramping up, CDH has virtually disappeared from our client interactions.

Lagging functionality:CDH has fallen behind Siebel UCM and best-in-class vendors in a

number of areas, including data quality technology, data governance facilities and hierarchy

management.

Reference survey concerns:As for 2012's Magic Quadrant, Oracle did not submit references

for CDH. In prior years, multiple reference customers reported performance issues when

mastering over 100,000 customer records in the hub.

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Oracle (Siebel UCM)

Oracle (www.oracle.com) is headquartered in Redwood Shores, California, U.S. Oracle's SiebelUniversal Customer Master (UCM) version 8.2 81110FP achieved GA in March 2013. Oracle's MDM

software revenue in 2012 (estimated for all products and domains) was $243 million, of which $82

million was for UCM. Oracle's MDM customer count in March 2013 (estimated for all products and

domains) was 1,550, of which 330 were for UCM.

Strengths

Strong MDM portfolio:Oracle has a range of MDM solutions spanning multiple domains and

industries. Revenue growth for MDM of customer data was an estimated 10% in 2012.

Lead Oracle offering:UCM is Oracle's lead product for MDM of customer data. New features

include Open UI for UCM and improved integration with Oracle's Enterprise Data Quality

Management (EDQM) suite. Reference customers awarded high scores for UCM's road map

visibility and support for multiple styles of MDM.

Strong verticalization and scalability:UCM supports Oracle's Customer Experience (CX)

strategy and has versions supporting several industries. It has live transactional workloads

managing more than 100 million consumers.

Cautions

Unclear direction:Fusion MDM is not sold aggressively for MDM of customer data; prospective

customers are uncertain whether to invest in UCM or Fusion MDM. Fusion MDM did not earn

sufficient revenue in 2012 to be included in this analysis.

Not designed for multidomain:Siebel UCM is based on a packaged party model; although it is

robust and extensible, its architecture often excludes it from multidomain evaluations.

Requires high-level vendor support:Some reference customers reported that securing

access to UCM's product management team at Oracle was a critical success factor for their

implementation.

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Orchestra Networks

Orchestra Networks (www.orchestranetworks.com, www.smartdatagovernance.com) is
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headquartered in Paris, France. Orchestra's EBX5 version 5.4 achieved GA in October 2013.

Orchestra's MDM software revenue in 2012 (estimated) was $10.7 million, of which $5.3 million was

for customer data. Orchestra's MDM customer count in March 2013 (estimated) was 90, of which 37

were for customer data.

Strengths

Strong sales momentum:Orchestra's revenue grew by 26% in this market segment in 2012

as it targeted multidomain scenarios, many of which were distinctive within the market. A

cloud-based option is available.

Robust capabilities:EBX5 has flexible browser-based data modeling facilities. It supports

XML-based and relational schemas in a single hub. Reference customers gave EBX5 high

scores in almost every category except data quality reporting.

Supports specialized scenarios:In add ition to reference data and hierarchy management,Orchestra targets specialized multidomain scenarios commonly found in organizations with B2B

business models.

Cautions

Narrow marketing strategy:By targeting niche scenarios, Orchestra has implicitly ceded

mainstream implementations to competitors, when its offering should be quite attractive in

those areas.

Risky sales strategy:Orchestra often sells MDM solutions to function-specific business users

in the belief that these efforts lead to broad IT adoption. This strategy runs a high risk against

larger competitors that are more enterprise-oriented.

Product and partner strategy:Orchestra needs to develop starter templates (data models

and services, UIs, configured rules and metrics) to compete with larger rivals. This requires a

mature partnership model; so far, Orchestra has partnered on an opportunistic basis.

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SAP (MDG-C)

SAP (www.sap.com) is headquartered in Walldorf, Germany. SAP's Master Data Governance for

Customer (MDG-C) version 6.1 achieved GA in December 2012. SAP's MDM of customer da ta

software revenue in 2012 (estimated) was $30 million, of which $25 million was for MDG-C as a

stand-alone hub. SAP's MDM customer count in March 2013 (estimated) was 2,300 licenses, of

which 1,600 were active, 930 were for customer data and 280 used MDG-C as a stand-alone hub.

Strengths

Broad portfolio:SAP sells NetWeaver Master Data Management (for consolidation), MDG (for

centralized) and Information Steward for stewardship support. An MDG Enterprise Edition is

planned for Hana-based customer data in 2014.

Product fit/flexibility:MDG-C is based on the Advanced Business Application Programming

(ABAP) programming language, unlike NetWeaver MDM. Users can support ERP data

management by implementing MDG "inside" Enterprise Central Component (ECC), or "outside"

(but integrated w ith) ECC as an MDM hub, extending the data model for non-SAP data.

Momentum within client base:The share of SAP customer MDM sales attributed to MDG-C

grew from 20% in 2011 to 90% in 2012. The largest portion of this 90% is associated with

MDG-C operating as an MDM hub, as opposed to directly against an ECC ERP system.

Cautions

Sells primarily to SAP's ERP installed base:MDG-C is not sold as a stand-alone or best-of-

breed MDM offering. This is therefore a self-imposed niche market segmentation.

Narrow implementation style support:MDG-C is not appropriate for the consolidated s tyle o f

MDM, and NetWeaver MDM is excluded from this year's analysis due to a substantial slowdow n

in revenue. Until MDG Enterprise Edition becomes available and proven, clients needing

consolidation-style MDM face a difficult decision due to the loss of momentum of NetWeaver

MDM for customer data and the necessity to include SAP Data Services to support this style of

MDM with MDG.

Reference survey concerns:Although interest and uptake appear high, SAP identified very

few reference customers for MDG-C. This may not be entirely attributable to the product itself,

as such a situation often indicates a difficult or complex implementation cycle, frequentlyinvolving multiple data domains.

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SAS

SAS (www.sas.com) is headquartered in Cary, North Carolina, U.S. SAS's Master Data Management

version 3.2 achieved GA in December 2012. SAS's total MDM software revenue in 2012 (estimated)

was $8.6 million, of which $4.2 million was for customer data. SAS's MDM customer count in March

2013 (estimated) was 292, of which 134 were for customer data, 78 of which were using SAS

Master Data Management.

Strengths

Strong internal integration focus:DataFlux qMDM is now SAS Master Data Management, and

a clear investment is being made to integrate it with other SAS products, such as Analytics,

Business Data Network, Data Governance and Customer Intelligence.
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Graduated approach:SAS offers an incremental approach: data quality and integration tools

for custom builds; batch-based MDM for one domain with Master Data Foundations; and two

levels (Standard and Advanced) of SAS Master Data Management.

Solid foundation:SAS Master Data Management has a flexible data model that can model

multiple data domains, though it has the most experience with customer data. It has excellent

data quality and data profiling facilities, and includes a business rule engine.

Cautions

Slowing momentum:Revenue growth in 2012 was negligible in a market that grew by 5.4%.

Similarly, SAS had little presence in Gartner's client interactions.

Internal focus:SAS has recently focused on integrating DataFlux technology into its larger

suite, which may leave it behind its MDM competitors in the short term in areas such as

industry templates, data visualization and big data.

Reference survey concerns:A be low-average number of SAS reference customers responded

to Gartner's survey, and although SAS received high scores for data quality capabilities and

new feature responsiveness, it received low scores for workflow and initial load support, and

for scalability. Enhancements in the MDM release planned for the fourth quarter of 2013

appear to target these concerns.

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Talend

Talend (www.talend.com) is headquartered in Paris, France and Los Altos, California, U.S. Talend's

Platform for Master Data Management version 5.3 achieved GA in June 2013. Talend's total MDM

software revenue in 2012 (estimated) was $8.2 million, of which $5.1 million was for customer data.

Talend's total MDM customer count in March 2013 (estimated) was 63, of which 38 were for

customer data .

Strengths

Broad IM vision:Talend has a broad platform, including highly rated data quality and

integration tools. It can model multiple data domains in the same product. It acquired

enterprise service bus vendor Sopera in 2010 and began an OEM relationship with BPMS

vendor BonitaSoft in 2011.

Increasing revenue and mind share:Talend earned $5 million from the MDM of customer data

market segment in 2012, up from virtually none in 2010. It submitted a full set o f survey

reference customers, which achieved an above-average response rate, and was cited in 10%

of competitive situations by the survey respondents for all vendors.

Attractive prices and model:Talend uses a subscription model. Its average selling price is

well below the market average, and users can dow nload a free open-source version with

limited features.

Cautions

Overall profitability:Although it has significant cash reserves and committed investors,

Talend does no t expect to be profitable until sometime in 2013. This may affect its ability tomaintain necessary internal investment, should its planned trajectory not be achieved.

Technical orientation:Several clients and survey respondents describe Talend's software as

unsuitable for business users. Low scores w ere given for industry knowledge and road map

visibility.

Software flexibility and stability:Reference customers reported stability issues and a lack of

configurability with Talend's data stewardship UI; however, several gave high marks for

Talend's efforts to solve these issues .

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Tibco Software

Tibco Software (www.tibco.com) is headquartered in Palo Alto, California, U.S. Tibco's MDM version

8.3 achieved GA in March 2013. Tibco's total MDM software revenue in 2012 (estimated) was $52.8

million, of which $15.2 million was for customer data. Tibco's tota l MDM customer count in March

2013 (estimated) was 270, of which 106 were for customer data.

Strengths

Strong momentum:Tibco's revenue in this market segment grew by an estimated 25% in

2012, and its number of licenses doubled. Tibco continues to draw on its application

integration base. It is building a dedicated MDM implementation staff and a set of industry

starter templates.

Increased presence:Traditionally stronger in product data, Tibco is aggressively targeting the

customer data market segment, and see ing results. Though still relatively low, its visibility in

competitive situations has also increased.

Product strategy:Tibco has so lid multidomain and data modeling capabilities; visual MDM is a

differentiating feature for data quality reporting with a Spotfire runtime license. Tibco's in-

memory caching and use of tibbr for internal "social MDM" and governance are attractive.

Reference customers gave Tibco high scores in almost every category.

Cautions
http://www.tibco.com/http://www.talend.com/


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Emphasis on IT aspect:Reference customers and users of Gartner's inquiry service report an

IT-focused sales and implementation process, with little a ttention paid to the bus iness

ownership aspects of MDM programs. Tibco will need to engage business stakeholders

effectively to remain competitive.

Failure to market differentiators:Reference customers gave Tibco low scores for data quality

reporting, and clients seeking Gartner's advice when evaluating Tibco have not mentioned its

visual MDM. Given Tibco's capab ilities, this indicates a lack of appropriate marketing or upgrade

incentives.

Maintenance of focus:Given its rap id growth, Tibco may find it challenging to support MDM of

customer data and product data implementations with its current level of experienced

resources.

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VisionWare

VisionWare (www.visionwareplc.com) is headquartered in Glasgow, Scotland, U.K. VisionWare's

MultiVue version 3.2 achieved GA in October 2012. VisionWare's total MDM software revenue in

2012 (estimated) was $5 million, of which $4.7 million was for customer data. VisionWare's total

MDM customer count in March 2013 (estimated) was 94, all of which were for customer data.

Strengths

Excellent fit for Microsoft users:VisionWare's products are attractive to Microsoft-centric

organizations. MultiVue is based solely on Microsoft technologies, such as .NET, SQL Server

and BizTalk.

Attractive prices and models:VisionWare offers perpetual and subscription licensing and

special public sector pricing. Its average selling price is well below the market average for both

public and private sectors. Reference customers gave the company high scores for pricing

transparency.

Solid customer data capabilities:VisionWare has released a product called Auris to performMDM functions within Microsoft's Dynamics environment, and has included an integration facility

for reference data in its latest release. Reference customers gave VisionWare high scores for

most standard MDM capabilities.

Cautions

Continued flat revenue:VisionWare's revenue showed little or no revenue growth in 2011,

and this trend continued in 2012.

No multidomain vision:VisionWare has deep experience in domains such as customer and

citizen data, and MultiVue can model other domains, but the vendor has not articulated a

vision beyond its current niches.

Reference survey concerns:VisionWare achieved a low survey response rate and low scores

for its rate of technology innovation, data model flexibility and data quality facilities.

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Vendors Added and Dropped

We review and adjust our inclusion criteria for Magic Quadrants and MarketScopes as markets

change. As a result of these adjustments, the mix of vendors in any Magic Quadrant or

MarketScope may change over time. A vendor's appearance in a Magic Quadrant or MarketScope

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.

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Added

Talend Talend is an open-source vendor and its commercial MDM solution, Talend Platform for

Master Data Management, uses open-source technology, including the company's own data

integration and data quality products. In the past there has been some interest in Talend's free,

downloadable Open Studio for MDM, but this year Talend met the inclusion criteria with its

commercial offering, based on revenue attributable to MDM of customer data and a full set of

responsive implementation references.

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Dropped

SAP (NetWeaver MDM) Although this product is still included in this year's forthcoming "Magic

Quadrant for Master Data Management of Product Data Solutions," SAP's emphasis in regard to

MDM of customer data has shifted to the newer MDG-C product and the Hana-based MDG

Enterprise Edition, the latter currently scheduled, we estimate, for release in 2014. This change in

marketing and sa les strategy has resulted in a reported revenue level for NetWeaver MDM that is

lower than the minimum required for inclusion in this Magic Quadrant.

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http://www.visionwareplc.com/


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Inclusion and Exclusion Criteria

Inclusion Criteria

For inclusion in this Magic Quadrant, vendors were required to have:

Generated at least $4 million in total software revenue (licenses and maintenance) related to

MDM of customer data solutions, primarily supporting operational business processes, in the

prior calendar year

Active sales and support activities globally that is, in at least two of the following regions:

Americas, Europe, the Middle East and Africa, Asia and Australasia

Active sales, support and customers in multiple industries

We also collect and/or estimate additional data to ascertain the level of activity and stability of each

vendor in the market, though not as part of the inclusion criteria. We looked for:

At least 12 live customer references for MDM of customer data solution functionality

At least eight new customers for MDM of customer data solutions in the prior calendar year

Sufficient professional services to fulfill customer demand during the next s ix months

Enough cash to fund a year of ope rations at the current "burn rate" (companies spend their

cash reserves if a year of operations is cash-flow-negative)

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Multiple Products

Vendors may have multiple products in the MDM of customer data solutions market. Where end

users report a notable difference between them, each product is evaluated separately against

these inclusion criteria.

On this basis, the following vendors offer multiple products and are evaluated separately:

IBM: two products, both qualified and included in the analysis

Oracle: three products, two qualified and included in the analysis

SAP: two products, one qualified and included in the analysis

The following vendors offer multiple products, but some of these products did not qualify for

inclusion and are therefore not analyzed other than from the perspective of being of strategic

importance to a vendor's MDM product strategy:

Oracle: Fusion Customer Hub did not meet the inclusion criteria for revenue

SAP: NetWeaver MDM no longer meets the inclusion criteria for revenue attributable to MDM of

customer data so lutions and has therefore been dropped

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Exclusion Criteria

This Magic Quadrant excludes the following because they are e ither tangential to the main focus of

MDM programs (mastering data within the organization) or so new that they have yet to a ffect on-

premises MDM deployments:

Vendors that focus solely on analytical (downstream) MDM requirements. We use only revenue

from operationa l MDM installations for qualification, since this is where the bulk of MDM effort

goes.

Vendors rese lling another vendor's MDM of customer data solution w ithout extending its

functionality. Likewise, royalties from an OEM or resale by another vendor are not credited to

the provider of the OEM technology; original software revenue from the end-user acquisition is

credited to the reselling vendor.

Hosted and cloud-based services, marketing service providers and data providers that provide

trusted reference data external to the enterprise but do not provide an MDM of customer data

solution that specifically meets Gartner's definition.

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MDM of Customer Data Solution Product Description

This market is characterized by packaged so ftware solutions that bring together a range of

technologies and capabilities that help sustain the idea of a "single golden record" for customer

master data. This is the primary focus of this analysis. The range of functional capabilities included

in these products includes:

Data modeling capabilities The applicability of the data model to your organization is a

fundamental requirement. It must:

Model the complex relationships between the application sources inside the organization

and its products and services, as well as w ith intermediaries and other parties, with the

ability to handle complex hierarchies.


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Map to the master customer information requirements of the entire organization.

Be configurable, customizable and extensible, but also upgradable.

Support industry-specific requirements, as well as multiple hierarchical and aggregated

views associated w ith customer data structures related to consumer systems, and so on.

This is particularly important across operational and analytical MDM requirements.

Provide a base for the required workload mix and level of performance.

Be expressed using commonly accepted logical data model conventions with associated

metadata.

Manage data, business rules, sources, ownership and so on for data governed by the

MDM program using flexible, dynamic and business-consumable metadata management

capabilities.

Information quality management/semantic capabilities A good data model is of little valueunless it contains accurate, up-to-date and semantically consistent data for a customer. The

MDM of customer data solution should:

Have strong facilities, in batch and real-time modes , for profiling, cleansing, matching,

linking, identifying and semantically reconciling customer master data in different da ta

sources to create and maintain a "go lden record." These facilities may be provided by the

MDM of customer data solution vendor or by offering tight integration with products from

specialist data quality partners.

Configure business and data rules for comparing, reconciling and enforcing semantics

across data sources, matching and linking the data, and managing the merging and

unmerging of records with support for full auditability, survivability and data lineage.

Ensure that business, rules and associated metadata related to data cleansing is

sufficiently visible to satisfy compliance requirements.

Business services, integration and synchronization capabilities The MDM of customer data

solution needs to provide facilities for loading customer data in a fast, efficient and accurate

manner. There will also be a need for integration middleware, including publish and subscribe

mechanisms, to provide a communication backbone for the bidirectional flow of customer databetween the central repository and the spoke systems, be they copies or subsets of the

repository, or remote applications (coexistence style). Many organizations will also plan to use

the new customer master database as the basis for new operational (both transaction and

workflow-oriented) and analytical applications. In the service-oriented architecture (SOA)

world of enterprise architecture, service-oriented composite business applications may

consume MDM of customer data so lution bus iness se rvices through Web services' standard

interfaces.

These facilities may be provided by the MDM of customer data solution vendor or through tight

integration with products from specialist middleware partners. The MDM of customer data

solution should support, as necessary, the MDM implementation styles, which each use loading,

integration and synchronization in different ways, by be ing able to:

Leverage a range of middleware products to connect to da ta sources, including legacy data

sources, and expose industry-standard interfaces.

Support integration with different latency characteristics and styles for example, real time

and batch.Support integration with downstream bus iness intelligence and analytical requirements.

Support flexible and comprehensive business-services-based capability in order to model

data services as w ell as user interactions across applications and data stores where

master data is stored and used.

Business process management (BPM) and workflow design and management capabilities

Customer master data w ill permeate a range of business applications across systems and

geographies. Successful MDM programs require a strong, business-outcome-driven process

understanding of where and when master data is required in order to ensure the integrity of

business processes. MDM of customer data so lutions do not need to include BPMS technology,

but they do need to interoperate with third-party BPMS solutions in order for their stewardship

(enforcement) and integration (services) capabilities to be consumed in actual business

process orchestrations. A suggested range of necessary capabilities includes ones to:

Model, consider or recognize a business process model at a conceptual, logical and

physical level in order to identify a conceptual, logical and physical data model in support

of the same.Document and understand that is, diagnose the flow of master data across

business systems, applications and processes .

Design, orchestrate and manage a business-level and data-level workflow between any

MDM hub and business systems that subscribe to the necessary information

infrastructure.

Support analytics, key performance indicators and benchmarking for an "as is" version of

business processes and their outcomes, as well as w orkflows w ithin them; also, to

support a "to be" version for business process and data models.

Performance, scalability, availability and security capabilities If the MDM of customer data

solution supports operational and analytical applications and is tightly integrated w ith

established systems and new applications, serious demands are likely to be made on its

performance, scalability and availability. The MDM of customer data solution should have:

Proof points, preferably through live references, of different aspects of performance and

scalability that match your current and future requirements.


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http://www.gartner.com/technology/reprints.do?id=1-1LXAP6W&ct=131017&st=sb&mkt_tok=3RkMMJWWfF9wsRoiu6TOZKXonjHpfsX66OoqWaCwlMI%2F0 10

Appropriate availability characteristics regarding planned and unplanned downtime.

On the security and data privacy management front the ability to:

Manage the policies and rules associated with potentially complex privacy access

rights

Configure and manage different rules of visibility, providing different views for

different roles

Stewardship support and services The MDM of customer data so lution needs to support a

range of capabilities, from information policy evaluation through to the day-to-day operation

and management of MDM. Governance roles focus on policy setting, steward roles on policy

enforcement. The resulting focus of this functionality will be the role of the (business-led) data

steward and governance roles. Among the different user roles that interact with MDM, the

data stew ard and governance roles require a suitable UI whereby these services are

provided. These services will include, but not be limited to:

Design and impact assessment of information policy pertaining to business or

systemwide authority for data.

Analytics and performance measures related to a range of processes and activities taking

place within MDM, from running batch data loads to executing workflows against

benchmarks, assessing the qua lity of active master data, running business process

benchmarks, and measuring the business value provided by MDM.

Status and management tools for the stew ard and governance roles to monitor to-do

lists o f users to ensure effective action takes place across the MDM landscape.

Systemwide master/meta models to help identify which users, roles, applications and

systems are responsible for which master data , and the state o f the master data and/or

business rules that are generating exceptions in that data.

Workflow services to interrogate and provide revisions to current MDM workflows.

Business rules services to interrogate which rules are used by MDM and provide

suggested enhancements to such business rules; these are also used to determine

under which circumstances source preference is revised to give preference to the mostdependable source.

Full, business-consumable audit trail information to identify past changes to information.

A range of user interfaces on PCs, smartphones and tablets.

Technology and architecture considerations MDM of customer data solutions should be based

on up-to-date, mainstream server, PC and mobile device technologies, and be capable of

flexible and effective integration with a wide range of other application and infrastructure

platform components whether from the same vendor or not within end-user

organizations.

An MDM of customer data solution should be capable of:

Flexible configuration into a range of implementation styles in terms of instantiation, latency

and use of customer master data to enable it to sa tisfy different use case scenarios, such

as the consolidation, registry, coexistence and centralized scenarios.

Architecturally supporting global rollouts and localized international installations.

Supporting both on-premises and cloud deployment styles, including SaaS.Supporting integration with big data sources, such as social networks, and pe rforming

entity resolution within those sources, whether relational or nonrelational, and whether

data is structured or unstructured.

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Evaluation Criteria

Ability to Execute

Gartner analysts evaluate technology providers on the quality and e fficacy of the processes,

systems, methods or procedures that enable IT providers' performance to be competitive, efficient

and effective, and to positively impact revenue, retention and reputation. Ultimately, technology

providers are judged on their ability and success in capitalizing on their vision.

Product or Service:Software products offered by the vendor that compete in/serve the MDM ofcustomer data solutions market segment. This includes product capabilities, quality, feature sets,

skills and so on, whether o ffered natively or through OEM agreements and partnerships as defined

in the market definition and detailed in the subcriteria.

Vendors are measured on the ability of their products to support the following MDM of customer

data solution subcriteria:

Data modeling capabilities

Information quality and semantic capabilities

Business services, integration and synchronization

Workflow and BPM capabilities

Performance, scalability, security and availability capabilities

Stewardship support and services

Technology and architectural considerations


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Overall Viability:Viability includes an assessment of the MDM of customer data solution vendor's

financial health, the financial and practical success of the business unit or organization in

generating business results in the MDM of customer data solutions market segment on a global

basis, and the likelihood that the organization or individual business unit will continue to invest in

development of the product, offer the product and advance the state of the art within the

organization's product portfolio.

Sales Execution:A vendor's capabilities in all MDM of customer data solutions-related presales

activities on a global basis, 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 and Track Record:Ability to respond, change direction, be flexible and

achieve competitive success as opportunities develop, competitors act, customers' needs evolve

and market dynamics change within the MDM of customer data solutions market segment. Thiscriterion also considers the vendor's history of responsiveness.

Marketing Execution:The clarity, quality, creativity and efficacy of programs designed to de liver the

vendor's message on a globa l basis, in order to influence the MDM of customer data solutions

market segment, promote the vendor's brand and business, increase awareness of its products,

and e stablish a positive identification with its 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.

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

successful on a g lobal basis w ith the products evaluated. This includes implementation and support,

and the way customers receive technical and account support. It also includes measures of clients'

success in implementing MDM for customer data solutions: customer references and TCO.

With the increasing hype about multidomain MDM, we also look for demonstrated proof via proof

of concepts, customer evaluations and live implementations o f multidomain/multiprovince

capability.

Operations:The provider's ability 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. This criterion

was not explicitly rated, but was rolled into the Overall Viability, Sales Execution/Pricing and

Marketing Execution criteria.

Table 1.Ability to Execute Evaluation

Criteria

Criteria Weight

Product or Service High

Overall Viability High

Sales Execution/Pricing High

Market Responsiveness/Record High

Marketing Execution High

Customer Experience High

Operations Low


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Completeness of Vision

Gartner analysts evaluate technology providers on their ability to convincingly articulate logical

statements about current and future market direction, innovation, customer needs and competitive

forces, and how well they map to Gartner's position. Ultimately, technology providers are rated on

their understanding of how market forces can be exploited to create opportunity for the provider.

Market Understanding:A vendor's ability to understand buyers' needs and translate these needs

into products and services. Vendors that show the highest degree of vision listen and understand

buyers' wants and needs, and can shape or enhance those wants w ith their added vision. Vendors

should demonstrate a strategic understanding of MDM for customer data solution opportunities (for

example, new application functionality or customer segments) and ongoing vendor market dynamics

(for example, consolidation trends) on a global basis, and translate that understanding into

products and services. Additionally, we consider a vendor's understanding of the wider implications

of, and the position of MDM in relation to, other kinds of master data within an organization's

multidomain, multiuse case and multi-implementation style program; an understanding of the

relationship to enterprise information architecture and EIM initiatives is also valuable for customers

taking a strategic view.

Marketing Strategy:A clear, differentiated set of MDM of customer data solution messages

consistently communicated throughout the organization and externalized globally through a

website, advertising, customer programs and positioning statements. Intersection with multidomain


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Geographic Strategy Medium


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Quadrant Descriptions

Leaders

Vendors in the Leaders quadrant have strong results and strong delivery capabilities, and will

continue to have them. They typically possess a large, satisfied customer base (relative to the size

of the market) and enjoy high visibility in the market. Their size and financial strength enable them

to remain viable in a challenging economy. Leaders have mature offerings and track records of

successful deployments, even in the most challenging environments, across all geographies and in

many industries. Leaders have the strategic vision to address evolving client requirements;

however, they are not always the best choice.

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Challengers

Challengers demonstrate a clear understanding of today's MDM of customer data solutions market

segment, but they have e ither not demonstrated a clear understanding o f the market's direction or

are not we ll-positioned to capitalize on emerging trends. They often have a strong market presence

in other application areas.

There are no Challengers in 2013's Magic Quadrant. The MDM of customer data solutions market

segment is increasingly being impacted by the gradual formation of requirements centered on

multidomain MDM in other words, single solutions that can be used for any number of data

domains. This influence was very slight five years ago. Every year it has increased, however, and as

a result the positions of vendors in this year's Magic Quadrant have been "elongated" from lowerleft to upper right in Figure 1. Assuming the multidomain MDM market emerges, the MDM of

customer data solutions market segment may no longer need to meet those multidomain

requirements, so the requirements of future issues of this Magic Quadrant may focus more on the

single domain, in which case the positions of the vendors in Figure 1 are likely to spread out. The

effect of the current level of ancillary interest in multidomain capabilities by users of MDM of

customer data solutions can be seen in this year's Magic Quadrant reference survey, where 43% of

respondents voiced interest in noncustomer domains, but only 29% actually formally evaluated

those capabilities prior to purchase.

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Visionaries

Visionaries display healthy innovation and a strong potential to influence the direction of the MDM of

customer data solutions market segment, but they are limited in execution or demonstrated track

records. Typically, their products and market presence are not yet complete or es tablished enough

to merit Leader status. There are no Visionaries in this year's Magic Quadrant.

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Niche Players

Niche Players do well in specific segments of the MDM of customer data solutions market segment,

or have a limited ability to be innovative or outperform other vendors in this segment. They may be

focused on a specific functionality, domain or industry, or have gaps in relation to broader

functionality requirements. Niche Players may have limited implementation and support services, or

they may not have achieved the scale necessary to solidify their market positions.

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Context

This Magic Quadrant offers insight into the part of the packaged MDM solution market that focuses

on how organizations master and share a "single version" of customer data w ith multiple views of it

across their organizations achieving a single version of master data is a key initiative for manyorganizations. In this Magic Quadrant "customer data" is defined as including consumers, business

customers, channel/trading partners, prospective customers, citizens, constituents, people of

interest, healthcare profess ionals, patients and counterparties; it excludes other parties, such as

human resources and suppliers. This analysis pos itions MDM of customer data solution vendors

(and their offerings) on the basis of their Completeness of Vision relative to the market segment,

and their Ability to Execute on that vision.

Use this Magic Quadrant to understand the MDM of customer data solutions market segment, and

how Gartner rates the vendors (and their offerings) in this segment. Study this research to

evaluate vendors by a set o f objective criteria that you can adapt to your particular situation.

Gartner advises organizations aga inst simply selecting vendors in the Leaders quadrant. All

selections should be buyer-specific, so vendors from the Challengers, Niche Players and Visionaries

quadrants might be better matches for your requirements. See "How Gartner Evaluates Vendors

and Markets in Magic Quadrants and MarketScopes."

Although important, selecting an MDM for customer data solution is only part of the MDM challenge.


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To succeed, you should put together a balanced MDM program that creates a shared vision and

strategy, addresses governance and organizational issues, uses appropriate technology and

architecture, and creates the necessary processes and metrics for your customer data system (see

"The Seven Building Blocks of MDM: A Framework for Success" and "The Five Vectors of Complexity

That Define Your MDM Strategy").

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Market Overview

The Need for a Single View of the Customer

Business drivers for creating a single view of the customer include:

Compliance and risk management drivers, such as "know your customer," anti-money-

laundering and counterparty risk management in the banking sector, and Sunshine Act

compliance in the life sciences sector. Associated initiatives tend to have concrete benefits and

they are mandatory.

Cost optimization and efficiency drivers. Very often these drivers a re associated w ith business

transformation initiatives and end-to-end business process improvement programs. These

have tangible benefits and are a good fit for organizations' needs during an economic

downturn.

Revenue and profitability growth drivers. Examples are initiatives to improve cross-selling,

upselling and retention. CEOs, chief marketing officers and CIOs are placing increased

emphasis on improving the customer experience through an accurate and complete

understanding of customers' interactions with their enterprises. These drivers can be more

difficult to measure, but are a major focus when the economy is going well.

However, most large enterprises have heterogeneous application and information management

portfolios, with fragments of often inaccurate, incomplete and inconsistent data residing in variousapplication silos. No single system contains this single view of the customer or is designed to

manage the complete life cycle of customer master data.

The ability to create, maintain and draw on a single, trusted, shareable version of customer master

data is increasingly seen as an essential requirement in commercial and noncommercial

organizations to support business processes and business decision making. When creating and

managing customer master data, many organizations and vendors originally thought that CRM, ERP

or industry application systems would solve the problem of inconsistent master data spread across

multiple systems; however, CRM, ERP and industry systems were not designed for that task, and

often there a re multiple CRM or ERP systems in an enterprise. Many organizations have now

invested in creating a new central system to master their customer data, with the majority (an

estimated 80%) of organizations buying packaged MDM of customer data solutions, as opposed to

building the capability themselves.

Organizations in different industries have different business models, and therefore their MDM

efforts vary (see "The Five Vectors of Complexity That Define Your MDM Strategy"). Some

organizations have a customer base of millions of consumers, such as high-volume B2C

organizations. Others have a base of thousands or tens of thousands of customers, such as lower-

volume, but more complex, B2B organizations. This has implications for the MDM implementation

style (see "The Important Characteristics of the MDM Implementation Style").

In a high-volume B2C organization, customer data is typically authored in a distributed fashion in

existing applications. In this case, the MDM "journey" may start with either registry-style indexing in

the central hub or a physical consolidation into the central hub, potentially followed by publishing

from the hub to harmonize the different application systems in a coexistence style. Some

organizations reach their intended goa l by coupling hub-and-spoke systems more tightly with

transactional access to the hub where central authoring takes place. The B2B requirement also

often leads to central authoring, but on the basis of a collaborative workflow.

Our Magic Quadrant reference survey (see Note 2) found that 29% of respondents followed the

centralized approach in 2013, up from 20% in 2012. The coexistence style, where the authority

model is shared between the MDM hub and its source operational systems, was adopted by 13% of

respondents, up from 12% in 2012. The conso lidated style of MDM hub was reported by 40% of the

respondents in 2013, up from 36% in 2012. Their customer master data store contained a

reconciled copy of the master data from other authoritative sources. The percentage of those

following the registry approach with their customer master data store consisting only of an index

to the master data in other authoritative sources fell to 4%, from 9% in 2012. Hybrid approaches

were reported by 13% of respondents, down from 21% in 2012.

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The Market Is Maturing Steadily but Still Has Some Way to Go

Momentum has been steadily building in this market during the past 10 years, during which time

MDM vendors have sold over 2,500 copies of their MDM of customer data solutions. Moreover, MDM

vendors that traditionally sold lead products in other disciplines (such as data quality or data

integration) are now widely reporting sales driven primarily by MDM, with "pull-through" of other

products in the same deals. In add ition, the continued strong growth o f the CRM market (see

"Forecast: Enterprise Software Markets, Worldwide, 2012-2017, 2Q13 Update") bodes w ell for the

future of MDM of customer data, as MDM commonly lags CRM implementat ions by a few years

weakly managed CRM data quality can result in operational difficulties (such as salespeople


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redundantly calling the same prospective customer) that ultimately require an MDM implementation

to solve.

However, our survey for this Magic Quadrant found that the proportion of organizations that

described their use of enterprisewide MDM of customer data as "well established" was down by 5%

from 2012; the proportion that said they we re "working toward" enterprisewide MDM of customer

data he ld steady; and the proportion that described themselves as "having good MDM capabilities

in some areas" grew by 9%.

Despite its momentum, the market is still characterized by much immaturity. During interactions with

users of Gartner's client enquiry service and one-on-one meetings with clients at Gartner events,

approximately 40% of organizations have said they are just starting their MDM programs.

Additionally, vendors of MDM of customer data solutions are still expanding their products in

different directions, and new players continue to enter the market.

In "Hype Cycle for Enterprise Information Management, 2013," we place MDM of customer data in

the Trough of Disillusionment. This is actually a positive sign, as it shows that MDM of customer data

is well past the initial hype and early adopter implementations, and is steadily gaining maturity,

although it is not yet fully mature.

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Vendors Are Investing in Data Stewardship and Governance Technology

In terms of new MDM capabilities, vendors have been placing particular emphasis on adding or

improving data stewardship and governance facilities, including data profiling, workflow, data

visualization and manipulation, dashboards and reporting. In 2012, they introduced better UIs and

workflows for business users, making greater use of bus iness process management technology

and MDM applets, which allow existing applications to use MDM-hub-based data.

Across every aspect of MDM product, customer and multidomain stewardship tools are turninginto solutions called information stewardship applications. This is an exciting trend as it shows the

relevance of master data to business users in terms of business value and impact (see "The

Emergence of Information Stewardship Applications for Master Data"). Organizations are applying

stewardship applications more often to business data attributes beyond those in master data

domains, to support data stewards in their data governance activities across varied data

management initiatives. Although demand is still emerging, it is clear that early-adopter

organizations recognize the value of these capabilities.

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The Nexus of Forces Creates Both Opportunities and Risks

Gartner calls the growing convergence of cloud, social networking, mobility and information trends

the "Nexus of Forces" (see "The Nexus of Forces: Social, Mobile, Cloud and Information").

Organizations in the customer data MDM market are keeping a close eye on opportunities in these

areas. Most organizations recognize there will be both a cultural and a technological shift, but are

struggling to understand the impact this will have on their information environments and therequired strategic responses (see "The Impact of Social and Other 'Big Data' on Master Data

Management").

Organizations recognize that MDM is critical for accurate sentiment analysis in social networks, but it

may take longer to implement than they are willing to wait. They also understand that it is more

damaging to send unsuitable or redundant retail offers to a customer's smartphone than it is to

send the same offers via postal mail here, again, the role of MDM comes to the fore.

As expected, organizations have shown a high level of interest in social media and mobility as they

relate to MDM of customer data. But they have shown a low level of interest in the cloud in

connection with MDM in general. There are several reasons for this (see "Hype Cycle for Information

Infrastructure, 2013"). Some organizations are using cloud MDM hub services in limited cases, such

as rapid proofs of concept; however, the overwhelming preference is currently for on-premises

implementations.

Some vendors recognize the need to move from a "single view o f customer truth" to a "single view

of customer trust" and are establishing relevant product strategies to reflect this. But user

organizations typically do not know how to react. As such, we be lieve there is a high risk that some

user organizations will follow a tactical, technological (vendor-led) response to the impact of the

Nexus of Forces, rather than a strategic one that would be of greater benefit to their business.

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Market Growth Continues and Several Portfolios Remain Complex

Gartner estimates that total software revenue for packaged MDM solutions was $1.6 billion in 2012,

an increase of 7.8% from 2011, as compared with a 4.7% rise for the overall enterprise software

market (see "Forecast: Enterprise Software Markets, Worldwide, 2012-2017, 2Q13 Update").

Within these overall figures we e stimate that the MDM of customer data solutions market segment

was worth $527 million in 2012, an increase of 5.4% from 2011. In "Forecast: Master Data

Management, Worldwide, 2010-2015," we projected a five-year compound annual growth rate o f

nearly 20% for both the overall MDM software market and the MDM of customer data software

market segment through 2015.


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We estimate that IBM is the market share leader in the MDM of customer data solutions market

segment (based on sales of InfoSphere MDM SE and AE), with estimated total software revenue o f

$203 million in 2012. Oracle is in second place (based on sales of its Oracle CDH, Oracle Fusion

Customer Hub and Siebel UCM products) with estimated revenue of $114 million in 2012.

Informatica is in third place w ith estimated revenue of $70 million in 2012. SAP is in fourth place

with estimated revenue of $30 million (based on sales o f NetWeaver MDM and stand-alone hub

deployments of MDG-C) in 2012. Tibco is in fifth place w ith estimated revenue of $16 million in 2012.

Together, we estimate that these five market share leaders account for over 80% of the MDM of

customer data solutions market segment.

Unlike earlier years, the pas t year has not been characterized by acquisitions, except for

Informatica's acquisition of Data Scout (and subsequently, product information management vendor

Heiler and BPMS vendor Active Endpoints). But we continue to see the after-effects of acquisitions:

the larger vendors continue to promote and execute convergence road maps to integrate formerlydisparate product and technology mixes.

Investment in MDM of customer data solutions continues to occur across all industries, including the

government sector. Service industries (such as financial services and healthcare) and governments

tend to focus on the customer data domain (except for some sectors of financial services that deal

heavily with securities), whereas product-oriented industries tend to be interested in a wide set of

data domains (such as product, supplier and customer). There is global interest and investment in

MDM of customer data solutions, mainly by large enterprises.

The MDM portfolios of the megavendors (IBM, Oracle and SAP) remain complex. This is largely a

result of them trying to meet the initial multidomain demands of the MDM market. IBM continues to

focus strongly on a convergence road map for its multiple products, and has begun substantial

development relating to its vision for MDM linked with big data sources such as social networks.

Oracle is also converging onto common middleware and MDM technology infrastructure, though

sales execution and consequently market uptake of its Fusion MDM platform have been slow.

SAP now has two products in this market segment NetWeaver MDM and MDG-C with a third,

MDG Enterprise Edition, planned for 2014 for consolidation-style MDM, replacing the planned

development of the Master Data Services (MDS) product. The capabilities originally planned for

stand-alone MDS are being integrated with MDG capabilities and will be delivered as part of MDG

Enterprise Edition.

The smaller vendors have continued to make progress in diverse ways:

Informatica has completed its acquisition of Data Scout for MDM of customer data stored in

salesforce.com, and has produced versions of this software (now known as Informatica Cloud

MDM) incorporating functionality from its on-premises MDM product. Additionally, in 2013,

Informatica acquired Heiler Software, a vendor of MDM of product data solutions, to

strengthen its multidomain credentials.

Tibco Software continues steadily to increase its emphasis on MDM and is becoming more of a

force in the MDM of customer data market segment.

SAS is taking concrete steps to integrate the former DataFlux MDM solution with its broader

suite of SAS data management products.VisionWare continues to provide a distinct Microsoft-based value proposition but remains

focused on a limited set of industries, such as healthcare and the public sector.

Orchestra Networks, which appeared in the Magic Quadrant for MDM of customer data

solutions for the first time in 2012, is growing strongly in some targeted scenarios.

Talend appears in this Magic Quadrant for the first time this year, after fully meet ing all the

inclusion criteria for revenue and implementation references.

Other vendors, such as Ataccama, Information Builders, Kalido, Software AG and Teradata, are also

active in this market segment, but their presence (though increasing in some cases) is not large

enough in one or more respects for them to be included in this Magic Quadrant. Microsoft has not

yet had a major impact on the MDM market with its SQL Server Master Data Services (MDS)

technology, other than supporting end users' plans to "build" their own MDM solutions or being

incorporated into third-party channel partners' solutions (for example, those of Profisee). While

Microsoft's MDS toolset provides several capabilities expected of vendors in this Magic Quadrant, it

does not provide the degree of out-of-the-box integration between those capabilities that is typical

of an MDM software so lution.

Vendors that previously focused on managing product data, such as Riversand and Stibo Systems,

started to adopt a more multidomain position in 2012 and to become more relevant to the MDM of

customer data solutions market segment. Several of these vendors have developed an MDM of

customer data implementation at one or more of their existing clients, capitalizing on established

relationships. However, the revenue attributable to these efforts has yet to meet the inclusion

criteria for this Magic Quadrant.

There are many other vendors, some small, innovating in and around the field of MDM of customer

data. Semarchy is a small French vendor focused on helping clients with an "evolutionary" approach

to scaling MDM. Collibra is another small vendor, one that focuses more on the information

stewardship side of MDM. Pitney Bowes has built an MDM solution based on the graph database

paradigm and emphasizing geospatial capabilities. Dell Boomi has introduced a solely cloud-based

platform. These and other vendors show that this market segment is vibrant and constantly

evolving. We expect to see more acquisitions and new entrants in the next few years.


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Although the overall view of this year's Magic Quadrant appea rs similar to that o f a mature software

market, the complex nature of the MDM discipline has led to a situation in which there are still

vendors entering the Magic Quadrant for the first time, and others potentially approaching entry. In

addition, many vendors are now branching out to manage additional master data domains.

Additionally, existing clients and prospective customers have become more educated about the

depth and complexity of the expertise and management required by successful MDM

implementations, and would seem more likely to rely on a market leader. However, there has also

been a noticeable increase in interest during Gartner's interactions with clients (particularly at our

MDM conferences) in vendors that can provide specific capabilities at more modest prices. As the

overall market continues to grow, there are likely to b

Documents

Magic Quadrant for Master Data Management of Customer Data Solutions - 2013