As Customer Data Integration technology continues to gain traction with enterprises, the competition for CDI market
share is growing fierce. But according to Gartner, there is currently no clear leader in providing CDI software and probably won't be until 2007.
In its first Magic Quadrant for CDI Hubs, the Stamford, Conn.-based research firm identifies Siebel Systems Inc. as the sole challenger and SeeBeyond Technology Corp., DWL Inc., Initiate Systems Inc. and Siperian Inc. as visionaries. Gartner breaks down technology vendors into four categories -- leaders, challengers, visionaries and niche players -- based on their presence in the market.
"With the larger players -- SAP, Oracle and Siebel -- they have a long way to go in terms of demonstrating large-scale reference sites," said John Radcliffe, a vice president and research director with Gartner. "With the specialists -- DWL, Initiate and Siperian -- in terms of the size of company they serve, their ability to get resources out there and build market share, they're at a disadvantage."
Oracle Corp., SAP AG, Dendrite International and VisionWare plc were listed as niche players in the report.
Linking and synchronizing customer information from a myriad of disparate systems has proven to be one of the biggest roadblocks to achieving a "unified view of the customer" and gaining full value from CRM. Increasingly, organizations are turning to CDI hubs for help. Relatively immature, the market offers competitive advantages to companies that adopt the technology now, but also presents risks like immature products and vendor viability with the smaller providers, Gartner warns. By 2008, the research firm predicts that IBM, Microsoft, Oracle, SAP and Siebel Systems will command more than 50% of the CDI hub software license revenue.
When it comes to CDI technology, there are a few areas of functionality that are absolutely key, Radcliffe said. An application needs to be able to recognize fragments of information and bring it together on the fly, he said. Additionally, information quality and data that is accurate, up to date and consistent must be a part of a CDI initiative. Chicago-based Initiate Systems and San Mateo, Calif.-based Siperian have built-in scoring and matching algorithm capabilities, while others depend on partnerships with data quality vendors.
"Another angle that is absolutely key is the data model," Radcliffe said. "Typically, the first thing people look at is, 'Is the data model rich enough to model the customers I have and the relationships I have between those customers?'"
CDI vendors' vertical market experience becomes key in these situations. For example, the insurance and pharmaceutical industries group and treat customers differently. Insurance firms want to know the relationships between families or companies and the policies they hold, while pharmaceutical companies need to track the relationships between hospitals, doctors and suppliers.
Initiate and Monrovia, Calif.-based SeeBeyond have built up some health care references, while Bedminster, N.J.-based Dendrite International and Siperian have primarily pharmaceutical customers. Siebel, Radcliffe said, has work to do in identifying reference customers.
"They were obviously gearing up for [CDI] strongly," he said. "We haven't yet really seen the follow-through. That's likely to start the second half of the year in Q2 or Q3, with meaty references."
While Siebel does have experience building a customer data view in multiple industries like financial services, telecommunications and the public sector, it needs to work on being application neutral, Radcliffe said. Of the large, enterprise application vendors, Siebel is the most proactive in seeking opportunities outside its existing customer base, Radcliffe said. Oracle is mostly involved in Oracle shops with its Customer Data Hub and SAP has a broader vision with its Master Data Management product, which encompasses not just customer data, but employee and product data as well.