How to Become a Gartner MQ “Visionary”

Lets face it, many leaders at product-led growth (“PLG”) companies hate Gartner. The idea of investing precious time and effort in pitching Gartner for placement on their “Magic Quadrant” product surveys just seems stuffy and old fashioned...and it is! But if you’re serious about competing in the enterprise, it’s entirely necessary. Why? (And don’t say it’s because enterprises are “stuffy and old-fashioned!” Be nice!)

Most PLG companies think about their ‘products’ very differently than enterprise customers (“ECs”) do. PLG companies think about easy-to-use, easy-to-buy, low-friction, self-service products that have “cool features” which meet a well understood need and fit an established category. Oftentimes, earlier-stage PLG companies are more focused on SMBs, with simpler requirements and smaller budgets. 

Enterprise customers don’t really think about “products” at all. They think about people, processes, and organizational problems. They want “solutions” to their operational challenges such as “managing sales more efficiently”, or “speeding up time to market in manufacturing”, or providing a “better customer experience” (I know, it’s always a mouthful with EC’s!) EC’s have more complex operations and (here’s the rub!) they have more money to invest in innovative technology to ease the pain. 

And it’s precisely because of these differing perspectives on “products” vs. “solutions” that EC’s look to analysts like Gartner to speak their language, and help them sort through the blizzard of products out there that can potentially help them drive their business; to describe and stack rank the strengths and weaknesses of the COMPANIES behind the product. This last point is the MOST IMPORTANT thing for PLG companies to understand: Gartner is not analyzing your PRODUCT, per se. They’re analyzing and ranking your BUSINESS.

“Why is this distinction important”, the PLG leader asks? “Doesn’t the customer just care about the product? Can’t they just read the G2 reviews?” Well, no, actually. The product is important of course. But the strength of the business behind it is just as important because enterprises don’t just want a product to fill some quick technology gap. They are wary of point solutions and want to invest in a long-term partner to help solve a bigger business problem, not just a product vendor. They are looking for a solution to their pain-point today, and for a partner that exhibits the vision and capabilities to solve tomorrow's unknown problems as well. EC’s look to experts like Gartner analysts to do a lot of the upfront investigation and analysis of the companies vying for their attention and business before they plunk down the big bucks.

All of this can feel a little overwhelming and boring to the passionate technology entrepreneur. But if you want to win bigger deals, and rack up higher margins by charging higher prices to bigger EC’s, you just have to suspend your disbelief and Dance the Gartner Waltz. 1-2-3! 1-2-3! lets go! (But never fear, in today’s"Double Funnel" world where SaaS companies have both SMB and Enterprise funnels, you don’t have to worry that going after larger customers will hurt your ability to serve the SMB).

In light of all the above, let’s talk about what the heck the Gartner MQ means anyway. “Magic Quadrants” are product category “maps” of where companies fit in the landscape of competitors vying for the business of ECs, depicted across two rows of two squares (“quadrants”) stacked on top of each other (See below). The X-axis of the MQ refers to “completeness of vision”. In other words, does the company possess the ability to articulate and deliver an industry-leading vision for a product category, which could eventually define the space. PLG companies generally “get” the X-axis thing because it’s all about technology vision, but they fail to understand the all important Y-axis: the “ability to execute”. In other words, does the company have strong customer traction and a track record with actual enterprise customers, with the scale and resource to meet the needs of more demanding ECs.

The earlier but viable entrants in a space are deemed to be “niche” players (bottom left square), rapidly emerging movers and shakers are “VISIONARIES” (bottom right) and the LEADERS of the space, are well, LEADERS (top right square). Finally, companies that have reached critical mass, but no longer have the vision to lead a category, are relegated to “Challenger” status (upper left), sometimes referred to as the quadrant where products “go to die”.

So how do you get onto the MQ and then start moving up and to the right? Here are 5 rules of thumb to make the process fun and rewarding. 

Rule 1: don’t fool yourself into thinking you’ll just jump the line and land in the visionary or leader quadrant at the first try. EVERYONE ALWAYS starts in the “Niche” quadrant. You may be the most brilliant product visionary in the world, but you will start in “Niche”, so just get over it. But that'sthats OK. It will still help you build your enterprise brand and street cred.

Rule 2: meet with Gartner face to face (once you're vaccinated), and make sure your CEO and key executives meet them as well. Remember, it’s not just about the product. It’s about the business. Who’s running sales, support and marketing? Do they have the experience and team to support larger customers? You need to show the whole company to them. When I was CMO at Freshworks, Gartner visited our offices in Chennai for the first time, and that made a huge difference. Seeing the size and depth of our operations there was critical in terms of climbing up the “ability to execute” Y-axis.

Rule 3: Have great enterprise customers already. This is the catch-22: In order to get onto the MQ and then climb up, you have to already have good product traction with larger customers, without being on the MQ. Test your mettle! Go get those critical reference customers. Each MQ category has different requirements about the number and size of Customer you need to qualify, so make sure you know in advance what they are and then go get the customers! Try to have at least 3-5 referenceable enterprise customers with complex use cases.

Oh, and a hot, quick tip: be SURE to brief your customers before they talk to Gartner so they have an understanding of what kinds of questions the analyst will ask. 

Rule 4: Tell a truly visionary product story. At Freshworks, we were in the niche category for one product (Freshdesk) in one category for several years (the Customer Engagement MQ, see below). We needed to move up and to the right to start winning more mid-market enterprise business. Also we had newer products vying to get into other MQs. We did this by breaking away from the pack with our vision for re-imagining CRM as a “customer-for-life” virtuous cycle of customer success across support, sales, and marketing.

Here’s how we developed this vision: CRM has been defined for over 25 years by leaders like Salesforce and Siebel as a “sales funnel” starting with a sales force automation application designed by and for sales people. It is primarily a management tool for managers to know what their salespeople are doing, rather than empowering reps to provide a great service, with customer experience and support almost as an afterthought.

Freshworks started as a customer support platform (“customer engagement”) and expanded into other areas like sales force automation and lead management. From the outset, the DNA of Freshworks was focused on creating great customer experiences through better support. When the company had the opportunity to acquire a Customer Success company called Natero (a Gainsight competitor), we saw it as a great way to further differentiate and highlight our visionary approach to the CRM space. “Customer Success” is an emerging category of software primarily designed to help subscription-based businesses like SaaS companies ensure that customers are happy with their solutions and either renew and/or buy more of their product rather than cancel. 

Customer Success products monitor all kinds of data from product usage to payments, and support issues which, together, are predictive of overall customer satisfaction and loyalty and empower customer success teams to nurture a healthy customer base. The Natero acquisition inspired us to start calling our platform “Customer-for-life” software which gives you everything you need to know and do to retain and expand customer relationships.

It allowed us to essentially flip the CRM funnel upside down, and put the customer experience at the center of our vision, rather than the sales pipeline in traditional CRM platforms like Salesforce. Gartner acknowledged our unique approach and told us we were the first CRM platform to incorporate Customer Success as a core functionality and data framework for CRM. That was a good pitch!

This visionary story, along with all the great work our sales and support teams had done with our larger customers allowed us to move UP and to the right, to become the ONLY Visionary in the 2020 Customer Engagement MQ. This was huge for the company because it signaled the arrival of Freshworks as an Enterprise vendor . In addition, this effort laid the groundwork for Freshworks to add 3 more products (count ‘em!) to MQ’s for Lead management, SFA, and ITSM.

Rule 5: market the heck out of your MQ. Customers love them, investors love them, and your employees will feel a real sense of pride in what they have accomplished to earn the MQ moniker. It’s all part of the never ending process of building your brand and can also be an excellent internal forcing function to nail down your product roadmap and hone your message, not to mention drive shareholder value. 

In the time it took Freshworks to go from being a “niche” player to a “visionary” company with not just 1 but 4 MQs under its belt, the company’s valuation grew from $750 million to $3.5 billion. And that’s no coincidence!

Good luck with your Gartner Journey: it can actually be a lot of fun.