Expert analysis is great, but in many respects a crowdsourced opinion has more validity. For example, a professional critic will provide a deep analysis of a movie–the directing, the acting, the dialogue, the cinematography. In the end, though, crowdsourced word-of-mouth is a much better measure of whether a movie is worth seeing or not. The same may be true for market research and industry analysis.
Gartner is the king of the market research hill and companies lust after being placed prominently on Gartner’s Magic Quadrant. However, a new breed of crowdsourced market research has come along to challenge–and potentially threaten–the Magic Quadrant status quo.
I wrote a blog post about the changes in market research and industry analysis:
Industry analysis and market research is an important part of doing business. Companies rely on independent analysis of market segments and potential vendors to make decisions that impact business and the bottom line. Firms like Gartner and Forrester are heavyweights in the industry, but a new breed of industry analysis has sprung up to challenge the status quo with crowdsourced market research. Should the old guard be worried?
The kingmakers explained
There are a couple problems with the traditional approach to market research. On the one hand, purchasing the insights and analysis of these firms is expensive, and many small and midsize companies simply can’t afford to access the information. Second, there’s a perception that the system operates on a “pay-to-play” quid pro quo that biases the analysis and makes it a somewhat self-fulfilling prophecy.
Richard Stiennon, an independent analyst who formerly worked for Gartner, wrote a book dedicated to helping organizations understand and succeed in the Magic Quadrant game. In Up and to the Right, Stiennon writes, “There is magic in the Gartner Magic Quadrant. Despite the heaps of scorn expressed by vendors that don’t make it into the Leaders Quadrant, there is no denying the positive benefits that derive from reaching the position farthest UP and to the RIGHT.”
Gartner’s Magic Quadrants are a sort of Holy Grail for companies. The company that tops the Magic Quadrant at the upper right is essentially crowned king of its industry, but just being somewhere on the grid—even at the bottom left—provides significant exposure and is enough to boost the image of a company. In other words, the incentive is to do what it takes to place on Gartner’s Magic Quadrant.
According to Stiennon, a favorable position on the Magic Quadrant yields a variety of benefits. Companies that “win” at the Magic Quadrant game get increased deal participation, increased valuation, better relationships with press and media, and more merger and acquisition activity. In other words, life is good if you place well on the Magic Quadrant.
A brave new faster-paced world
Market analysis by firms like Gartner and Forrester takes a long time to research and produce, and most companies simply can’t afford to play Gartner’s game—whether it’s as the subject of the market research or the customer buying it. They’re not the only source of information, though. With the advent of the Internet and mobile devices, we all have somewhat ubiquitous access to information almost instantaneously. Bloggers, online tech press, independent analysts, and social networks such as Facebook and LinkedIn provide an endless source of valuable information.
New companies like Chaordix and Whale Path lie somewhere in the middle. They deliver credible, curated insight with greater speed than the big market analyst firms. This new breed offers similar research and analysis as Gartner and Forrester, at a fraction of the cost. They can do this because the data and research are crowdsourced.
“Whale Path was born out of a need for proprietary and reliable market data and analysis research that can be delivered at a significantly lower price and much faster than Gartner’s or Forrester’s typical time frame,” explains Artem Gassan, CEO of Whale Path. “We felt the need for a new way for companies to acquire reliable market data and analyses, and we are creating this way by utilizing the crowdsourcing model.”
Whale Path is a venture-backed startup based in San Francisco with a simple mission. It wants to disrupt the traditional research space by utilizing the crowdsourced model, bringing together thousands of analysts who are eager to utilize their knowledge and skills to earn extra income on the side and produce unbiased, reliable market data and analysis.
Check out the full story on TechBeacon: Crowdsourcing market research could end the Magic Quadrant quest.
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