Gartner is committing to focus on seven key vertical markets including three in Financial Services (Banking, Insurance, and Investment Services) and Media, Retail, Manufacturing, and Energy & Utilities. Included in its services for these verticals will be:
- In-depth reports specific to the vertical
- Research notes
- Access to analysts specific to the vertical
- Access to client services
- Event participation
- Client-shaped research agendas (new to Gartner)
No new analysts will be hired, and the sales force will not be aligned to sell specific verticals.
One of the key trends we identified last year in the IT research segment was an increasing orientation toward providing IT information unique to certain industries. IT research by industry has been the Holy Grail for many research firms over the years. A lot of early IT research firms did not have the size or the deep pockets to fund industry-specific IT research, and individual industries did not represent as much buying power as horizontal technology coverage represented. Other IT research firms including AMR, Tower Group, Forrester, Jupiter, IDC, and META have provided strong offerings designed for specific vertical markets, while Gartner has sold horizontal products into specific verticals. Gartner is not leading this charge but taking a much-needed step in the right direction.
G2 Retired: Gartner plans to retire its G2 product line over time, and any related analysts have been transferred into the new vertical group. Gartner will honor all current G2 contracts until the end of August, and has halted all new sales of G2. The only vertical that will be retired is travel, and the automotive segment has been moved into manufacturing. Government and education are currently being served by Gartner’s Core Research offering, and the firm is reviewing its approach for 2006.
Packaging and Pricing: Gartner plans to offer these verticals in combination with its core research product offering. The core research offerings will provide the horizontal technology coverage, while the vertical services will dig down as appropriate for specific vertical industry issues. Access to core research will always be included in the packaged offering, and incremental pricing will apply to the vertical segments. Gartner would not disclose pricing and packaging options, but we believe that they will be in a $15,000 minimum to $25,000/$35,000 maximum range per industry segment, with discounts for additional segments. This would be in a normal range for an add-on product in this market area, and would be in line with pricing for its Dataquest Cluster products.
Client-Shaped Agendas: The move to client-shaped agendas will be increasingly visible across Gartner product offerings. Client-driven research agendas have been a huge selling point and very much a core benefit of Corporate Executive Board offerings, for example. This provides a “quasi-consulting” arrangement; Gartner is taking a middle-road approach with a more formalized client-driven research agenda that still allows analysts the final say as to topical coverage. We see this move as just a more formal feedback loop and a selling point rather than a huge change in how Gartner currently develops its research.
Transparency: As part of this announcement, Gartner stressed its broader move to more analyst “transparency,” including listing analysts on its Web site and stressing that the analysts would be more accessible; a sore point with many clients over the years.
In Outsell’s opinion, this move by Gartner comes at a good time and certainly aligns with increased demand for industry-specific IT research. We wouldn't say Gartner is late to the party, but it recognizes the need to have strong offerings for continued growth and to ward off additional competitive pressures. We are also glad to see Gartner make changes to what were sore points with clients, like access to analysts. It takes a long time to change a culture; this move shows Gartner is listening to clients and heading in the right direction.