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Omdia Universe

Selecting a Customer
Engagement Platform,

Author: Jeremy Cox, Principal Analyst
Publication date: 05 Nov 2020
Executive Summary
The customer engagement platforms (CEPs) included in this report have evolved from CRM systems. Whereas legacy CRM applications provided a system of record, CEPs offer a unified platform for customer engagement. The COVID-19 pandemic has exposed the limitations within many organizations in being able to engage with customers through digital means. CRM systems, often deployed in departmental silos, cannot support customers throughout their various interaction journeys. They lack individual customer context, artificial intelligence (AI) assistance, and automation to trigger the most relevant response at scale. CEPs, by contrast, have the potential to solve this complex challenge.
Figure 1: The Omdia Universe for Customer Engagement Platforms

Omdia View

Customers and consumers raised on the simplicity and predictability of digital-native commerce platforms, such as Amazon, Alibaba, and the like, expect the same joined-up and flawless experiences when interacting with any organization. Fragmented and product-centric organizations are unable to meet these rising customer expectations. They lack the organizational and systems coherence to sense customer intent and deliver a relevant in-context response.

Omnichannel customer engagement has been a top priority for several years, but progress has moved at a glacial pace. Back-office, supply, and logistics systems are often poorly connected to customer-facing systems, making it difficult for customers to know the status of products ordered or services consumed. The long-awaited 360-degree view of the customer has remained elusive (until now). It is usually limited to basic and transactional data that reveals little about the customer and their wants, needs, or behaviors. Fragmented data, systems, channels, and organizational silos prevent the oft-promised seamless experience now expected by customers.

Before the COVID-19 pandemic, transforming the customer experience was considered the lowest digital transformation priority out of nine initiatives monitored by Omdia. The Omdia ICT Enterprise Insights global survey (completed and published in September 2020) revealed a dramatic shift in importance; transforming the customer experience moved to the top of digital transformation priorities. 75% of enterprises consider customer experience more important since the COVID-19 lockdown. An analysis of customer-focused digital transformation over the last three years finds that in 2020 38% have made substantial progress, up 10% on the previous year. This, however, still means that 62% of enterprises are at risk of alienating their customers by not delivering insightful and relevant experiences.

CEPs provide a faster route to an omnichannel capability, especially when connected with operational systems to close the loop on brand promises and give customers much greater control. CEPs can be developed independently by enterprises by integrating existing technologies with the missing pieces from a wide variety of vendors. However, enterprises that have adopted this approach then have the ongoing challenge of incorporating updates from vendors whose applications have been developed on different code bases.

In this report, the vendors have either already done that integration work, integrating various acquisitions as they build their CEPs, or developed the entire platform on a common code base. Either way, by adopting a CEP suited to the business’s scale and industry requirements, enterprises can accelerate their abilities to sense, respond, and adapt at the right speed to enhance their customer relevance. That is the faster route back to growth post-COVID-19.

Key Messages

Market Definition

Omdia settled on the classification “customer engagement platform” in 2018. For several years it became apparent that traditional CRM systems were typically transactional and siloed in orientation. They provided, at best, functional support for sales, service, and to a lesser extent, marketing. They failed to meet the increasingly complex omnichannel customer engagement demands of high-volume B2C companies. They also lacked the intelligence triggers and engagement capabilities to support B2B companies in developing account-based marketing (ABM) or the more advanced account-based engagement (ABE) strategies (see the Omdia report The Evolution of Account-Based Marketing to Account-Based Engagement in B2B Enterprises).

CRM application components are still relevant, but they have been subsumed into CEPs. Some of the vendors now also include e-commerce and subscription billing to support product-as-a-service rentals rather than purchase. So, the more advanced CRM applications have now morphed into CEPs, although they can still be consumed on a modular basis by enterprises.

Figure 2 provides an idealized view of a CEP depicted as a Maslow hierarchy consisting of technology layers that contribute to the ultimate goal of dynamically orchestrating the customer experience, the
pyramid’s apex.

Figure 2: Customer engagement platform hierarchy

The functional support layer provides support for marketing, sales, service, commerce, and subscription billing. Customer engagement is enabled when customers can traverse their various journeys across whatever channels (digital or otherwise) they choose and achieve their desired outcomes. Employees are also part of the experience equation and need support to help them when interacting with individual customers. Several technology layers provide the necessary elements to support relationship building from personalization to creating trust. There may be industry variants in the form of specific regulations, templates, or data models that must be addressed. AI and robotic process automation (RPA) provide intelligence and automation capabilities that enable personalization at scale. Content and digital assets will need to be created and managed as part of the personalization capabilities. Security and compliance mechanisms are essential to protect customer data and ensure that it is only used where each customer has granted permission.

The ingestion, synthesis, and management of customer data from all enterprise systems and, potentially, from ecosystem partners and third-party sources provide the fuel for intelligent personalization. This report’s leading vendors have either developed or are developing customer data platforms (CDPs) that embrace customer data from all sources. Real-time synthesis merges historic and interaction data. The network of AI, machine learning (ML), and natural language processing (NLP) algorithms provides the triggers to generate a relevant response in guidance, content, or next best action. Therefore, customer data management is fundamental to the effective use of AI, which in turn needs to be networked across customer journeys to orchestrate relevance at each step. Rules-based approaches do not scale.

The pyramid base is the essential plumbing, cloud infrastructure providing software-as-a-service (SaaS) and platform-as-a-service (PaaS) support and APIs to connect to adjacent operational or other systems. Mobile communications are vital, and eventually, 5G will play an integral role, especially for advanced augmented reality / virtual reality (AR/VR) use cases and edge computing.

For this report, vendors were evaluated based on their responses to a series of probing questions across the following categories, which follow a similar hierarchy to that depicted in Figure 2.

Customer Experience Orchestration
Questions were asked about how customer journeys can be supported across any channel and provide an unbroken path across any department that might be involved. Customer journey analytics (CJA) and visualizations can help customer experience (CX) leaders refine and create a fluid environment. Each vendor was asked to explain what visualizations and feedback mechanisms are provided. The decisioning engine’s nature was also explored to understand what level of support is provided across customer journeys to trigger the next best actions.

Marketing Automation
Marketing automation capabilities are essential for communicating the potential value of products and services, but if the timing or segmentation is poor, they fail to resonate with each customer. The ability to dynamically adapt messaging and timing based on the individual customer’s context was also explored.

Sales Force Optimization and Automation
Salespeople represent a high cost, so for this section, four significant aspects were explored:

Customer Service Automation and mManagement
Agent, field-service, and self-service support were examined. Of particular importance is the ability to understand the customer’s context and resolve queries quickly or route complex queries to the right expert, wherever they are in the organization. For field service, planning and routing, diagnostic support, and the use of advanced AR/VR tools were reviewed. Self-service capabilities and use of virtual agents and escalation procedures were also examined.

E-commerce and Subscription Billing
Not every vendor has its own e-commerce solution, but those that do not have one typically connect via APIs and share data with third-party vendors. The scope of the e-commerce solution was reviewed, covering B2B, B2C, or both. The ability to dynamically trigger relevant offers based on individual customer profiles and behavioral cues was also examined. Architectural aspects, such as headless or progressive web apps or extensions via microservices, were included. Subscription billing is increasing in importance as businesses adapt their business models to support “product-as-a-service,” so this was also reviewed.

Content Management Services
Questions were asked about content production and management and the associated intelligence to trigger the most contextually relevant content. The ability to render content to suit any device was also examined. Some vendors partner to provide content management system/digital asset management (CMS/DAM) services, typically via APIs. This was reflected in their overall scores. Other questions covered a range of content attributes including workflows between content creators, agencies and production teams, and content rights management.

Intelligence and Process Automation
This section goes to the brains and nervous system of the CEP. What was of particular interest is the extent to which AI and automation capabilities could support cross-journey next best actions. This goes beyond intelligence to help a specific employee role or is tied to a particular function. Ethical guardrails were also examined, including advanced support such as bias and empathy detection.

Security and Compliance Mechanisms
A range of security and compliance mechanisms were evaluated, including consent and permissions, encryption, intrusion detection, and access controls.

Customer Data Management
This provides the essential fuel to trigger relevance and dynamic orchestration of the customer experience. This report’s leaders either have CDPs that can ingest data from any source or expect to have a fully functioning enterprise CDP in place within this report’s lifetime (2020/21).

Cloud Platform
Some of the vendors in this report have their own cloud infrastructure. In contrast, others use one of the major cloud infrastructure providers, such as AWS, Google Cloud, or Microsoft Azure, or can provide their CEP on a client’s preferred hosting environment, public or private.

Market Dynamics

The value of a CEP is more than the sum of its individual functional parts. To reflect this, additional weightings were applied to experience orchestration, AI and automation, and customer data management.

Consumer behavior and rising customer expectations are driving the evolution of CEPs. The COVID-19 pandemic has added a sense of urgency as face-to-face interactions in B2C, B2B, B2B2C, and G2C environments have been replaced by digital means. As we have seen, this is reflected in Omdia’s latest global ICT Enterprise Insights annual survey, which covers more than 6,000 midmarket and large enterprises across all sectors.

Any friction source creates a barrier, and customers are less forgiving if their interaction experience is interrupted or broken because of organizational or system silos. The pandemic has highlighted the need for a more purposeful, coherent, and connected digital environment. CEPs will only grow in value as they fulfill the demands of omnichannel customer engagement. Several factors will affect enterprise investment decisions. In part, these will depend on the enterprise’s existing IT landscape and to what extent it can harness existing systems or needs to replace them. The short list for selection may also depend on the enterprise’s industry and the associated data models and regulatory environment.

Customer engagement will continue to evolve, but despite AI advances, there will be a need for human-to-human interaction, potentially aided by AI and automation. A customer-centric orientation will resonate with customers, especially when their desired outcomes are the guiding consideration. Six principles can guide enterprise thinking (see the Omdia report The Gravitational Laws of Customer Experience):

It is fundamentally a challenge of values. The approach Omdia has taken in evaluating each vendor is not a simplistic and superficial features comparison but an assessment of each platform’s ability to enhance the customer experience. Customer data management, AI, and automation, and customer experience automation have been given extra weightings. Functional parity within each technology layer is less important than how successfully each contributes to the highest customer value level to orchestrate the customer experience in real time. This differentiates this study from the many point-solution evaluations by many analyst firms. Vendors were selected based on their proven abilities to support a more unified approach to customer engagement that goes beyond traditional legacy CRM systems. Because of this, all the vendors in this report are classified as either “leaders” or “challengers.”
Figure 3: Vendor rankings in the Customer Engagement Platform Universe

Market Leaders

The CEP market is intensely competitive and has evolved from legacy CRM to provide a hybrid system of engagement, not just record. Like in a never-ending Formula 1 race, rankings are likely to fluctuate continually. Each of the leaders deserves a place on the shortlists of large enterprises. The more progressive enterprise recognizes the importance of placing the customer at the center of its operational and customer engagement strategies. These leading CEPs can support that.

What distinguishes the market leaders from the Omdia Universe’s challengers is that they have all taken substantial steps toward a unified platform capable of supporting customers across their diverse and often chaotic customer journeys. They also support all business models, including B2B, B2C, B2B2C, and G2C. They provide critical ingredients to support channel-agnostic customer engagement, including enterprise-level customer data management and advanced and connected AI to sense, respond, and trigger the next best actions. There are marginal differences between them, but Oracle and Pegasystems stand out and share the top ranking.

Since the 2018 predecessor to the Omdia Universe (Ovum Decision Matrix: Customer Engagement Platforms, 2018–19), Oracle’s development teams have taken a longitudinal approach, especially related to AI advances, that spans the Oracle Cloud CX applications and uses data ingested across the entire value chain to deliver a true omnichannel capability. Oracle’s data heritage, a foundational element for personalization, has also come to the fore.

Pegasystems has proven its leadership credentials with an outstanding ability to orchestrate relevance throughout all customer journeys. It continues to push the boundaries on AI and adds real innovation such as bias detection, empathy scores, and real-time optimization based on outcomes. It continues to hold the number one ranking.

Microsoft, Salesforce, and SAP have also taken considerable strides to elevate their capabilities. They each have their unique strengths and are marginally behind Oracle and Pegasystems, but there are clear signs that the race is far from over. Adobe also deserves its place at the top table. What it lacks in functional capabilities in sales and service automation, it more than compensates for with its ability to orchestrate relevance throughout all customer journeys. It is also the home of creativity in content production and continues to push the boundaries through the marriage of AI and content. Its deep partnerships with Microsoft and ServiceNow enable it to compete at the highest level.

Market Challengers

ServiceNow and SugarCRM are at the front of the challengers’ pack. ServiceNow offers a different approach from all other vendors with its service orientation and ability to orchestrate workflows across the enterprise. While it lacks functional capabilities outside of service and field service, it has a rapidly growing fan base among enterprises developing a coherent cross-organizational capacity to enable their employees to deliver the highest customer service standards.

SugarCRM has substantially rebuilt its platform on AWS, which gives it access to some of the most advanced AI tools from Amazon. It is purposely focused on B2B, and if this report was limited to that market, it would be a leader. Its focus on time-series intelligence enables it to sense trends and uncover otherwise hidden opportunities.

Zoho has long been associated with the SME market, but since the launch of Zoho CRM Plus, it has quietly been amassing midmarket and larger organizations attracted by its unified platform and intuitive simplicity. It owns and develops the entire technology stack, which gives it greater control over pricing and security, and now operates in more than 180 countries; watch this space.

Creatio is also a worthy challenger. Its unified platform, increasing AI depth, business process management (BPM) capabilities, and no-code/low-code app development capabilities make it a highly flexible and adaptable platform. It is also one of the highest rated from a Net Promoter Score (NPS) perspective and appeals to midmarket and an increasing number of larger enterprises.

Market Outlook

The COVID-19 pandemic has elevated the importance of digital across the enterprise from a tactical, nice-to-have capability to a strategic necessity underpinning survival. Beyond the pandemic, every business will seek to reestablish growth momentum. Channel-agnostic customer engagement and delivery of a differentiated experience are rapidly emerging as essential capabilities in the growth toolbox.

It is no secret that annual investment in CRM applications is still the largest slice of enterprise applications spend. Omdia’s latest annual enterprise software forecast, published in September 2020, confirms this and predicts annual spend to have reached over $71 billion by 2024, compared with $34 billion for cloud-based enterprise resource planning (ERP). Customer engagement platforms include CRM modules but also commerce applications as an essential engagement mechanism. Commerce applications are expected to grow at a CAGR of 14.49% versus 14.15% for CRM and 11.29% for ERP. However, the fastest growth rate is that of supply chain management (SCM) at 17.02% to 2024.

This highlights a significant reconfiguration on the value chain’s supply side to meet expected/hoped for demand, supported by digital customer engagement improvements to win and retain customers. Operational excellence meets customer experience superiority. Post-COVID-19, speed will replace resilience as a sought-after capability. Creating an environment for rapid adaptation will require deep connections across the value chain and between the operational backbone and customer engagement systems, back office, and front office in sync.

Another tool in the growth toolbox is innovation. This will include new products, services, and experiences as well as adaptive business models. The old legacy approach of building or deploying one application a department at a time will not meet the emerging challenges in dynamic markets and continuously rising customer expectations. The old method will be too slow. Recognizing these limitations and strategic imperatives, the more progressive organizations will adopt platform thinking, supported by last-mile reusable and modular microservices. Stripping back large organization complexity to refashion a more fluid and coherent environment will require three types of interconnected platforms. Trusted data will provide the essential fuel supported by pervasive AI to drive insights and trigger relevant automation. The three interlinked platforms will be

Operational excellence, superior customer experience, and continuous innovation will be the value disciplines that will shape success.

CEPs, therefore, must be part of this coherent organizational story, and as such, they will deliver value way beyond the limited functional support provided by old CRM systems. The vendors in this Omdia Universe are at the forefront.

Vendor Analysis

Oracle Cloud CX (Omdia Recommendation: Leader)

Oracle Cloud CX should appear on your short list if you want to optimize your business for customers.
A shared vision drives Oracle and the Oracle CX applications and platform developers: bring the front- and back-office processes together to empower whoever gets to the customer first. When implemented as part of an enterprise-wide CX strategy, this enables true omnichannel. It supports a highly responsive and adaptive enterprise.
Figure 4: Oracle : Customer Engagement Platform
Oracle is helping customers adapt and compete by:

When supply is deeply connected to customers’ demand signals, entire supply chains can be rerouted to support sudden hikes in demand. Oracle is one of the only vendors that can support the back office (where critical CX data lives), financials, supply chain, ERP, order management, product, pricing, and contracts, all associated with fulfilling the brand promise.

While individual applications are continually evolving, Oracle invests heavily in cross-application, cross-platform development to create and harness a unified adaptive CEP. This is a significant reason why Oracle is ranked equal first in this Omdia Universe.

There has been a significant shift in emphasis over the last year from a narrow focus on best-of-breed applications to a more coherent platform-wide perspective to enable real omnichannel CX. Oracle Cloud CX is now a highly effective and deeply integrated CEP. While enterprises can deploy single applications to solve individual departmental challenges, they will derive much greater business value from a unified platform to underscore a strategic customer-focused digital business transformation. Oracle’s market-leading breadth of applications, covering marketing, sales (including CPQ), service/field service, commerce, and content, is not the main story.

What make Oracle stand out as a leader among leaders are the capabilities that elevate its CEP to dynamically orchestrate value to the enterprise customers across any customer journey. This is achieved through several critical technologies:

Oracle continues to leverage its in-depth industry knowledge to develop industry-specific data models and best-practice processes to improve the CEP’s overall performance as the customer-facing component of the specific industry’s value chain.
Oracle Cloud CX, supported by the Redwood UX, provides some excellent and practical analytic visualizations to help employees perform their tasks to a high standard. What would be particularly useful to the more advanced customer-centric organizations is to gain insights into interaction traffic, including alerts or highlights to surface sources of experience friction. Customer behaviors evolve, and expectations continue to rise. Seeing where the experience is suboptimal would enable the enterprise leadership team to understand the issues and provide resources to create a more fluid experience. Even better would be if the financial impact could be quantified based on lost revenue and customer defections. While customer feedback provides some of the answers, system-level telemetry could provide quantified evidence.
Oracle Cloud CX is applicable for midmarket and large enterprises across all sectors and industries. Oracle has a large customer base, with many customers still using old legacy CRM systems and applications. The COVID-19 pandemic has reinforced the need for digital business capabilities and increased the urgency for digital transformation. Oracle needs to articulate more clearly the case for a platform approach and counter concerns about potential lock-in. By leveraging its more advanced customers through case studies and at virtual conferences, Oracle can make the case for Oracle Cloud CX more forcefully and convincingly. The market for CEPs is growing as businesses seek better ways to retain customers and attract new ones. Oracle is in a prime position to capture this growth.
Each of the leaders in this report is a potential threat to Oracle, and the biggest, given its high market share in CRM, is Salesforce. Microsoft and SAP are also forces to be reckoned with, having adopted a similar enterprise-wide strategy. Pegasystems has led the unified platform approach in large enterprises, most notably in financial services and communications. Adobe has a rapidly growing CMO fan base and is likely to be a competitor where CMOs are the main sponsor. Similarly, despite being a challenger in this report, ServiceNow is a significant competitor in customer service and field service. The other challengers in this report, Creatio, SugarCRM, and Zoho, are more likely to be Oracle NetSuite competitors.

How to Use This Report

Omdia is a proud advocate of the business benefits derived through technology. Customer engagement platforms are at the forefront of realizing benefits to businesses and government organizations across the globe. The Omdia Universe report is not intended to advocate an individual vendor but rather to guide and inform the selection process to ensure all relevant options are considered and evaluated efficiently. Using formal selection criteria, Omdia picks the leading solutions in the market for comparison, so inclusion in the Universe is in itself an accolade. Using in-depth reviews on TrustRadius to derive insights about the customer experience together with the analyst’s knowledge of the market, the report findings gravitate toward the customer’s perspective and likely requirements. The focus is on those of a medium-to-large multinational enterprise (5,000-plus employees). Typically, deployments are considered across the CPG (consumer packaged goods), financial services, manufacturing, retail, TMT (technology, media, and telecoms), and government sectors globally.


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about the Author
Gabriel Brown
Principal Analyst, Heavy Reading

Gabriel leads mobile network research for Heavy Reading. Starting from a system architecture perspective, his coverage area includes RAN, core, and service-layer platforms. Key research topics include 5G, LTE Advanced, virtual RAN, software-based mobile core, and the application of cloud technologies to mobile networking.

Gabriel has more than 15 years’ experience as a mobile network analyst. Prior to joining Heavy Reading, he was Chief Analyst for Light Reading’s Insider research service; before that, he was editor of IP Wireline and Wireless Week at London’s Euromoney Institutional Investor.