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The 2014 CRM Service Leaders
For the rest of the March 2014 issue of CRM magazine please click here
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Interactive Voice Response

THE MARKET

The interactive voice response (IVR) market is expected to experience an estimated 10 percent compound annual growth rate through 2017, according to Global Industry Analysts. The investments are largely coming from smaller and midsized companies. However, analysts categorized the market as lackluster in 2013. "This has been an unremarkable year for IVR," says Paul Stockford, chief analyst at Saddletree Research. "Companies don't seem to be investing in product changes or improvements."

That's not to say that buyers of the technology aren't asking for changes. There is a growing demand, especially for natural language processing, within this market. Buyers also consider the integration of customer contact channels (such as voice, Web, social media, and mobile devices), the integration of self-service with agent-assisted service, and the ability to use speech recognition for user interface improvements to be critical system components today. Also considered vital are application development tools, flexible reporting, and comprehensive analytics.

Additionally, companies that were initially attracted to hosted and managed IVR solutions are continuing to demand cloud-based solutions. "It is clear that companies that offer a hosting option, either exclusively or as a hybrid, are growing more rapidly than vendors that primarily sell on-premises IVR solutions," says Dick Bucci, president and principal analyst at Pelorus Associates.

That's why, Bucci says, "the fastest-growing companies are broadening their market reach by using the cloud to move down market, by reducing initial costs and speeding implementation, and by developing function-specific modules that can be sold as turnkey installations."

Sheila McGee-Smith, principal analyst at McGee-Smith Analytics, agrees. "At the end of the day, the standalone IVR solutions from full contact center suite providers remain the choice of those that need to support sophisticated omnichannel applications," she says. "The IVRs that are part of all-in-one solutions can support the needs of as much as eighty percent of companies."

THE LEADERS

Aspect Software, a first-time leader last year, continues to impress analysts with its depth of functionality and company direction, scoring 3.9 and 4.1, respectively, in those categories. The acquisition of Voxeo this summer has "helped put Aspect out front in IVR," says Ray Wang, founder and principal analyst at Constellation Research. Stockford credits a number of factors for the company's success. "Aspect continues to have a strong offering that I suspect will get stronger as the company continues in its market direction this year," he says.

Cisco Systems, which pulled in scores of 3.9 in depth of functionality and 4.0 in company direction this year, was hurt again by its cost score, which averaged out to just 3.1. But overall, it continues to be a strong contender in the IVR space that has benefited from strong sales in its contact center solutions suite, according to McGee-Smith. In general, "based upon its overall strategy, Cisco continues to do a better job with IVR than most companies," Stockford adds.

Genesys Telecommunications Laboratories, a strong finisher year after year, continues to rebuild itself in the wake of its divestiture from Alcatel-Lucent, and analysts have definitely noticed. "We saw them just hitting their stride in the second half of 2013," Wang says. That's around the time that the company made several key acquisitions, including Angel and SoundBite. Because of those moves, Genesys scored a 4.2 in company direction this year. This year, as in past years, Genesys' real strength lies in its depth of functionality, where it scored a 4.0. "Genesys Voice Portal and its applications continue to be a shining star in the G8 portfolio mix," McGee-Smith observes. "It is part of most major deals and replaced several aging time-division multiplexing–based IVRs from competitors in 2013."

THE WINNER

Interactive Intelligence, last year's One to Watch, jumped to the top of the leaderboard this year with scores of 4.2 in company direction, 4.1 in cost, 4.0 in customer satisfaction, and 3.9 in depth of functionality. It has come so far in the past year that Stockford says it now "has a basic product that will challenge any of the other IVR offerings out there."

"Interactive Intelligence has been showing up a lot in our deals for 2013," Wang adds. "Its customer service is helping it win over larger customers as it goes up market."

ONE TO WATCH

Nuance Communications is more known for its speech recognition, text-to-speech, and voice biometrics solutions, but it is increasingly building market share in the contact center space as well with a number of strong IVR and personal assistant applications. Of particular note is the company's efforts with natural language processing, which ultimately will allow any IVR to be more forgiving and understand more caller responses. The system can simply ask the question"How can I help you?" and the caller will be able to respond in any way she chooses.

Web Support

THE MARKET

Increasingly tech-savvy consumers are constantly searching for the fastest way to meet their support needs, leaving many companies seeking vendors with comprehensive Web self-service capabilities ranging from traditional to newer offerings. Virtual agent solutions, for example, have long been on the Web support radar, but have recently become invaluable, as leaders in the airline, telecommunications, and financial services industries have begun relying on them heavily. "Virtual agents deliver one answer to a customer's question, not tens or hundreds or thousands of possible answers," Mitch Kramer, senior vice president and analyst at the Patricia Seybold Group, says. Virtual agents can escalate easily to live chat for more in-depth support, he explains, and some can also integrate tightly with case management systems. With high customer satisfaction ratings and low costs, virtual agents are the future of Web support and are here to stay, analysts agree.

THE LEADERS

Although a major player in the field, InQuira lagged behind competitors due to a post-acquisition identity crisis, some analysts say. Though Oracle has rebranded InQuira to fit under its Oracle Knowledge umbrella, "still missing is an integrated knowledge management system, a tight integration to case management, and cloud deployment," Johan Jacobs, independent research consultant and former Gartner research director, says. Nevertheless, the company scored an impressive 4.3 for depth of functionality and shows promise. "I's the best-in-breed Web self-service solution; however, as a standalone solution, it is missing the escalation channels from knowledge," Kate Leggett, principal analyst at Forrester Research, maintains.

Moxie Software reclaimed its spot on our leaderboard for another year as it continues to evolve its Spaces offering, moving from traditional search and knowledge management capabilities to focus on social and collaborative customer service. The company earned 4.0s for both company direction and customer satisfaction and has demonstrated a "good, appropriate vision for 2014," Kramer says. Despite a solid overall performance, the company has a "fairly basic Web self-service offering" in comparison to competitors in the space, according to Leggett. Faced with stiff competition this year, Moxie Software still earned respectable marks for depth of functionality, scoring an overall 3.9.

Despite mixed reviews from analysts, Oracle RightNow returned to our leaderboard this year. Dropping from a 3.5 to a 3.4 for company direction, Oracle RightNow has become Oracle Service Cloud and constitutes Oracle's "strategic cloud-based customer service offering," Kramer explains. However, since Oracle acquired RightNow in 2011, "its direction in the market [has been] poorly defined.... If it has a direction, then it is a closely guarded secret," Jacobs argues. After dropping from a 4.0 to a 3.8 customer satisfaction score in 2012, RightNow regained its 4.0 in the category this year. Its "breadth of customer service functionality is excellent," according to Kramer.

THE WINNER

Our winner for the third year in a row, Salesforce.com was unbeatable this year, with an unmatched 4.6 for company direction. "Salesforce has an excellent vision for customer service—a vision that is highly social and highly mobile," Kramer suggests. Salesforce has an innovative roadmap centered around Salesforce1, the new social, mobile, and cloud customer platform that the company unveiled in November. The platform, which allows companies to make all of their existing Salesforce apps mobile, social, and virtually future-proof, "extends [the company's] vision much beyond CRM," and makes it a force to be reckoned with, Leggett suggests. Salesforce received a 4.0 for customer satisfaction, but struggled somewhat in the depth of functionality category, earning only a 3.6. According to Jacobs, Salesforce.com has a "great CRM functionality, but a poor multichannel customer interaction functionality that is tightly coupled with the Sales or Service Cloud solutions."

To improve in the depth of functionality category, Salesforce.com needs to fine-tune the way its many solutions synchronize and couple with each other. Though there are already deep, effective integrations in place, there is always room for improvement, analysts agree.

ONE TO WATCH

EGain is this year's One to Watch, even though it beat category winner Salesforce.com in the depth of functionality category with a score of 3.8. Though the company received a 3.6 for direction due to its "limited vision" and "incremental improvements," it strikes a "good balance between cost and ability to customize," Leggett says. At the end of 2013, eGain introduced eGain Mobile—a solution designed to simplify mobile customer engagement through apps and unify it with other customer touch points—and analysts expect to see big things from the company in 2014.

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