I appreciated your article about the sources of analyst revenue. However, from my own observations and input from many vendors, I have the impression that for firms based in North America, your data is skewed. I have heard repeatedly that there are very few analyst firms that derive a significant portion of their revenue from end users. I have often puzzled over this – if an analyst firm does not influence purchase decisions or general market perception, then why do vendors spend money with that firm? Although it doesn’t seem to make sense, vendors continue to do that. It is true that some of those firms offer unique insights and advice – and as such would be more appropriately classified as consultants and part-time freelance writers, regardless of what it says on their business cards. I have a theory – if vendors were to limit their spending to those firms with end-user influence, most Tier III firms would fold. What do you think?

1. If the vendor buyer is a market intelligence manager, they often want highly structured data rather than insight. That rewards firms with niche expertise. As we all know know, with five or ten analysts in a single niche an analyst firm can go deeper than Gartner or Forrester in most segments.
2. On the other hand, if the buyer is a marketing manager then often they want love. They don't want difficult conversations; they want mirrors. So, again, there is not much interest there in real end-user rapport.

Part 1 would fall in the category that I labeled “consultant”.  the second category would explain how some seemingly clueless firms manage to survive. (The emperors do like to be complimented about their new clothers.)  I agree with you about the end user side. I would also add that, like vendors, end user requirements for level of expertise can vary significantly. based upom my experience at EMA™ I can have observed that there are engagements that require real in-depth subject matter knowledge. There are also subscribers who do nothing but read the published reports – this is high-class journalism. Other subscribers will make use of the inquiry function and that is another time when a moderate to high degree of subject matter knowledge is required.