The in's and out's of enterprise IT marketing

With Information Technology becoming the backbone of every business, enterprise IT has become a big business by itself. But it is only now that it has begun to receive the recognition it deserves. Asiya Bakht reports.

Any firm - large or small - that fails to see the connection between growth and the state of its IT infrastructure leaves itself vulnerable to competition. To the uninitiated, enterprise IT is the software platform that is used to resolve an enterprise problem. And the division that is primarily responsible for introducing and managing it is the IT division of a typical firm. As dependence on IT grows so does the power of the Chief Information Officer (CIO). It is he (and sometimes she) who recommends the IT solution for purchase. But with so many service providers offering so many solutions the CIO's job is not getting any easier. Nor is the job of the marketer who is trying to sell it. But here's the good news... while the competition is turning stiffer the pie is getting bigger.

According to Frank Stepan, general manager, Asia Pacific, S&S Media, publisher of SDA Asia, the Compound Annual Growth Rate (CAGR) on the Service Oriented Architecture (SOA) market in Asia alone will increase 40% until 2010 - a market that will then be US$2 billion (S$2.9 billion). "So, there's no excuse for IT marketers not to fight for a big piece of this big cake," he said.

Enterprise IT covers under its umbrella firms that provide applications (software), hardware required to run the applications, services including consulting services, installation services, implementation services, integration services and maintenance services. Typically, enterprise IT works like a niche or a specialised B2B industry and that means IT marketers do not target their products or solutions to masses.

According to Prasannavadan Gaitonde, research manager, AMI-partners, modern day IT solutions need to have high uptime, reliability, scalability and resiliency. "Enterprise IT is characterised by changing solutions, new technologies, rising costs, high training needs and consolidations due to lowering margins. Large vendors can end up dead within a few years if they don't track the change," he said.

This means the IT industry is in a constant state of flux and marketers have to be attuned to these changes to retain their customers.

The Challenges

Even though there are many aspects of enterprise IT marketing that make it challenging, most marketers agree it is understanding the IT decision making process that is the toughest part of the job.

Azhar Azib, director, central marketing communications group, Microsoft Asia Pacific, said, "IT solution purchase decision making these days is a complex process with many joint decision makers such as business stakeholders who have significant influence over what is finally acquired. Yes, it makes the job of the marketer difficult, but not because the audience is limited. It is tough because the marketer now needs to understand the decision making and influence structure within these enterprises".

Value propositions, contact strategy and call-to-actions are quite different for different role holders associated to the same solution. The more complex the problem, the more sophisticated is the solution. And the more sophisticated the solution the more challenging becomes its marketing. "So if you are marketing a CRM Solution, you need to recognise that besides IT, the finance, marketing, customer services and sales departments will have a significant stake in the decision process," Azib said.

The buying decision for enterprise IT often involves multiple stakeholders ranging from the line of business executives, CIO to the IT managers and even to the IT practitioner level. This makes it a more complex marketing challenge which requires clarity and discipline to address the differing needs and motivations of each stakeholder.

"At IBM, we've evolved our marketing strategies to tune our offerings and messages by these stakeholders. For example, an integrated programme will engage the IT managers on issues and solutions that are most relevant to them such as IT optimisation or governance and risk management," Chris Tan, director of marketing, IBM, said.

Mark Phibbs, regional director of marketing for Adobe, said, "The decision makers are sometimes not the people that use the software day by day and thus you need to be able to demonstrate both the technical and business value of the solution."

The result of this complex decision making process means making a deal can take an extraordinarily long time. So unlike consumer products where the sales cycle is faster and product value is lower, IT solutions can cost companies millions of dollars and take considerable time.

Another formidable task for marketers is to figure out is just who is likely be their potential customer and how to approach them. Some solutions have prerequisites like technology platform or capabilities maturity. In some cases the businesses need to recognise that a problem exists.

"We need to understand which companies are ready for the solution before targeting the individuals within these companies," Azib said.

Microsoft has its own analytics tools designed to identify ‘eligible and ready' companies. It also has statistical models to predict propensity and buying readiness at the company level.

"Only after we have reconciled the company level prospects list do we talk about the individuals. This is where all that research about role and influence comes in. Marketing treatment is applied to the individual, but the benefit statements need to address both the individuals (departmental) as well as the overall company needs," he said.

Business intelligence, custom research, databases, white papers taken out by independent sources and the company itself then plays an essential role in addressing this issue.

"Accurate business intelligence ensures you connect with the right person, with the right information, the first time. This saves time and money while increasing revenue and it protects your brand from the negative perceptions associated with bothering the wrong person with the wrong information," Andrew Smart, Asia regional manager, Fairfax Business Media (FBM), said.

Fairfax Business Research (FBR) provides IT marketers with business intelligence on over 20,000 of Asia's largest enterprises while FBR's MarketBase is a set of user databases covering C-level executives and IT infrastructure in nine countries. FBR's custom research services include surveys, supplements and white papers.

Similarly SDA Asia magazine and its online portal also provides information to IT decision makers and IT marketers and helps both make the "right business decisions".

Azib from Microsoft Asia Pacific said, "The most important component in the marketers toolkit are targeting and segmentation tools - analytics capabilities that help the marketer understand which companies are ready to have that conversation. Everything else, including creatives, take on a secondary role."

For companies like Adobe, the challenge is not so much in finding the right enterprise as customising their software to diverse environments.

Phibbs said, "Our markets are quite diverse, and we would need to customise the benefits of our software to a variety of target industries which for Adobe include - government, education, financial services, manufacturing, and the architecture, engineering and construction markets."

Another critical aspect of EIT marketing is for marketers to understand the ambition of the firm they are targeting. How a certain software could create a competitive advantage for a company in the long run is something that marketers need to persuade their customers about.

"The obvious objective and also our challenge is to be able to address the various benefits and what business ROI the software will bring to the company," Phibbs said.

"Enterprises have aspirations too and enterprise IT plays a big role in helping companies achieve these by enabling key capabilities. A marketer should understand what these ‘ambitions' look like and also the ‘roadmap' leading to the end state," Azib said.

A talk with industry experts revealed that print, TV and the web will all continue to be popular media choices for IT marketers.

an of IBM said his company uses a "full gamut of media tools such as newspapers, magazine, web (both IBM and third party), trade associations and the like. What are changing are the mix, strategy and tactics to engage with these media. Measurements of success are tool specific with some more easily available than others. For example, with a web campaign, traditional metrics such as unique visitors, click throughs, calls to our marketing response centres and of course, leads, are used."

Whether an enterprise IT solution or a software is marketed through a event or a conference or a blog, a common thread is that marketers know their target audience customers. That is why advertising or PR campaigns applied through any media is focused.

"With enterprise IT marketing, it is more targeted with small events, e-dms, direct marketing and search marketing with targets with the IT organisation and business units," Phibbs said.

Another emerging trend with regards to media is the growth of online media as a marketing tool. Last year, IBM launched an initiative on Second Life which has a virtual Business Center that offers a place for IBM sales people, clients and partners to meet and conduct business together. It is backed up by its existing website and call centre capabilities in the region.

Web 2.0 too is predicted to become very relevant for IT marketers as it has considerable potential for focused and targeted marketing opportunities.

"The web is the ideal place for IT marketers anyway, because where can you reach a target group better than in its very own domain," Stepan from SDA Asia, which also provides channels, such as magazines, online portals and events to IT marketers to get in contact with IT decision makers, said.

On the current and emerging trend in IT marketing, FBM's Smart said, "Spend for online and events have been rising while print has been stable. Campaign integration is improving but is still not well coordinated with PR initiatives. Asia-centric multi-media and custom research remains under utilised."

Role of PR

Traditionally an integrated marketing mix encompasses all the different disciplines such as advertising, PR, direct marketing, online marketing and so on. However in recent years PR is becoming an increasingly vital tool for marketers. Research shows PR is being allocated the biggest share of the budget as compared to the rest of the marketing mix.

So what makes PR a vital component in enterprise technology companies' marketing efforts?

Marc Ha, practice lead, Text 100 Singapore, said, "the complexity of the technology, and consequently the complexity of the messages" have elevated the standing of PR.

"In multi-million dollar IT implementations, it is natural to expect many decision makers involved in the evaluation process, from the IT managers through to the CIO and even the CEOs. The message that you communicate to an IT manager versus an IT Director/CIO versus a CEO are intrinsically different, and you need to tailor your messages and proposition for each of these audiences in a way that is meaningful for each of them."

Ha cites another reason for the increasing popularity of PR; the rise of peer media platforms such a wikis, blogs and discussion forums

"People are now empowered to have a voice and have gained the ability to engage in dialogues with organisations. Again, PR is the only discipline that is equipped to handle a dialogue-based communications environment that has emerged today," he adds.

Typically PR agencies employ a selection of tactics to interest the IT decision makers and these include press releases, interviews, briefings, round tables, opinion articles, case studies and white papers.

Ha points out that "the innovation or creativity is in how you bring the subject matter to life; how you address the hot buttons to engage the different audiences".

Measuring success

Analysts say measuring the success of a media tool usually depends on the objective of the marketing campaign. If objective was to educate the customers then its success could be gauged from what the client have understood and if the right messages been accepted by the clients. If it was to sell, then how many have signed up is the benchmark.

Phibbs divides the methods of success in these categories.

• Capture: How many new target customer permissions have been established as a result of the activity?
• Maintain: How many target customer contacts have responded to this specific communication?
• Upgrade: How many target customer contacts have responded in a way that gives you permission to take the dialogue to the next level?
• Close: What revenue has been generated from the leads?
• Cost: What was the cost of each of the above?

Is covering enterprise IT boring?

In December last year, Microsoft chairman Bill Gates made a comment about the media's lack of interest in business software.

"The business computing market, which is way bigger than the consumer computing market, no one pays attention to it," Gates said.

This comment has stirred up a mini debate of sorts on the technology blogs. An explanation that has come up on various blogs is that the workers in companies do not make decisions about enterprise IT and that is why news on business software hardly ever affects them. That in turn makes media disinterested.

Another argument that has emerged is that businesses never give credit to their IT division as a reason for their growth. On the contrary, IT divisions often get blamed for any losses.

Some bloggers have simply alleged that journalists display lethargy in covering business software simply because they themselves find it difficult to comprehend the subject.

Discussions with the marketers in Singapore revealed several reasons for this.

IBM's Tan said, "It is not a great surprise that consumer IT commands more media attention since, by definition, it affects more people in a more direct way. However, we find that in our quest to target and talk to enterprise IT decision makers it is becoming more important to engage, even up to the end-user level, as technology becomes more visible to the end-user beyond just the device."

Adobe's Phibbs said, "It is obvious why this is so. The mass audience is only interested and concerned about news that directly affects them. In order to gain readership and ultimately advertisements, newspapers, magazines and even blogs will write about topics that their target markets are interested in."

Microsoft's Azib offered an interesting perspective on how this trend is changing and the business IT is starting to become more glamorous.

"To the average person on the street, enterprise IT will appear very boring. This is especially true with the ‘old' way of addressing enterprise IT - point solutions, product centric and very IT professional targeted. However, as marketers take a more holistic and capabilities centric approach to enterprise IT, a lot of the ‘sex appeal' that you find in consumer IT and in consumer marketing are starting to show up."

He talks about how enterprise IT solutions today talk about connections and collaboration - for example, salesforce automation is marketed with taglines such as ‘Connecting Your Mobile Workforce' and CRM is marketed with ‘Building Customer Connections'.

"These solutions don't just talk about the boring business stuff like productivity and more efficient resource management, but it also brings into the fold consumer centric capabilities like really cool mobile devices and instant messaging, mobile internet and global positioning," Azib said, giving the example of the "ultra sexy PDA phone" which has now become now a business tool.

[Box out 1]

Top sites for computer hardware in Singapore
Rank	Domain	Market Share
1	forums.hardwarezone.com.sg	15.48%
2	www.apple.com	9.16%
3	www.hardwarezone.com	8.90%
4	global.acer.com	6.57%
5	www.ap.dell.com	5.76%
6	forums.vr-zone.com	4.93%
7	www.hp.com	4.54%
8	www.lenovo.com	3.17%
9	www.asia.apple.com	2.38%
10	www.ibm.com	2.31%
11	www.engadget.com	2.11%
12	sg.fujitsu.com	1.97%
13	reviews.cnet.com	1.79%
14	www.linksys.com	1.34%
15	www.vr-zone.com	1.18%
16	www.dell.com	1.02%
17	www.gemtek.com.tw	0.96%
18	www.tomshardware.com	0.91%
19	www.ppcsg.com	0.83%
20	www.canon.com.sg	0.79%
Weekly rankings for the week ending 19/01/2008, ranked by 'Visits'
The Hardware category lists all manufacturers of hardware and peripheral computer components as well as sites that offer news, technical information and reviews.
Source: Hitwise Singapore - sg.hitwise.com