Navigating the Enterprise IT landscape

Information Technology is today the backbone of every business and enterprise IT (EIT) has emerged as a major industry. But only now has it begun to receive the recognition it deserves.

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 the information technology sector, so to does the power of the chief information officer (CIO). It is the CIO who oversees key recommends and purchases of IT solutions. 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.

Frank Stepan, general manager SDA Asia Pacific, says the compound annual growth rate (CAGR) on the service oriented architecture (SOA) market in Asia alone will increase 40% year-on-year until 2010 - which by then will be valued at some US$2billion.

"So, there's no excuse for IT marketers not to fight for a big piece of this big cake," he says.

Enterprise IT cover 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 EIT works like a niche or a specialised B2B industry, meaning IT marketers do not necessarily target their products or solutions to a mass market.

According to Prasannavadan Gaitonde, manager at 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 says.

This means that 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 that it is understanding the IT decision making process that is the toughest part of the job.

Azhar Azib, director of the Central Marketing Communications Group at Microsoft Asia Pacific, says IT solution purchase decision making is today a complex process, with many joint decision makers and business stake holders having significant influence over what is finally acquired.

"Yes, it makes the job of the marketer difficult, but not because the audience is limited," he says.

"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 the marketing process.

"So if you are marketing a CRM solution, you need to recognise that besides IT, the finance, marketing, customer services and  sales will have a significant stake in the decision process," Azib adds.

The buying decision for EIT often involves multiple stakeholders ranging from the line of business executives, CIO to 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," Chris Tan, director of marketing at IBM, says.

"For example, an integrated program to engage the IT managers on issues and solutions that are most relevant to them such as IT optimisation or governance and risk management."

Mark Phibbs, regional director of marketing at Adobe, argues that the decision makers are sometimes not the people using the software from day-to-day, and says the end purchaser needs to be able to demonstrate both technical expertise and have a solid business understanding of the IT process.

The result of this complex decision making process means that 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 businesses need to recognise that a problem actually exists.

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

Microsoft has its own analytics tools designed to identify "eligible and ready" companies. They also have 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," Azib adds.

Business intelligence, custom research, databases, white papers taken out  by independent sources and company themselves then play an essential role is addressing this issue.

Andrew Smart, Asia regional manager at Fairfax Business Media, argues accurate business intelligence helps to ensure you connect 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," Smart says.

Fairfax Business Research (FBR)  provides IT marketers with business intelligence on more than 20,000 of Asia's largest enterprises. 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 sda-asia.com also provides  information to IT decision makers and IT marketers and helps both make the "right  business decisions".

Microsoft's Azib says: "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 its software to diverse environments.

Phibbs says: "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 says.

Azib says: "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."

Industry experts agree that print, TV, online will all continue to be a popular choice for IT marketers.

Chris Tan says that IBM uses a "full gamut" of media tools such as newspapers, magazine, web (both IBM and third party), trade associations and industry publications.

"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," he says.

"For example, with a web campaign, traditional metrics such as unique visitors, click throughs, calls to our marketing response centres and of course, leads."

Whether an EIT 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 used through any media is focused.

Phibbs says, "With Enterprise it is more targeted with small events, edm, direct marketing, search with targets with the IT organization and business units."

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 ibm.com interactive and call centre capabilities in the region. 

Web2.0 too is predicted to become 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 it's very own domain," Stepan from SDA Asia which provides magazines, online portals and events to connect IT marketers with IT decision makers, says.

Smart says online and events are a growing part of the business and an emerging trend in IT marketing.

"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 utilized," he says.

Role of PR

Traditionally an integrated marketing mix encompasses all the different disciplines like advertising, PR, direct marketing and online marketing. However in recent years PR has become a vital tool for marketers.

Research show that PR is being allocated the biggest share of the marketing budget when compared to the rest of the media mix.

But what makes PR a vital component in an enterprise technology companies marketing efforts?

Jeremy Woolf, managing consultant at Text 100 Public Relations Hong Kong, says the ultimate goal is to influence a skeptical, time poor and marketing-savvy audience, who increasingly show a lack of trust in advertising and other mass marketing techniques. 

"To accomplish this, they need to find a balance between seeking influential third party endorsement, news media and engaging in direct dialogue with their customers through social media such as blogs, social networking sites and discussion forums," he says.

Woolf highlights the 2007 ITtoolbox/PJA IT Social Media Index: Wave II Survey of more than 4,400 IT and business professionals, which shows that topic-based networks and personal networks were the most important sources of information in the final stages of purchase.

According to Woolf, analytical tools such as Vocus analytics, Biz360 and Meltwater are good indicators of share-of-voice. 

Which brings us to the question of potent tools of IT PR.

"Mainstream media relations is the most sought after enterprise IT public relations tool in Hong Kong, followed by analyst relations and influencer relations. In terms of whether particular media outlets are preferred over others, it really depends on objective and audience," Woolf adds.

He says a more business-centric enterprise IT marketer would  be inclined to influence a C-level audience and the best choice would be the South China Morning Post or Hong Kong Economic Times business section.

But if a marketer wanted  to raise the profile of a product or service with IT managers, Computerworld Hong Kong or Sing Tao Daily IT Square would be a media choice.

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.

Measuring success

Analysts say that 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 is to sell, then how many have signed up.

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 Bill Gates made a comment about 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," the Microsoft chairman says.

This comment has stirred up a mini debate of sorts in technology websites, blogs and magazines. An opinion encountered in most blogs is that since majority of employees in companies do not make decisions about enterprise IT, news on business software hardly ever affects them. That in turn makes media disinterested.

Another argument that has emerged is that IT divisions never get credit from businesses as a reason for their growth, on the contrary they often get blamed for the losses, which might explain apathy from media.

Some bloggers have 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.

Chris Tan says: "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." 

Phibbs says the reason for this is obvious. "The mass audience is only interested and concerned about news that directly affect 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," he says.

Azib offered an alternative 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.

"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 says.