We begin March with mixed economic news: reports of a general turnaround gathering steam countered by signs of continued weakness in IT spending. Focusing marketing activities on key clients and segments remains the top priority at most technology firms, with special attention to crafting value propositions and return-on-investment presentations. This month's E-ZINE pitches in with guidelines for ROI tools, a new report on online marketing, and the launch of several new brand studies, along with our usual notes on upcoming events, a new tool, and other features. Let us know what you're doing with to win and keep clients happy in these still uncertain times.

—Rob Leavitt, editor and ITSMA's director of member advocacy

What's Hot: Getting Real with ROI

It's no secret that clients have gotten much tougher in demanding proof of the purported value of technology services and solutions. Buyers' number one concern, according to ITSMA research, is that providers deliver on their promises.

But demonstrating ROI, especially for complex services and solutions for which every situation is different, is no simple task. From ITSMA's perspective, companies making ROI claims to clients need to organize their efforts around four principles:

• Be realistic. Clients are skeptical and on the lookout for exaggerated claims. Sharing a range of what your clients have achieved is more credible than highlighting your best-case scenario. Don't pretend that every client has achieved all-star results.
• Be specific. Clients want specific details about ROI claims: who achieved what, in what time frame, with what costs factored in, and so on. Just giving an overall number doesn't tell the story clients want to hear. Give them the details and the whole story.
• Be relevant. Different types of executives and managers are interested in different types of metrics. Factors such as increased revenue and profits are generally most important for CEOs and business managers. Other metrics, such as productivity gains, increases in user satisfaction, and decreases in system downtime, will be more relevant to CIOs and operational heads.
• Be fanatical about measurement. Having extensive real-world client data allows you to share credible benchmarks with individual clients. Developing systems to track your clients' performance may require substantial investment. However, it will pay off with credible data that allows you not only to create more compelling sales and marketing messages, but also to refine your own offers and capabilities.

Cisco Systems' approach to ROI tools provides a good example of how to use the tools effectively. Cisco's Customer Advocacy division has developed a series of tools tied to specific services offers, and marketing and sales teams are now using them as a key component of their "value selling" process.

For example, Cisco sales representatives can use an ROI tool to evaluate the potential ROI of a SmartNet support contract compared with the likely costs of separate time-and-materials engagements for a prospective client's network. Cisco has developed similar tools to help validate the ROI with higher-value services, such as network design and high-availability solutions. The tools are designed to quantify opportunity costs, cost savings, and revenue improvements for individual clients.

"The ROI tools have to have meaning to the customer," says Lauren Ventura, director of marketing services at Cisco. "With tight budgets, all of our customers need to see the value [of Cisco solutions]."

Ratan Agarwal, business development manager at Cisco, created the ROI methodology specifically to complement the value-based sales strategy. "We have leveraged the tool with a value selling approach that presents the information based on customer-specific experience. Together, the tools and approach help present the true business value of what we're delivering."

Several aspects of Cisco's ROI initiative deserve notice:

• Extensive collection of customer data to provide credible, real-world benchmarks that can be used with individual prospects
• Incorporation of ROI tools in every proposal
• Use of ROI tools early in the sales cycle to help shift discussions toward client gaps, needs, and opportunities
• Substantial investment in training and support for the sales force to ensure sales force competency in using the tools
• Continued use of ROI tools during the services delivery cycle to assess how ROI goals are being met

Presented effectively, ROI conversations can inspire exactly the sort of consultative dialogues that we are all striving to create. ROI tools alone won't make the sale. But they can add a great deal of credibility to your claims if they are developed with careful attention to the four principles outlined above.

—Dave Munn, dmunn@itsma.com

How are you demonstrating ROI with your offers to prospects and clients?

Research Desk

Building a Framework for Online Marketing Success (New Update)

Marketers often explain the limitations in their online marketing programs by citing resource constraints, but many organizations also suffer from narrow and piecemeal strategies. They focus only on one or two types of activities or audiences, forgoing the great potential of broader-based programs. No matter the level of resources at a company's disposal, it is difficult to take full advantage of the Web and other online tools without a comprehensive strategy.

Applying limited resources to virtually limitless possibilities represents a classic challenge of strategy and planning. Building a Framework for Online Marketing Success, a new ITSMA Update, presents four strategic guidelines to help marketers evaluate and refine online marketing objectives and priorities:

• Online goals. Creating a balanced approach to online marketing strategy.
• Online constituencies. Broadening online activities to engage all relevant stakeholders.
• Online relationships. Applying online tools to the entire relationship life cycle.
• Online processes. Developing online initiatives to support a comprehensive marketing function.
  

Each guideline provides a different lens through which to evaluate existing and potential online marketing activities. Together, the four guidelines address most of the issues that marketers confront in creating an effective framework for online marketing strategy.

Building a Framework for Online Marketing Success is a membership deliverable. It is available free to all ITSMA members and for sale to nonmembers via the ITSMA Website. For more information or to download or purchase this report, visit http://www.itsma.com/Research/abstracts/u0037.htm.

Brand Awareness and Market Positioning: New 2002 Multiclient Studies—Sign Up Now!

Competitors in fast-changing markets need to play close attention to the awareness, knowledge, and favorability of their own and key competitors' brands. As multiclient studies, ITSMA's Brand Awareness and Marketing Positioning Studies provide sponsoring firms with independent and affordable data based on extensive surveys with senior decision makers in target markets. ITSMA's expertise and years of experience in conducting brand studies has helped leading firms such as Accenture, Cisco, EDS, Hewlett-Packard, IBM, Oracle, and SAP monitor the competitive landscape and guide branding and positioning strategies.

Four new studies, covering CRM services, network and telecom services, storage solutions, and security solutions, are now open for sponsorship participation. Study sponsors are able to influence the research design as well as obtain customized reports and briefings. The resulting data and analysis help managers improve marketing planning, shape market perceptions, and track the effectiveness of existing programs.

For more information or to sign up as a sponsor, view the detailed study prospectuses on the ITSMA Website:

• Customer Relationship Management (CRM) Solutions:
  http://www.itsma.com/research/prospectus/mk0281_crm02.htm
• Network and Telecom Services—Service Provider Market:
  http://www.itsma.com/research/prospectus/mk0276_nwt02.htm
• Storage Solutions:
  http://www.itsma.com/research/prospectus/mk0282_strg02.htm
• Security Solutions:
  http://www.itsma.com/research/prospectus/mk0286_sec02.htm
  

DataFile: 2002 Services Marketing Budget Allocations (Member Survey Results)

A recent ITSMA member survey collected data on such budget issues as percentage of services revenue devoted to marketing, allocation of spending to field marketing programs, allocation to internal marketing, and allocation of the marketing communications budget, among others.

The following chart highlights the allocation of resources in 2002 to various categories of marketing activity. All categories include personnel and program expenditures.

A presentation of the complete findings is available to all ITSMA members that participate in the survey. Members interested in participating and receiving the full data set should contact Adnelly Reyes at +1-781-862-8500, ext. 14, or areyes@itsma.com.

TechPoll: Tech Spending Outlook Remains Modest

ITSMA has arranged with CIO Magazine to include highlights of the CIO Magazine TechPoll in the ITSMA E-ZINE. This monthly survey provides an assessment of technology growth trends from a broad cross-section of CIOs. Please let us know whether or not you're interested in seeing similar highlights in future issues of the E-ZINE.

—Rob Leavitt

• During February 2002, the CIO Magazine TechPoll projected that IT budgets will grow 3.2% over the next 12 months, down from January's 3.8% and down from 11.0% last February.

• The Tech Future Growth Index, which projects IT activity over the next 12 months, was 1.2, compared with 1.4 in January. (The index multiplies the projected growth rate of IT budgets by the average percentage of respondents saying they plan to increase their spending in eight unique categories.) This marks a new low since the poll was initiated in August 2000. The index stood at 6.0% in February 2001, and 3.1% in August 2001.

• Weak profits were cited by 38.7% of respondents as the primary factor affecting IT spending plans. Another 31.0% cited tight financial conditions and 20.7% said spending might be weak because there was already sufficient IT capacity.

• Security software is the strongest sector, with 58.2% of panelists expecting to increase spending on security systems over the next 12 months and only 6.1% planning to decrease spending.

More information: http://www.cio.com/info/releases/030102_techpoll.pdf.

EuroNotes: News and Views from ITSMA Europe

Attracting the Best and Brightest

Technology marketing managers in Europe remain concerned about the long-term prospects of attracting the best and the brightest into technology services marketing, even as immediate hiring demands have eased with the slowdown.

Year after year, services marketing veterans watch with dismay as top marketing graduates are attracted by consumer brand management roles which they believe offer a more glamorous and fulfilling career.

Not surprisingly, services marketers believe services marketing is more rewarding, in large part because they believe it is more challenging in a number of ways. For example, services brands rely more on employee and partner performance than on products, making the scope of services marketing responsibilities ever wider and more varied. Managing expectations and perceptions of services quality, as perceived by individual clients, often requires services marketers to understand and get involved with the entire delivery process.

Several of Europe's leading technology services marketers have recommendations on how to improve the attractiveness of the profession.

Gordon Moultrie, vice president of marketing for EMEA at EDS, wants the education process to start much earlier. "When students think about marketing as a possible career, consumer brands are top of mind to them. We need to start there by working with career guidance staff and education boards to show the challenges, excitement, and rewards that a career in services and solutions marketing can offer."

Sara Sheppard, group marketing manager at Microsoft U.K., believes that ITSMA and its members should work with broad-based marketing organisations like the Chartered Institute of Marketing (CIM) to increase the value of professional qualifications for services marketing. "We must get to the point where recruitment for any middle or senior management role has the CIM diploma or equivalent qualification as a candidate prerequisite."

Laurie Young, global marketing partner for the corporate finance and recovery division at PricewaterhouseCoopers, agrees with Sheppard. Young, a CIM board member, believes that "there is a role for ITSMA to work in partnership with other organisations that offer broad professional marketing qualifications where ITSMA offers the specific techniques and examples to hone skills in this ever-changing area of technology services."

—Bev Burgess, info@itsma.com

ITSMA's Services Marketing Professional Program provides a six-month, MBA-level, on-the-job certificate program focused specifically on key services marketing issues and challenges. ITSMA is also partnering with executive education centres such as Babson College in the United States and Cranfield School of Management in the United Kingdom to provide MBA-standard and accredited training in services marketing. If you have comments or suggestions about how best to promote the services marketing profession in Europe, contact Bev Burgess at +44 (0) 1892 523060 or info@itsma.com.

For more information on the Services Marketing Professional Program, visit http://www.itsma.com/education/smpp_about.htm.

How to Win and Keep Business (special from Enterprise Europa)

The market for selling IT services has never been tougher. Competition has become more intense at the same time that end-users are cutting back on suppliers and overall IT spending. Focusing on existing customers is top priority for many IT services providers. But does it have to be at the expense of winning new business?

Read the complete article (0.7Mb PDF)

ITSMA Europe is now able to provide access to selected articles from Enterprise Europa, the only pan-European, subscription newsletter covering IT professional services and high-end software vendors in Europe. ITSMA E-ZINE subscribers are also eligible for a £100 discount (about 20%) on subscriptions. Visit www.iteuropa.com or contact Joanna Whale at joanna.whale@iteuropa.com or +44 (0) 1206 224400 for details.

Upcoming Events: North America

March 13-14 Workshop: Creating Market-Focused Growth with Dr. Lynn Phillips (San Francisco, CA)
Lynn Phillips is back with a perennial ITSMA favorite. "Creating Market-Focused Growth" is designed to help marketers deal with many of their biggest challenges, including defining and delivering better value to current customers, attracting new customers with superior value offerings, and communicating value to customers more effectively and efficiently.

For more information or to register online, visit http://www.itsma.com/events/event_desc/e03140200.htm or contact Lore Griffith at +1-781-862-8500, ext. 19, or lgriffith@itsma.com.

March 19 Online Briefing: Metric Systems That Work: Digital Dashboards and Real-Time Reporting (free to members)—Note Time Change: 11:00-12:00 EST
Does executive management really appreciate the value of marketing? Join ITSMA's Steve Hurley to discuss new ways of packaging your marketing metrics for executive action. Steve will present a detailed strategy to align marketing with corporate priorities, measure the value of your marketing activities, and report to executives the data they need.

For more information or to register online, visit http://www.itsma.com/events/event_desc/E03190200.htm or contact Lore Griffith at +1-781-862-8500, ext. 19, or lgriffith@itsma.com.

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March 25-27 Seminar: New Frontiers in Service Excellence (Babson College)
Looking for a crash course in service excellence? Babson's executive seminar teaches professionals innovative ways to create and sustain a high performing service organization, with special attention to services marketing, customer relationship management, and the quality of delivery methods. For more information, visit http://www2.babson.edu/babson/babsonseep.nsf/Public/execopenservice or contact Babson at +1-781-239-4354 or exec@babson.edu.

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Upcoming Events: Europe

March 12 Online Briefing: Offer Rationalisation: Making Sense of an Offer Portfolio (free to European members)—15:00-16:00 GMT
Rationalising portfolios to maximise financial performance has always been a balancing act between internal dynamics and client wants and needs. Join Terry Hannington, ITSMA managing director for Europe, for a review of the key issues and industry best practices surrounding the internal and external rollout of revitalised offers.

For more information or to register online, visit http://www.itsma.com/Events/event_desc/E03120200.htm or contact ITSMA Europe at +44 (0) 1494 616027 or info@itsma.com.

April 22-23 Workshop: Managing Brands and Building Reputations (Beaconsfield, U.K.)
Strong brands have never been more important or more vulnerable than in today's era of transparency and hypercompetition. "Managing Brands and Building Reputations" highlights practical knowledge and techniques to launch and relaunch services brands, embed the brand in company values and actions, and evaluate brand strengths and weaknesses.

For more information or to register online, visit http://www.itsma.com/Events/event_desc/E04220200.htm or contact ITSMA Europe at +44 (0) 1494 616027 or info@itsma.com.

Complete 2002 Events Calendar: http://www.itsma.com/aspfiles/Events/calendar.asp

Toolbox: Getting to Know Your Clients

Each month ITSMA highlights a new idea, application, or other type of tool that marketers can use immediately to strengthen their programs and organizations.

If you're going to be successful at marketing and selling complex services and solutions you need to know what is strategically important to your clients. You've got to do your homework. You've got to invest the time in studying your clients' industries, business issues, organizations, and individual decision makers and influencers.

It's not rocket science, but it does take time, energy, and often creativity. ITSMA's Getting to Know Your Clients provides all marketing and sales professionals with a handy checklist to guide this critical client research.

Visit http://www.itsma.com/research/toolkit_free/ms_checklist.htm to view and download the tool.

Visit http://www.itsma.com/research/toolkit_free/mrkt_audit.htm to learn about ITSMA's Marketing Performance Audit, a new benefit for members that evaluates performance in five key areas and measures results against against high-performance services marketing organizations.

View more ITSMA Tools.

Briefly Quoted: Services Marketing Lessons from the Olympic Village

"The events were simply amazing. It was also awesome to just be there and see the enormous number of people from all over the world. I say hats off to Salt Lake City for being an excellent host. They really dealt with the crowds and security in a way that amazed me. From a services marketing perspective, I think they did an excellent job in setting expectations and then delivering above them. It would make an excellent case study in how to manage the marketing and rollout of large public events. Of course, when I told this to my wife, she just rolled her eyes and told me to shut up and get on vacation!"

—Chris Lake, manager, Integrated Information Systems

ITSMA in the News

• Interview: David C. Munn (Internet World)
• Pop Quiz: Name One CRM Services Firm (SearchCRM.com)
• CRM Services Brands Suffer From Obscurity (InfoWorld)
• CRM Brand Awareness Study: Many Unaware (Technology Marketing)

View more ITSMA in the News

Do you have a services marketing question?
Visit Ask ITSMA to access our experience, insight, and research results.

(c) Copyright 2002, ITSMA

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About ITSMA
ITSMA specializes in helping companies market and sell services and solutions more effectively. As a membership organization, we provide research, consulting, and training to the world's leading technology, communications, and professional services providers to generate increased demand, strengthen customer relationships, and improve brand differentiation. ITSMA is based near Boston, and has offices in London and Tokyo. Learn more at www.itsma.com.