ITSMA E-ZINE	May 2004

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Editor's Notebook: Subservient Chickens?

I bet this headline got your attention! I stumbled across the phrase on the Harvard Business School Website, no less, but it comes courtesy of Burger King. The number two hamburger chain has a new branding campaign that just might suggest a few lessons for us in the technology and professional services sectors. Bringing back the famous 1970s slogan "Have It Your Way," Burger King's campaign focuses on the value of customized service with an increasingly cynical and detached audience.

The particulars of BK's campaign, which includes a rather disturbing Web effort featuring "subservient chickens," have little to do with our markets. But the efforts to get more personal with customers, test new approaches to communications, and improve the customer experience absolutely ring true.

Debate has long reigned about the differences between consumer and business-to-business marketing, and the skills that consumer specialists can bring to the B-to-B table. I have no doubt that the differences are significant, but customization, creativity, and customer experience should lie at the heart of any marketing program. In that context, the Burger King effort is worth a look. Just don't let your kids watch the chickens.

—Rob Leavitt

What's Hot: Go-to-Market Strategies: Eight Steps to Success

New offerings have always driven growth in the technology business, but bringing them successfully to market today has become both more important and more difficult. Competition is more intense, existing offers become commodities more quickly, and buyers are more skeptical of the return on technology investment. As a result, marketers are under tremendous pressure to increase their hit rate when they launch new services and solutions.

The first response to the added pressure is often to review the process. Many large tech firms are now working hard to improve the go-to-market process with a goal of creating a more consistent, systematic, and efficient approach. Rather than rely on ad hoc initiatives from anywhere in the organization, a good process can create discipline for the entire development, launch, and management cycle.

But process in itself is not enough. It too often breaks down, fails to provide the necessary support, or lets through too many misguided new offers.

To improve the chances of go-to-market success, marketers should center a rigorous process around eight practical challenges:

1. Clarify the opportunity. Identifying and validating the opportunity typically constitute the first phase in any go-to-market process, but marketers often skip through too quickly. Is the opportunity truly significant—and achievable? Dig deeper into potential market segments, initial top prospects for the new offer, and competitive positioning.
2. Define a point of view. Demonstrating expertise and a clear position on business and technology issues is essential to gaining initial attention from market influencers. The most sophisticated buyers are looking for innovative answers to business problems; they'll seek you out if you take a compelling stand on an issue of real importance.
3. Sharpen value propositions. The more defined the target, the easier it is to craft a compelling value proposition. Take time to customize value propositions for every audience. What's in the new offer for the sales force? What about the delivery organization? Channel partners? Finance? Have you developed specific enough propositions for key market segments and individual accounts?
4. Engage the entire organization. Is everyone pulling in the same direction on the new offer? Cross-functional and multiregional teams to lead the process can help, as can carefully recruited champions across the organization. You need to condition the organization to support the go-to-market process with a combination of carrots and sticks to sustain support.
5. Develop highly focused and creative campaigns. Getting and keeping attention for new offers requires balancing between broadcast initiatives that build awareness and buzz and narrowcast efforts that zero in on the key concerns of specific markets and prospects. Buyer reliance on peers, word of mouth, and third-party experts makes indirect communication as important as direct. The din of competition puts a premium on innovative approaches to getting the word out.
6. Build on initial success. Buyers often demand "Show me the value," and the best way to prove value is through relevant success stories that that speak directly to that customer's issues. Initial successes become the building blocks for an ongoing campaign. Documenting value delivered, therefore, becomes one of the most important jobs for marketing, along with maintaining a reference system to support easy access to those success stories.
7. Provide the right sales support. The traditional tension between sales and marketing is often exacerbated by new offer launches. When offers fizzle, marketing is often blamed for inadequate support. Minimize that excuse by excelling at the most important types of sales support: business issue information; targeted value propositions, business value justification tools, proposal templates, and references and testimonials.
8. Constantly measure. Make the measurement commitment to ensure you know what is working and what needs improvement. Define the most important metrics before you launch, and create accountability around data collection and analysis. Consider short- and longer-term objectives, such as brand development and improved sales productivity, as well as revenue and profit. Communicate results internally and adjust programs accordingly.

The increased focus on improving the go-to-market process is a welcome one. Too many firms still rely on a build-it-and-they-will-come approach to new services and solutions. Absent a practical reality check, though, any new process runs the risk of ignoring some of the most difficult obstacles to success.

What are your biggest go-to-market challenges? Have you developed a better route to market?

—Rob Leavitt

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Features

Lost in Translation: Mixed Messages on Multilingual Marketing

The marketing communications challenge for global companies is enormous. Not only must marketers conduct a delicate balancing act between centralized strategy and localized implementation, they also need to determine which languages to use for marketing materials and initiatives. And they have to communicate effectively across multiple cultures and languages simply to make those decisions!

Even the most experienced global companies have yet to master the multilingual communications challenge, according to a recent ITSMA survey of member firms. In fact, discussions with some of the largest technology and consulting firms suggest that global companies differ greatly in the degree to which they even have a structured approach to multilingual marketing. Current translation practices range from highly structured to essentially ad hoc, with similar variance in the types of materials marketers actually translate into different languages.

Three patterns do emerge from the multilingual muddle.

1. Companies with a product heritage tend to have more formalized processes for translation than pure professional services firms. This results at least in part from product companies' historical need to translate manuals, warranties, and other essential product-related information. Further, because product companies often sell operational services to technology managers, they often work with customers who do not speak English, or at least do not want to conduct business in English, the unofficial global standard.

As a result, large technology companies often have formal global processes for developing content that facilitates translations and for managing the translations themselves. As one product and services company executive explained, "There are guidelines on how every piece of marketing material is developed, including length and use of humor and local colloquialisms."

On the other hand, professional services firms, with their more decentralized cultures, tend to take a more ad hoc approach to multilingual marketing and often translate fewer materials. The customer base of senior executives for many professional services firms also puts less pressure on multilingual marketing because more senior executives worldwide are comfortable functioning in English. According to a marketing communications executive at one large consulting firm, "Corporate provides the messaging, branding, Web templates, palette, etc. If a country wants to reproduce corporate or companywide collateral in their native language, they are responsible for doing so, including all costs." Of course, this laissez faire approach does raise a few questions about global quality control and consistency.

2. Most global companies look to regional coordinators to manage the translation process, however formal it may be. Regional managers often hold translation budgets and work with country managers to determine which materials need to be translated. Managing translation at the regional level allows a useful balance between global demands for consistency and local perspective on priorities and adaptation. As one product company marketing manager explained, "A [regional] focal point for all requests enables us to see the big picture, which is key to avoid duplications and gain efficiencies with translation costs—plus the local perspective is required to understand what the needs are."

3. Global marketers typically prioritize translation of customer-facing documents. Internal communications documents such as memorandums, CEO letters, and corporate newsletters are rarely translated into local languages. The assumption is that English is the global business language and most employees are able to communicate in English. Companies prefer to reserve limited translation funds for external content, such as annual reports, Websites, press releases, and other marketing collateral.

Notable exceptions to the general rule include Japan and China. Several marketing executives with whom ITSMA spoke noted that more internal documents are typically translated into Japanese and Chinese than into other languages, reflecting a greater concern about multilingual understanding across those languages and, especially in the case of China, that fewer business managers speak English. As an aside, one marketer noted, "We like to [translate into Chinese] to appease the Chinese government."

Is there a right answer to the multilingual challenge? Probably not. More translation of materials might help ensure effective marketing across countries and cultures. But the risks of ideas getting lost in translation are also significant if processes are not clearly developed—or if processes are overly rigid. As one executive noted, even the largest, most successful global companies are "continually grappling" with the multilingual challenges.

—Anna Whiting

Brand Development in Storage Services: Targeting Investment for Maximum Return

Will technology buyers ever be satisfied? Even with technology spending on the rise, the gap between buyer expectations and satisfaction remains worryingly large.

Take the storage market, for example. Providers of storage hardware, software, and services have pulled through the downturn and begun to reap the benefits of rising spending on storage. The sheer growth in data, along with issues such as disaster preparedness, higher availability requirements, and data security, are driving business buyers to open their wallets to expand capacity and upgrade systems.

Yet buyer perceptions of the leading storage services vendors are mixed at best, according to ITSMA's latest study of brand and competitive positioning for storage services. Most important, buyers do not give high marks to vendor performance in meeting their top concerns.

Certainly some firms score well. EMC, IBM Global Services, and Hewlett-Packard maintain a stronghold in the minds of buyers from large enterprises across multiple industry groups, according to the new ITSMA report, Preferences and Priorities for Storage Services: 2004 Brand Tracking Study. The big three gain positive ratings from buyers for brand awareness, familiarity, and general favorability. Sun Microsystems, Dell, Network Appliance, Hitachi Data Systems, and VERITAS also receive good marks in certain areas.

On the other hand, buyers are not exactly wowed by industry performance. The top three attributes that buyers look for in storage services providers are:

• Commitment to customer satisfaction
• Follow-through on promises
• Excellent technical support

On a five-point scale, in which five equals very important, these attributes each garner a 4.7 rating. Although several firms score well on one or more of these attributes, the overall market perception is well below the standard for real satisfaction. Indeed, the average ratings for a host of important attributes are well below 4 on a five-point scale. The best ratings hover around 4, and even those are below the comfort level in today's hypercompetitive market.

ITSMA's Brand Investment Matrix plots buyer perceptions of industry performance for various attributes against the relative importance of those attributes.

Brand Investment Matrix: Services Attribute Importance vs. Market Attribute Assessment

In viewing the Brand Investment Matrix, consider the following:

• The Promote quadrant at the top right includes those attributes that buyers consider most important and for which perceptions of vendor performance are relatively positive. These are the attributes storage services firms should lead with in marketing and brand development initiatives.
  
  *Note: Using average performance as the dividing line, the matrix provides a generous assessment of what firms can comfortably promote. Using the "best in class" standard would change the picture dramatically. Certainly, firms should push toward the level of best in class, and hopefully beyond.

• The Build and Emphasize quadrant represents attributes that are also considered important and yet performance of which is viewed as less effective. Marketers need to improve performance in these areas or risk serious brand damage.

• The Monitor quadrant shows those attributes for which performance is seen as weak, but relatively unimportant. Marketers need to track those attributes in case buyer priorities change, but they do not need to invest in improvements in the near term.

• The Maintain quadrant highlights the attributes for which performance is deemed relatively strong but also less important. Marketers should maintain performance in these areas, but new investments are less useful.

Storage services firms, like most technology firms, are still fighting an uphill battle with potential customers, notwithstanding an improved spending environment. Focusing marketing investments on those areas that buyers care about most is critical to building a stronger brand and reputation, which in turn creates the necessary credibility to succeed.

—Rob Leavitt

ITSMA's new report, Preferences and Priorities for Storage Services: 2004 Brand Tracking Study, provides a detailed analysis of how IT executives from large enterprises and government agencies assess leading providers of storage services and the market as a whole. The report includes data on brand awareness, favorability, market positioning, preferred attributes, and market drivers. The report is available for purchase at member and nonmember prices. For more information, visit: http://www.itsma.com/research/abstracts/bst002.htm.

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Research Desk

Tech Spending Outlook Eases But Remains Solid (Tech Poll)

CIO Magazine's April Tech Poll showed solid growth projections for IT spending for the fourth month in a row, although the outlook did ease off a bit from the previous quarter. In another sign of greater willingness to spend, CIOs report the highest increases in compensation for IT staffers in more than a year.

Key findings include:

• Overall, CIOs project spending increases of 6.6% over the next 12 months, down a bit from the 7.3% projection in March but still higher than any projection made during 2003.
• IT compensation costs rose an average of 4.4% during the past 12 months, up from 3.7% in March and 2.2% a year ago. This is higher than any report in the last 15 months.
• When asked about spending in eight specific IT categories, more than 45% of CIOs said they plan to increase spending, up from 42% in March. Only 13.2% plan to decrease spending.
• The percentage of CIOs planning increased spending on infrastructure software jumped to 39.5% in April from 33.6% in March; the increase, according to CIO Magazine publisher Gary Beach, indicates that "CIOs are finally planning to address brittle network infrastructures and the aging software applications that have been in place for years."
• Almost one-third of CIOs plan to increase spending on outsourced IT services, up from 28% in March. Some 44.1% plan no change in spending in this category.

CIO Magazine's Tech Poll provides a monthly assessment of technology buying trends from a broad cross-section of chief information officers (CIOs), mostly from North America. The latest survey, conducted April 8-15, 2004, included 288 respondents. Large firms with more than 5,000 employees represent 16% of the results. The respondents represent a wide range of industries, including technology services, manufacturing, finance, state and local government, health care, and wholesale and retail distribution.

For complete survey results, visit http://www.cio.com/techpoll.

Sponsorship Opportunities: Sales Practices and Software Brand Studies

2004 Sales Practices Study: Best Practices and Benchmarks from IT Services Leaders
(No charge for ITSMA members who sign up by June 15)

• A new buyer reality has forced IT services leaders to rethink their sales strategies, organizations, and processes. ITSMA’s upcoming 2004 Sales Practices Study: Best Practices and Benchmarks from IT Services Leaders, will explore how companies are meeting the sales challenge in response to changing buyer behavior. ITSMA's unique study will highlight benchmark data, case study examples, and best practices specifically for selling IT services and solutions.
• ITSMA's Sales Practices Study is a give-to-get benefit of corporate membership. Members who sign up by June 15 and provide data for the study receive a full report, customized briefing, and more at no charge. Members who sign up after June 15 and nonmembers can also participate for a fee.
• An optional add-on to the study will enable participants to survey their own sales force on support, tools, and training for services and solutions and compare their own sales force’s responses with those from other companies and from the industry as a whole.

  Learn more about sponsorship: http://www.itsma.com/research/prospectus/mk0463_sp04.htm

2004 Brand Tracking Study: Customer Priorities, Competitive Positioning, and Brand Preferences for Software Applications and Services

• The reinvention of the business software market requires vendors, integrators, and consultants to rethink the way they develop offers and work with customers. ITSMA's new multiclient Brand Tracking Study: Customer Priorities, Competitive Positioning, and Brand Preferences for Software Applications and Services, will provide critical insight into the emerging buying reality for the market generally and for specific applications.
• The study, based on interviews with 500 senior decision makers at large and medium-sized companies, government agencies, and other large institutions, will give sponsoring companies detailed data, analysis, and recommendations surrounding the buying process, competitive positioning across different market segments, and the most effective marketing investments.

  Learn more about sponsorship: http://www.itsma.com/research/prospectus/mk0448_sw04.htm.

EuroNotes: The Rise of Account-Based Marketing: Four Roads to Success

However one describes it—one-to-one marketing, relationship marketing, or account-based marketing—the practice of treating single accounts as unique markets and preparing targeted programs for them is growing rapidly among leading technology firms. New ITSMA research indicates that the roughly 17% of marketing resources dedicated to account-based marketing in 2003 could double by 2005. For companies driven by tough market conditions, the shift to relationship versus transactional selling, and the need to capture and keep the most profitable clients, account-based marketing appears to offer companies a better return on marketing investment than more broad-based approaches.

By combining the best of strategic account management and marketing thinking, account-based marketing also unites marketing and sales more closely than ever before. As marketing focuses on share of influence in single accounts, and sales emphasizes share of revenue, the combination results in a powerfully targeted approach to clients that goes much further than industry or sector marketing ever could.

So, how do we get from here to there?

Read the full story

More EuroNotes

Marketing Toolbox: Ten Tips for Account-Based Marketing

Account-based marketing is relatively new on the IT services scene, but its many potential benefits have inspired a significant interest across the industry. Focusing marketing attention and resources on individual accounts and working more closely with account teams have become priorities at numerous firms.

Because accounts have traditionally been "owned" by sales, account-based marketing raises a number of challenges for marketers. Developing an effective account-based marketing program requires careful attention to internal organizational concerns as much as external customer concerns.

ITSMA's new tool, Ten Tips for Account-Based Marketing, provides guidance on 10 essential challenges to building an effective account-based marketing program.

Take me to the Tool

More Marketing Tools (membership online access required)

Upcoming Events

Last Call for Registration
Marketing-Led Growth: Building a New Vision—ITSMA's 2004 Chief Marketers' Conference
May 11-12 (Washington, DC)
http://www.itsma.com/Events/event_desc/04MC05N08.htm

ITSMA's fourth annual Chief Marketers' Conference will bring together top technology and services marketing executives to explore the most urgent leadership challenges. Conference topics include marketing to the new buyer reality, aligning the whole company around new visions and objectives, moving to a solutions orientation, and staking out a more defensible market position.

Growing Your Solutions Business
June 23-24 Workshop (Babson College, Wellesley, MA)
http://www.itsma.com/Events/event_desc/04WS06N10.htm

Technology and professional services firms have moved aggressively over the last few years to become solutions providers. Yet the transition is proving difficult as firms realize that change is required at virtually every level of the organization. This workshop provides participants with tools, models, and best-practice examples to support their efforts in seven key elements of the solutions transformation.

Marketing's Role in Strategy, Planning, and Intelligence
May 25 Online Briefing (No charge for members)
http://www.itsma.com/Events/event_desc/04OB05N09.htm

Creating Winning Partnerships and Alliances
June 1 Services Marketing Roundtable (Hatfield, UK; no charge for Europe members)
http://www.itsma.com/events/event_desc/04RT06E15.htm

Managing Partner and Channel Dynamics: An Updated Look at Best Practices
June 15 Online Briefing (No charge for Europe members)
http://www.itsma.com/Events/event_desc/04OB06E06.htm

Complete 2004 Events Calendar

Event Sponsorship Opportunities

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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.