Common Challenges

2 October 2001—Following our successful inaugural forum in June, ITSMA Europe has sharpened its agenda by reaching out widely to European marketers for insights into current trends, fresh challenges, and growing opportunities for IT services marketing organisations. The economic downturn has certainly affected IT services firms in Europe but perhaps not as much as in North America. It is still too early to measure the impact of the horrendous events of September 11 on business in Europe.

Recent discussions have highlighted several common issues:

• Reduced services marketing budgets
• Rebranding following mergers or acquisitions
• Refocusing existing services portfolios
• Bringing new services to market

These issues are all too often compounded by a shortfall in experienced services marketing personnel.

Rebranding will continue to be a pressing issue within the telecoms sector. France Telecom is bidding for NTL's broadcast transmission arm in the United Kingdom; British Telecommunications is publishing prospectuses for the de-merger of mmO2, its wireless operations; and Vodafone has confirmed plans to take control of Japan's third largest telecommunications operator, Japan Telecom.

Telecoms firms are also immersed in refocusing activities. Openworld, for example, the Internet division of British Telecommunications, has largely abandoned providing online content and will concentrate instead on offering simple access services. This sort of refocusing presents marketers with a set of fresh challenges.

In the software sector, the chairman of Cedar, a firm that provides customer relationship management (CRM) solutions, noted recently that he was seeing a growing customer preference for managed services rather than the outright licensing of software. Like Cedar, many IT organisations in Europe are grappling with the move from product to services and to solutions marketing. The different mindset, organisation, and resources required to make this shift can be a considerable mountain for the entire company to climb, along with the marketing department itself.

A critical question: As companies refocus and redirect resources—budgets, people, and time—in the current environment, are they achieving the correct balance in marketing globally and locally that will contribute most to the success of pan-European IT services organisations?

ITSMA Europe has met recently with firms that come down on quite different points along this global/local spectrum. One large telecoms firm, for example, places almost total emphasis on corporate commitments and the longevity of relationships within each individual country as the deciding factors for its success. Global marketing pulls ideas for new services development from the local offices and then works with other local offices to launch them in other countries.

In contrast, a large software firm we work with maintains a virtual marketing team across Europe and relies mostly on building its global marketing strategy and brand, even though its individual country offices are moving at different speeds to shift from product to services and solutions marketing.

—Melanie Oakley, info@itsma.com, and Bev Burgess, info@itsma.com

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.