ITSMA In the News: Reprint

SERVICE MARKETING: 4 THAT GET IT

Yes, marketing services can be a challenge. Here's how four companies successfully used clever, effective campaigns to attract new customers.

Unlike a computer, a hamburger, or a car, a service can be a tricky thing to promote; obviously, glossy product shots just won't cut it. Service organizations must find another way to convey their service strengths, and well-plotted, intelligently designed marketing campaigns can be highly effective tools.

Each year, ITSMA, the Information Technology Services Marketing Association (www.itsma.com) and its panel of industry experts look at new services marketing campaigns submitted by technology companies. In 2000, they chose four companies as the winners of the ITSMA Services Marketing Excellence award: marchFIRST, Hewlett-Packard, Oracle, and IBM.

New this time around was the Building the Services Brand award. "Two or three years ago, building a service brand wasn't a big issue," says ITSMA president David Munn. "Our focus then was on tactical marketing strategies." However, with the ever-changing nature of eBusiness forcing companies to change their names and product/service offerings, building a strong brand that can be sustained over time has become more critical. "Companies have to use their advertising, marketing materials, tag lines, colors, logos, and letterhead to effectively communicate who they are and what they do," Munn explains.

Customer Support Management congratulates this year's ITSMA award recipients!

eMarketing Excellence

IBM Global Services, Armonk, NY The Challenge: In early 1999, IBM Global Services was conducting an aggressive eBusiness advertising campaign; but it wasn't backed up by the IBM website, which contained brochureware from 12 different IBM departments. The website focused on IBM's offerings and the company's structure, rather than on customers' problems. And the sales team typically did not sell the prepackaged offerings described on the web, because 80 percent or more of the work was custom.

The Solution: What was needed was an eBusiness Services site that would a) help customers decide whether or not they should pursue eBusiness, and b) position IBM as a credible and reliable partner. Using IBM's Websphere Studio, IBM teams created a soft-sell, educational site, www.ibm.com/services/resources. On the site, white papers, case studies, executive briefs, and news articles are organized by industry, under seven levels of need. The content is updated twice a week. (Only one of the levels is IBM product-oriented, at the request of focus group members.) As visitors progress along the seven levels, they are increasingly encouraged to call an IBM representative, and are directed to a "Talk to Us" form.

"Most of our competitors' sites focus on exuding a quiet confidence," says Rob Rohrer, manager of interactive marketing at IBM Global Services. "These sites tend to have a small amount of information; they're simply hoping you'll call them. But our tack was, we're going to demonstrate to you that we know what we're talking about and give you lots of information. Once you've learned all you need to know, you're going to want to call us." Cookies provide IBM with a unique ID for each visitor and data regarding which levels they've visited, what content they've viewed, and how many times they've returned. "For the content team this is a gold mine, because we learn which content people like to view, and we don't waste our time on documents that don't appeal to users," Rohrer says.

The Results: The site received 150,000 visitors from May through August 2000. As of mid-November, 451 people had filled out a "Talk to Us" form, and 37 percent (167) of those were validated leads. "That's about two to three times the norm," Rohrer says. "Of those 167 leads, 29 have become qualified opportunities. From those, we've identified potential revenue of more than $2.6 million and closed one deal worth $100,000."

What the Judges Said: "IBM's award was for eMarketing; that's a new category. Many companies are just starting to invest in online marketing. This category includes information and tools on the website, as well as using the website as a communications vehicle. IBM has a strong, integrated marketing communications model. They've done innovative things with their site to build customer awareness of what they do, and to collect customer data." "The website was well-written and easy-to-understand. It's a big plus to be able to tie web readership to sales leads." "IBM made excellent use of the web to educate, develop relationships, and sell."

What's Next: IBM plans to take the new website global, offering it in areas such as Europe and Asia/Pacific. The company is also working on more interactive relationship-building on the website. To accomplish this, says Rohrer, IBM will implement a device that allows visitors to communicate with IBM staff via the internet, and they may make more use of audio/video interactive tools.

New Services Innovator

Hewlett-Packard, Palo Alto, CA The Challenge: Hewlett-Packard identified an unmet need among eBusinesses - the need to eliminate website downtime. Research, in fact, turned up dramatic evidence of this void: According to Yankee Group, after a 22-hour outage at eBay in June 1999, eBay's stock dropped 18 percent, and it lost close to $5 million. Then, early in 2000, when Buy.com was down for four hours, that company recorded $2.45 million in lost revenue. Finally, the hacker attacks that temporarily disabled popular websites during the week of February 7, 2000, cost the industry as a whole $1.2 billion. The analyst firm Standish Group points out that companies lose $10,000 per minute during such eCommerce outages.

The Solution: In response to such critical need, HP developed a service that promised "uptime all the time." The company already offered minimal downtime on its Mission-Critical Server Suites. These products came with a guarantee of 99.95 percent uptime for HP-UX solutions and 99.9 percent uptime for Windows NT products. HP also provided a security assessment, an operational readiness assessment, and help in keeping the servers running.

For the new service offering, called the Remedies Alliance Program ("remedy" is a legal term that refers to making customers whole when they suffer losses), HP combined this mission-critical service with insurance offered through Interex (an independent HP user group based in Sunnyvale, CA) by Wurzler Underwriting Managers. Jeff Louie, marketing manager for Mission Critical Services recalls, "A team of us were doing scenario planning, hashing out the challenges people have in the marketplace today - one of which was: How do we protect customers against the vagaries of the internet and hackers? That led me to discussions with several insurance companies."

Wurzler offered insurance for top-line revenue (cash), where other insurance companies only insured against losses to net income. "But how many eCommerce companies are producing income?" Louie points out. "To my knowledge, there are two." Cash, on the other hand, is something even brand-new internet businesses have on hand. The insurance is available to any company that runs an eCommerce site on an HP Unix, Linux, or Microsoft server.

The Results: The press, industry analysts, and current/future customers have expressed interest in the program. With virtually no marketing (except for a single press release) HP has secured 22 magazine (e.g., Business Week, Computerworld, Information Week, Investor's Business Daily, USA Today) and two television interviews based on the new program. An estimated 30 percent of HP customers in the pipeline want to receive a higher amount of coverage to protect their companies' revenue. Wurzler Underwriters forecasts that it will write in excess of $200 million of coverage during this initial stage of the program, and a total of $375 million by the end of the first year.

What the Judges Said: "HP has a history of success in developing/launching new services; the new one is unique and innovative." "Brilliant concept and execution." "This program meets a key need in the internet area." "This service has identified a market opportunity and has had an impressive three-month timeline."

What's Next: Hewlett-Packard and its partners are in the process of increasing the amount of coverage possible from the original $1 million and $2 million, to $5 million and $10 million. They plan to cover specific new risks of doing business on the internet as those risks arise. "There are new exposures brought on by the internet every day," Louie says.

Improving Service Sales

Oracle Corp, Redwood Shores, CA The Challenge: Oracle is a $10.1 billion company, with $2.2 billion of that company revenue derived from consulting. Like IBM, Oracle's goal was to increase eBusiness consulting sales. But according to senior VP Valerie Borthwick, "The real challenge was, `How do we train our sales reps to have initial conversations with clients about eBusiness transformation?' Last year was a transition for us all, as we went through our account base and tried to figure out how to speak to executives about moving from traditional business to eBusiness."

The Solution: "We built a tool that allows the rep - through targeted questions and exercises - to guide the business manager through evaluating five key areas of his or her business," Borthwick says. This tool, which resides on Oracle's intranet and is called the e-Valuator, helps "ask" the questions, and then assesses how a company deals with its customers, procurement, the supply chain, enterprise management (including HR and financial), and technology infrastructure. "We assess the company's readiness against where they think they need to be in the marketplace," she says. "The e-Valuator also uses third-party data gathered by contracted Benchmarking Partners. We then come up with a gap analysis that helps the client understand where they are today, what they need in order to be differentiated, and where they are versus the market space leaders. If we pinpoint procurement as a prime area for improvement, for instance, we can target and focus our efforts there, and bring in procurement experts."

What happens after inquiry and evaluation? If a customer's interest is sufficiently piqued by the evaluation, says Borthwick, Oracle next offers a two-day executive workshop. "This helps the client move through brainstorming, and decide what their key areas of focus are going to be," she adds. "We take a comprehensive view of all the relationships important to the business, and determine how they can manage those relationships over the internet. We can determine if those relationships are providing some value, no value, or negative value. We then present solutions to improve the relationships." In short, Oracle's new consulting services take the customer through the changes they will need to make to become more eBusiness-savvy.

The Results: Since the e-Valuator was launched during a series of eBusiness conferences in September 1999, it has drawn more than 200 companies to Oracle's eBusiness workshops. "I don't believe our sales representatives could have gone to market as quickly as they did, without a tool like this," Borthwick says. "We've put a consistent tool in the hands of every Oracle consultant in the world."

What the Judges Said: "Increasing services sales effectiveness is a big issue that marketing organizations need to think about. How do we provide the salesforce with information and leads to help them be more effective? Oracle has been very successful in using the e-Valuator tool in half-day or shorter work sessions. The information entered into this tool lets the representatives identify needs." "It's a great tool for visualizing eBusiness potential, and focusing on real business results. The eBusiness transformation was positive for Oracle's image." "This is a practical, useful tool to sell complex services."

What's Next: Oracle is currently in the process of installing the e-Valuator on its general-purpose website so that any website visitor can take advantage of the tool. The company intends to continuously revise the tool as the nature of eBusiness and the internet change over time

Building the Services Brand

marchFIRST, Chicago, IL The Challenge: The merger in December 1999 of two large internet services firms - Whittman-Hart and USWeb/CKS - created a large, nameless, global company that provided internet strategy, brand building, and technology assistance to 4,000 clients. But the company needed to invent a name, identity, and brand of its own that would soothe anxious employees, attract new talent, and impress investors and clients. It then needed to promote itself publicly, to attract new customers and reassure existing ones.

"We weren't just launching a company; it was a new class of company, and a $1.3-billion publicly traded firm," says Jeff Jones, marchFIRST's global director of brand management. "The challenges were many: grappling with cultural differences on a global scale among 9,400 employees in 14 countries; melding differing business models; meeting Wall Street expectations; and satisfying the need for speed."

The Solution: The brand transformation took place on many levels. In order to understand the employees' attitudes and their perceptions of the merger, one-on-one interviews were conducted with more than 3,000 of those individuals. Employees and executives together then chose the name marchFIRST after considering 4,000 possibilities. The name was chosen to represent that the company helps its clients be first to market, first to an idea, and first to shareholder value; that the company itself is moving forward; and to highlight the founding date of the revamped company - March 1, 2000. Once the company name was chosen, the rest of the branding process had to be completed in 120 days so that the company could launch the new brand on that day.

A visual style, color usage, and typography were chosen for the logo, marketing collateral, print and TV ads, and stationery. The $50-million marketing initiative promoted the brand in employee events; collateral; and print, TV, and online advertising. An 80-page brand book, which explained the brand to employees, was designed to help build employee enthusiasm ("Get those marchFIRST tattoos. Write those marchFIRST folk songs. Customize your Harleys.") An intranet was rolled out to improve company-wide communication, and a recruiting brochure was filled with quotes about what employees liked about working at the company, and what inspired them. Brand advertisements focused on the idea of "firsts": the first men on the moon, the first correspondent at the South Pole, the first Cubist exhibition, etc.

The Results: Since all the ads and marketing materials directed people to marchFIRST's website, site traffic is a good indicator of this campaign's effectiveness. Within three months of the start of the campaign, marchFIRST was attracting an average of 411,086 visitors to its website - double the number of visitors it pulled in the first month. By the third month, the number of visitors who returned to the site within 30 days had grown to 87,242 from 6,450 the first month. The average user session grew in length during that period from 11:34 minutes to 24:30 minutes.

On the recruiting front, the company received 11,303 resumes in the campaign's third month, more than four times the 2,571 received in the first month.

What the Judges Said: "In 90 days, the company completed an incredible amount of market research and analysis to understand the new name and how to launch it." "They did wonderful things to build excitement and acceptance of the brand with employees. What's more, a 90-day launch was unheard of a year ago, and the company demonstrated significant results in that timeframe." "They won the award because of the impact and success of the new brand launch, its comprehensiveness and its components. It's a well-thought-through, unified brand." "marchFIRST employed a very comprehensive approach in addressing external and internal issues in a short period of time, with phenomenal project management and clear visioning."

What's Next: "We built fast brand awareness for marchFIRST," Jeff Jones says. "Next, we'll deliver a value proposition for the company. We'll come back with the payoff as to what marchFIRST does, and shift from an employee recruiting focus to building relationships with clients. The website will tell visitors who our clients are and what we've done for them."

-- Reprinted with permission --

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.