Tuesday, June 22, 2010

Companies Dedicate 2x More to Marketing Than IT

According to MarketingSherpa's B2B Marketing Spending Benchmark Survey, large organizations dedicate on average 6% of revenues to marketing spend, including advertising, digital marketing, marketing services and internal labor expenses / costs.

I found this number surprisingly higher than anticipated. Comparing marketing spending to IT spending, IT spending averages half as much, at only 3.1% of revenues on IT (from Alinean's ValueBase research). No wonder there is a focus on return on investment from marketing as never before!

The highest spenders proportionally are small organizations, those with less than 100 employees, dedicating some 11% of revenue to marketing. In the survey, mid sized organizations of 100 to 1000 employees, indicated spending of a still significant 9% of  revenue on marketing.

According to MarketingSherpa analysts, the difference between large organizations to smaller organizations is a  reflection in the economies of scale from marketing spending being higher in large organizations, more so than it indicates aggressive marketing spending by smaller organizations compared with larger counterparts.

The analysts from MarketingSherpa indicate that "For companies of all sizes, a decline in revenue has resulted in marketing budget reductions and a shift to more cost-efficient digital tactics, such as email, search and social media. Organizations that have been required to stretch every dollar during this recessionary period are getting more mileage from these new media tactics."

More information can be found at: http://www.marketingsherpa.com/article.php?ident=31641#

“Information Overload” Biggest Change Agent for Marketing in Next Decade?

In a recent article on the 10th anniversary of B2B magazine, marketing leaders were asked to look back on the past 10 years and reflect on the biggest changes in B2B marketing. Experts discussed the strategic rise of the CMO, digital marketing and the rise of on-line spending, and advancements from technologies such as search, online video, social media, and analytics.
This got me thinking. What will the biggest change agent be over the next 10 years?

In the time it took me to read the B2B article, I received 15 unsolicited marketing e-mails, 3 tele-marketing calls, and 2 dozen tweets - none of which were of interest or relevance to me. And it dawned on me that this is the greatest challenge for the next 10 years– Information Overload.

Seems like this same challenge is dawning on others as well. Christa Carone, CMO of Xerox Corp in her Direct Marketing Association’s Digital Marketing Days keynote indicates that “Xerox is faced with the same challenges as every other company, which is cutting through the clutter in a world of information overload.” The challenge according to Ms. Carone is that “Marketers must “break through the barrier” of simple personalized communications into more relevant one-to-one interactions with customers.”

But how can this be accomplished easily and where to start?

One of the best ways we have found to connect with customers one-on-one is through interactive white papers. These interactive white papers ask a few simple profile and opportunity questions, and then intelligently combine qualitative content such as relevant situational analysis, case studies and next steps with personalized quantitative savings and value assessment– all to create completely relevant and compelling content for the buyer. The results – interactive white papers are more than 65% more effective than their static counterpart at attracting qualified leads and speeding up the sales process.

The basic white paper is still one of the most important pieces of marketing content, used and trusted as the key buying decision tool by over 65% of early stage buyers, and 61% of middle stage buyers according to relevancy and buying cycle research by SiriusDecisions (May 2010). Other marketing tools such as peer referrals, webinars, e-mails, user events, analyst reports and case studies all lag considerably in early and middle stages of the buying cycle.

The good news is that most organizations have invested heavily in white paper content that is of great value to most customers. The bad news, is that in a world of information overload, these white papers are getting lost and are not deemed relevant to today's frugal buyer. Its no longer good enough to have a one size fits all approach to white paper content.

Why not? Ever get a white paper from a company only to find it didn’t speak to your needs:

  • You’re in financial services, yet all the case studies in the white paper are about manufacturers.
  • You’re a local government, yet the white paper is talking about revenue drivers.
  • You’re a small business, and the contents all about enterprise systems management.
  • You’re located in the UK, yet every case study is from the US, and savings figures are in US dollars.

What-if you could automatically produce for each prospect, based on company profile and unique opportunity, a completely customized, personalized and relevant white paper – customizing both qualitative and quantitative content to reflect each buyers unique situation?

Some profile criteria that are typically used to tune white paper content to be relevant, personalized and specific:

  • Industry
  • Location
  • Organization's Size
  • Role in organization
  • Role in buying cycle
  • Stage in buying cycle

To go beyond profile customization, the interactive white paper could include additional questions, analyzing and diagnosing specific opportunities and issues and driving quantitative and quantitative content based on these responses. Such additional content personalization questions could include:

  • Top goals and desired outcomes
  • Top issues and pain points
  • Current practices (with intelligent diagnosis in the tool of which ones are most behind the times)
  • Current spending (with intelligent diagnosis of how solutions could be used to generate savings)
According to Ms. Carone, “Despite the flood of media messages, people remember little more than one-tenth of 1% of them,” she said. “As marketers, it’s important that we don’t take our eyes off the ultimate prize...... The key is relevant communications: the right messages via the right media at the right time.”

As white papers reign important in buying decision cycles, we have found that interactive white papers can leverage and turbo-charge existing white paper content, and provide ideas for new connections - breaking through the information overload with relevance and personalization.

As information overload increasingly becomes the challenge for marketers over this next decade, the interactive white paper becomes one of several key tools to help break through the clutter and connect with buyers.

Interactive White Paper Examples

Some examples of Alinean interactive white papers can be found at:




Xerox CMO Carone stresses need for more relevant marketing, BtoB Magazine, Christopher Hosford
Story posted: June 15, 2010 to http://www.btobonline.com/apps/pbcs.dll/article?AID=/20100615/FREE/100619932/1001#seenit

SiriusDecisions survey examines trusted b2b sources

The IT Innovation Dilemma Grows

According to a recent article by Information Age, the economic recovery is slowly easing cost cutting pressure on beleaguered CIOs, but at the same time innovation investments continue to decline.

In the results, a survey of more than 2,600 global IT leaders by recruitment specialist Harvey Nash, the effect of the great recession on CIO decision-making “appears to be receding, with 74% citing cost saving as a key issue during 2009, down from 84% a year previously.”

This bottoming process however does not mean new investments are off to the races. According to the study, “the number of CIOs who are prioritizing innovation over ‘keeping the lights on’ appears to be shrinking further, with 38% referencing innovation as a key issue last year compared with 41% in 2008.”

“The results show that the CIO community is currently wrestling with significant pressures as the Great Recession fades into history and a new decade, with a new competitive landscape, emerges,” wrote Harvey Nash chief executive Albert Ellis.

Alinean discusses the latest research on IT Innovation and what it means to IT Vendors here: http://tompiselloroiguy.blogspot.com/2010/06/it-innovation-suffering-through-long.html

The original Information Age article can be found at: http://www.information-age.com/channels/management-and-skills/perspectives-and-trends/1261193/cost-cutting-drops-down-cio-priority-list-but-so-does-innovation.thtml

Selling to the Unreachables

SiriusDecisions Insight and Alinean Advice on Selling to Sr. Level Executives

In a recent SiriusDecisions podcast, research analyst Jim Ninivaggi and Jonathan Block discussed best practice research and tips for selling to senior-level B2B executives, dispelling several myths on the best approaches for executive selling.

Get to the single Sr. Level Decision Maker?

According to Mr Ninivaggi, there is no longer a single decision maker / executive in most organizations. Instead, this has been replaced with more stakeholders, with a more collaborative decision making approach. There are now a series of decisions, and a series of decision makers, making the sales process non-hierarchical, and non-linear.

Alinean Advice: When a salesperson or team meets with a prospect, they need to be prepared to speak to the opportunities of each stakeholder, and communicate the unique value of the proposed solution to each as well. Most sales professionals, adept at selling to the technical buyer, will be ill suited for the cast of stakeholders now involved in each buying decision. Sales enablement will need to arm the sales professional with tools to enable effective discovery of business opportunities and communication of value to each diverse buying decision maker.

Alinean Case Study: Unisys’s IT Managed Services group realized that when engaging in the buying process, they needed to have a different dialogue for different buyers. Some buyers cared about the IT spending, while others cared about strategic alignment, business impact, and service levels. An IDG
Alinean developed assessment toolset allowed Unisys account teams to quickly assess the prospect organization’s current practices, spending and performance, creating a 40 page executive assessment, with sections to appeal to executive, IT management and business management alike.

Call Early and Often?

The mantra has always been to call early and often on the Sr level executive. If you could get the appointment, you should sell as high as possible.

However, according to the SiriusDecision analysts, if sales professionals call too early on Sr. Level Executives, they may not have enough knowledge of the business goals, opportunities and competitive challengers to deliver value, and may even disrupt the now customer driven buying process. The meeting too early and without value add will derail the process, not accelerate the buying cycle.

Alinean Advice: Salespeople are many times not prepared to meet with Sr. Level Executives. These executives are often looking for consultative and prescriptive insight and advice. If your sales professionals are all ex-Mckinsey consultants, this should not be an issue. However, how many of us understand the customers industry and challenges enough to add value to each executive we meet with?

The key is to create a structured discovery, diagnosis and prescriptive framework and tool to assist the sales professional.

Alinean Case Study: Microsoft realized they were being too tactical with their customers, and not being able to reach executives, or when they did, not adding enough value. Alinean helped created Infrastructure Optimization assessments, an online toolset that enables direct and partner account teams to assess the organizations current IT and business productivity tool best practices, scoring the organization against a capability / maturity model. The tool compares the organization against peers showing the organization clearly where they are leading the charge, or falling behind the competition. A prescriptive roadmap of practice improvements and solutions concludes the diagnostic presentation.

Having participated personally with Microsoft on such engagements, you can see the relationship change and elevate within each account its used in – empowering sales professionals to connect meaningfully with the executive buyers.

Solution Selling is Best for Executive Meetings?

The current way to sell is a consultative sales methodology – let the customer speak as much as possible about their issues, asking many questions to learn about pain points and provide advice. Consultative or Solution Selling works with Technical or Business Group buyers, but doesn’t work with executives according to SiriusDecisions.

Sr. Executives are different. You have to earn right to ask questions. As SiriusDecisions points out, the engagement has to be Prescriptive, not Consultative.

Executives are looking for industry insight, benchmarks, competitive comparisons, and best practice advice.

According to SiriusDecisions, its essential in order to gain and maintain access, to have something of value to communicate, and work through sponsor to get access with this value added content and prescriptive information.

Alinean Advice: Sales enablement could benefit sales professionals seeking an executive engagement, by delivering insight / benchmark tools.

Alinean Case Study: HP needed a tool to get the executive appointment. Using Alinean’s IT Peer Comparison tool, containing a database on financial performance and IT spending for 20,000+ organizations worldwide, HP compares the target organization’s IT spending with industry competitors / peers to create a customized benchmark report. This report is proactively delivered in summary form to executives to get the meeting. Working with an India sales proposal group, once the appointment is set, the HP account team is armed with a full briefing book containing the Alinean IT Peer Comparison report, as well as additional customized industry insight and diagnostics. As a result, the sales teams are empowered to get more executive meetings, and importantly, armed with the dialogue to connect better in the meeting.

If you Can't Connect, Move On?
SiriusDecisions indicates that if you cannot connect to the executive, its not all for loss. Access by proxy is still valuable. The key is to arm your customer champion or coach with the tools they can use to sell your advice, ideas and proposals upwards in the organization.

With buyers being economically driven today, as we all know “frugalnomics” now reigns, this typically includes not only prescriptive advice, but ROI business cases.

Alinean Advice: In the early phase of the buying cycle, if you can’t get access, arm the champion / sponsor with prescriptive assessments, gauging the organization versus recommended best practices, peer and leader comparisons that will be compelling to the executive.

In justification phase, be sure to arm the champion / sponsor with the evidence they need to communicate the quantified value of the solution to the executive. A formal business case using the customer’s unique opportunity and return on investment metrics is essential.

In the decision phase, be sure to not lay the groundwork and lose to a cheaper competitor. Provide total cost of ownership comparisons to be sure that the executive understands the full investment costs and doesn’t derail the process with the cheapest up-front solution, or selecting a solution with less capabilities / value overall.

Alinean Case Study: ShoreTel delivers Unified Communication solutions in a highly competitive environment. Their solution offers one of the best feature sets, values and lowest costs compared to competitors which include Cisco, Avaya and other industry giants. Champions needed a way to communicate the value of the solution to executives who were not aware of ShoreTel compared to competitive offerings. Using third party developed Alinean TCO tool, loaded with independent industry research, sales teams are able to arm customers with the evidence they need to make the best IP telephony / UC choice.

The Bottom Line
Executive selling has changed substantially over the past decade, as frugalnomics now reigns. Sales enablement groups that recognize these changes can arm sales professionals with the tools they need to reach executive decision makers and garner greater success. Marketers must also realize that the connection and dialogue with executives has changed in similar ways. Tools can be used on-line and via sales professionals and partners to facilitate the process and connection with these frugal executives to shorten sales cycles and win more business.

The SiriusDecisions podcast can be accessed at:

Wednesday, June 16, 2010

This isn’t your Dad’s B2B Sales and Marketing

Back in the day, in the 1970s and 80s, companies like Xerox and IBM established the best practices on how B2B, and especially technology, was successfully marketed and sold. But according to Jefre Ogden, President of Find New Customers, the way your Dad sold back in the day is over. Done. Kaput.

The catalyst for this change has been the Internet, which has clearly made more information and tools available to decision makers, and put the buyer in control, and Frugalnomics, the age of austerity which drives buyer focus on value and the bottom-line vs. innovation.

As a result, B2B sales and marketing will never be the same, evidenced by “how so many things we did when we sold to businesses in the past — things that actually worked well — no longer work.” According to Mr. Ogden.

And what used to work but doesn’t now? Here’s a list of how the B2B selling cycle has dramatically changed:

Out with the Old: Get to the Decision Maker to get the sale

In with the New: Today, B2B buying decisions have more stakeholders than ever.  To be successful, you often have to engage executives, finance, business leaders, purchasing, operations and technologists, and provide compelling value messages to each stakeholder. The challenge, how do you market with what matters to each stakeholder personally, and empower sales professionals with the right content, knowledge and value metrics to be compelling to this diverse group?

Out with the Old: A nice website will get people's attention Unfortunately, most everyone has a nice website.

In with the New:  In the new world where buyers are in control, content is king. Studies indicate that 9 out of 10 buyers consumed and relied on content on their way to purchase decision: especially white papers, eBooks, webinars, interactive analysis tools, podcasts, and video clips. And the content that worked best was content personalized to the buyer: their industry, their title, their stage of the buying process.

In the age of Frugalnomics, where value and savings reigns supreme, engaging buyers with personalized tools to help them diagnose their issues, identify savings opportunities and prove savings / value are more important than ever.

Out with the Old:  With enough leads and we will find more sales opportunities Buyers are inundated with cold-calls, e-mails and sales pitches, making qualified leads harder than ever to generate, and making “cold calling” a thing of the past.

In with the New: According to Mr. Ogden, “9 out of 10 of buyers say, when they are ready to buy, they find you.” And when they find you do you have the right tools to engage them? The marketing mix needs to change, investing in the right tools and content to engage the buyer, rather than cold calling.

And if you do reach out to buyers, adding personalized value to every outreach is required. Valuable research and interactive tools are required.

Out with the Old:  If we optimize our website for search, we'll attract prospective buyers

In with the New:  Unfortunately, most buyers rely on vendor relationships and recommendations and not search. According Mr Ogden, “7 out of 10 buyers say they start their buying process at vendor sites, not Google.”

This is emphasized in recent buyer surveys from SiriusDecisions, analysts and peers are the most trusted buyer resources earlier in the sales cycle. Analyst case studies and validation, and peer social network recommendations are key to early engagement success.

Later in the sales cycle, personalized value-added content, tools and advice via the corporate web site or micro-sites is required. Don’t have the information buyers are looking for as they do their research, and don’t have the content validated by analyst and peers for credibility, and you can lose the deal.

Out with the Old: Follow a strict sales methodology, including qualification on budget, access to power, needs and timeframe (BANT). Then walk them through the sales cycle — with a demo, proposal, etc.

In with the New: Today, buyers engage with you at different stages, some earlier than others. As well, with more decision makers and more information available, neatly moving though a sales cycle is a thing of the past.

Formal budgets have been replaced with austerity, ad-hoc decisions and more discretionary spending. To win, you have to proactively diagnose customer issues and provide business cases to prove better value than other investment opportunities in order to be in line to grab the discretionary budget when its available.

Formal routines such as Answering Requests for Proposals (RFPs) are a thing of the past.

The Bottom Line

“The reality is that buyers move back and forth though a buying process and come up with budgets in an ad hoc approach. The nice and neat process of the past is dead,” concludes Mr Ogden.

The buyer is now in control in the age of Internet fueled decision making and Frugalnomics. The successful B2B marketer and seller recognize that the old ways to success are dead. Today the roadmap to success is a proactive facilitator in the buying lifecycle, providing personalized content and analysis to help diverse group of decision makers value the correct purchase decision.

The original SandHill.com article by Jefre Ogden can be viewed at: http://www.sandhill.com/opinion/daily_blog.php?id=51

B2B online marketing continues ascent despite tough economy

Rapid 12% annual growth led by Social Media, Lead-Gen Micro-Sites and Online Marketing Services

B2B online marketing continues to grow, with research firm AMR predicting an annual compound growth rate of 12% into 2013. With estimated spending of $3 billion annually in 2009, at this growth rate, B2B online marketing spending approaches $5 billion annually at the end of 2013.

The areas with the highest annual growth rate, not surprisingly, are social media spending (21% annually), followed by lead generation websites / micro-sites (17%), and online marketing services (15%).

A summary of the report can be viewed at:

Tuesday, June 08, 2010

IT Innovation suffering through a long recession

From PA Consulting Group, a new CIO survey confirms what many already know: one in three (74%) have been asked to reduce IT budgets and similarly (75%) have been tasked with increasing operational efficiency to deal with the recession.

Of note in the survey, 55% are not setting innovation targets. Not surprisingly, innovation is suffering in this recession as it has in past slowdowns.

Each year Alinean examines the delicate balance in IT budgets between on-going operations, migrations and upgrades, and innovative investments. From our research, in 2009 innovation and migrations / upgrades suffered as budgets fell victim to the changing economic climate:

  • IT Operations (keeping lights on) - 66%
  • Upgrades and Migrations - 23%
  • Innovative IT Projects - 11%

This reversed a promising trend throughout the past decade of increasing innovation spending and reduced on-going operational costs.

According to HP research, the innovation gridlock caused by the budget pressures is having a significant impact on corporate performance.

A summary of the research can be found at:

Thursday, June 03, 2010

Who Do You Trust? Industry Analysts Reign Supreme

A SiriusDecisions survey recently examined which b-to-b sources are trusted most by buyers during the buying lifecycle, and the results indicate not surprisingly that Industry Analysts and Peers are the most influential and trusted sources of information.

In an age of information overload, over 30% higher than years past, the research indicates that buyers are trying to find ways to cut through the noise and get help to solve their specific problems / personalized advice and references that proposed solutions will deliver true value.

The least credible source not surprisingly was vendors themselves, pointing to the need for vendors to:
  1. receive third party validation and leverage content, especially from trusted analysts and pundits
  2. use social media such as blogs that contain advice and peer communities and groups to gain more trust
The survey results are summarized in the report, “SiriusDecisions B-to-B Buyer's Survey 2010,” and is based on an online survey of more than 600 b-to-b marketers conducted in April and May. The research was presented for the first time at the May SiriusDecisions 2010 Summit in Scottsdale, Arizona

This research was an important follow-on to a survey in 2006, the latest research examining sources of information b-to-b buyers consider during different stages of the buying process and the influence of each on their purchase decision.

Analysts are Most Trusted

The most trusted sources of information overall are industry analysts (cited by 31.4% of respondents) and peers (28.7%).

The influence of vendors as a trusted source of information has also increased, from only 3.3% of buyers who cited them as a trusted source in 2006 to 8.1% this year, but remains dramatically lower on the trust scale than other sources.

In the early stage of the buying lifecycle, the most influential sources of information for b-to-b buyers are internal events or triggers (cited by 31.1% of respondents), peers (24%), industry analysts (15.6%) and trade publications (13.3%). Search engine results were cited by only 4.4% as trusted sources; consultants, by only 2.2%.

The most favored sources of content during the early stages of b-to-b decision-making are white papers (64.4%), peer referrals (51.1%), webinars (48.9%), trials or demos (42.2%) and analyst reports (37.8%), the survey found. Buyers are looking for diagnostic advice and ideas, and white papers as well as executive assessment tools provide a foundation today for early decision making.

In the middle stages of buying, the most influential sources are peers (22.7%), industry analysts (15.9%), trade publications (15.9%), vendors (11.4%) and internal events (11.4%). Notably, the influence of vendors in the middle stage has gone up since 2006, when they were cited as a trusted source by only 3.5% of buyers.

In the late stages of decision-making, the most trusted sources are peers (28.9%), industry analysts (20.0%), trade publications (11.1%), consultants (8.9%) and search engine results (8.9%). From these results, it would appear that peer comparisons and personalized benchmarks could be a great help in guiding decisions and winning trust in these later buying stages.

Vendor Brightspot?

When vendors deliver unique independent, and personalized advice, connections are made and trust gained. SiriusDecisions points to blogs as one way to break through.
“Buyers are willing to have engagement with vendors if they can bring very valuable content,” Neeson said. He pointed to Chuck's Blog, written by Chuck Hollis, VP-global marketing and chief technology officer at IT company EMC, who blogs on topics such as virtual storage and cloud computing.

A great article by Kate Maddox of B2B Magazine providing a full overview of the study can be found at:

Discretionary IT Budget up for Grabs: Are Your Sales & Marketing Campaigns Ready?

Recent reports from IDC and Gartner confirm earlier predictions that 2010 will see a rise in IT spending.

IDC's latest predictions point to a 3.8% year over year increase in global IT spend, led by a 6.4% rise in hardware (PCs, servers, storage and network equipment), a surprisingly modest 3.1% gain in software spend, and a sluggish 1.5% service spending increase.

Gartner has a slightly more optimistic outlook, predicting a 4.1% spending increase in 2010 compared to 2009, with the largest increases in the government / public sector.

Both of these spending forecasts are about half of Forresters estimates, which remain above 8% for the year according to estimates from April's quarterly financial briefing. It remains to be seen whether Europe's financial troubles and slowdowns in China impact these expectations.

Regardless, IT spending growth remains strong for 2010, although frugalnomics still reigns, with economic buyers clearly in control (those who seek to reduce costs and achieve highest value from every purchase).

As most of this growth in spending is not baked into existing budgets, solution providers have a unique opportunity to connect with these economic buyers, and jump ahead of spending decisions. We recommend the following course of action during the customer buying lifecycle:
  1. Discovery - Proactively helping customers understand the opportunities,
  2. Consideration - Establishing the quantified value and priority for projects,
  3. Decision - Assuring the customer is getting the lowest cost / best value solution for every dollar spent.

The Bottom Line: We predict that Tech vendors who seize this unique value sales & marketing opportunity will grab most of the discretionary budget increases these studies are projecting.

A good summary on this research can be found at: http://www.cioinsight.com/c/a/Trends/IT-Gets-Out-The-Checkbook-121806/?kc=CIOMINEPNL06012010

How do the spending trends look from the field? Good overview in this article regarding the recovery and where investments are being made for 2010: http://searchcio.techtarget.com/news/article/0,289142,sid182_gci1511905,00.html?track=NL-964&ad=765352&asrc=EM_NLN_11535656&uid=748591

Unplanned Downtime Isn't Costly? Think Again.

In a recent study, Strategy Guide to Risk Mitigation for Midsize Businesses, IDC estimates that midsized companies, those with 100 to 1,000 employees per year, experience from 16 to 20 hours per year of downtime due to network, system, application and operational issues. Moreover, these 1.3 to 1.6 hours of unplanned downtime per month were costly, with average revenue losses of more than $100,000 per hour.

Based on these metrics, the average company in the study had unplanned downtime impacts of $1.6M or more a year.

With such high annual costs, how can organizations help to reduce unplanned downtime outages and recover this lost revenue?

According to IDC, implementing IT best practice availability technology, security and management best practices can reduce the annual outage risk by as much as 85% for these midmarket firms, reducing unplanned downtime to less than 15 minutes per month, and thus saving tens of thousands of dollars per year.

IDC recommends the following initiatives can be used to reduce downtime risks (with the percentages reflecting the reduction in downtime risk impact if implemented alone):
  • Management tools = 65%
  • Upgrade servers, storage, networking = 50%
  • Failover clustering for internally facing applications = 43%
  • Standardization on single desktop OS = 30%
  • Comprehensive PC security = 28%
  • Thin client / blades = 25%
  • Deploying multiple antivirus, antispam solutions = 15%
  • Server virtualization = 10%
Click here to learn more: http://www.idgdocuments.com/idgwhitepapers/HPTechDos0310/?pg=1&pm=2&u1=friend&sub_id=Bm8MBzGavMf5r

ROI conversations at the wrong time will get you nowhere

In a recent blog post, Scott Santucci, a Forrester analyst who serves Technology Sales Enablement Professionals, highlights how B2B solution providers are investing heaviliy in tools to connect more personaly with buyers, but with a decided lack of process and coordination, these investments are not reaping the promised rewards.

Certainly the need for personalized engagements is strong. As Scott highlights, "We are in the middle of a major transformation in the B2B sales model." driven by customer's "enterprise-wide strategic procurement initiatives .... to buy only what they need at the lowest possible price."  We call this trend frugalnomics.

Scott indicates that B2B vendors are investing in a variety of internal projects designed to combat the frugalnomics trend. Some common efforts include sales and marketing tools to reshape the customer engagement focusing on quantified value. B2B vendors are launching tools to help diagnose hidden issues and quantify the value of proposed solutions. These sales and marketing tools are among dozens of investment initiatives to address changing customer requirements.

Unfortunately, most organizations fail to properly coordinate these independent projects, with dramatic negative consequences.

We find that to maximize the value of B2B tool investments, these tools need to have specific conversations in mind, and focus on specific steps in the sales process - a coordinated playbook and engagement model for tool use is as important as the tool itself.

To learn more, view Scott Santucci's blog at: http://blogs.forrester.com/scott_santucci/10-06-01-key_sales_enablement_success_focus_conversation

Can Virtualization Drive Savings? A Quick Estimation Method.

An associate asked recently if there was a quick way to estimate the potential value of virtualizing a datacenter. The following model should help organizations quickly estimate the potential cost savings, and illustrate why datacenter virtualization is currently the highest priority project for most organizations.

In a typical datacenter, the spending is allocated as follows:
  • Management and Support Labor = 38%
  • Hardware = 20%
  • Software = 30%
  • Facilities (power / cooling and space) = 12%

Virtualization's first order impact is to the hardware costs, helping to consolidate servers (10:1 is typical average today, although higher consolidation ratios are available), and reduce storage costs with SANs, reducing headroom and overprovisioning by 25%. Overall virtualization can reduce hardware costs (acquisition, support contracts) by an estimated 40% overall.
Facilities costs are reduced with consolidation of hardware, and modernization with more energy efficient servers, helping to reduce power, cooling and space costs by 45%-50%.
Net software costs are harder to reduce, as virtualization software / management tools usually require an incremental software investment. However, when virtualization occurs reconciliation of licensing is usually performed at the same time, and some physical server based licensing can be avoided, helping to offset the incremental virtualization software investment.

Management and support costs are also reduced via streamlined provisioning and reduced change costs, estimated to reduce datacenter management and support labor by 15% to 20% overall. Improving management tools and practices maturity while virtualizing can yield much higher improvements of 25% or more.
Tallying these costs overall yields an annual 20% moving from a non-virtualized to virtualized datacenter.
What can this mean per application? With $6 to $9K per application per year typical, annual savings of $1,200 to $1,800 can be expected.

Wednesday, June 02, 2010

SiriusDecisions profiles value of Alinean and it's sales / marketing tool offerings

According to SiriusDecisions:

"Successful reps know that establishing credibility and providing value to a prospect or customer throughout the buying cycle is the difference between closing the deal and losing it. They must ask the right questions,gather data and coherently identify need in the context of an opportunity, then be equipped with the proper tools as the opportunity progresses."

"Alinean’s customer-specific benchmarks, company comparisons,executive assessments, benefit and cost analyses can significantly upgrade the quality of demand creation and sales enablement interactions throughout the buying process, allowing prospects to drive at the beginning through simpler, self-service tools and sales to provide greater depth as the buying process proceeds. When these tools are used in a consistent, process-based manner, they become even more valuable."

Read the rest of the Alinean profile at: http://www.alinean.com/Resources/Alinean2010Profile_SiriusDecisions.pdf