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Showing posts from June, 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 bein…

“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 cu…

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 exec…

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 i…

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 …

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:
http://www.marketingcharts.com/direct/b2b-online-marketing-holds-strong-growth-potential-11862/amr-intl-b2b-online-mktg-forecast-feb-2010jpg/

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 imp…

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:
receive third party validation and leverage content, especially from trusted analysts and punditsuse social media such as blogs that contain advice and peer communities and groups to gain more trustThe 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 m…

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 ac…

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 c…

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…

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,…

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_SiriusDecision…