So will Gartner’s rosier IT spending growth predictions ring true into the New Year, or will the figures again be discounted as the year progresses? Although I too am more optimistic about 2013 compared to last, there are clear and immediate challenges that deserve action regardless.
2013 Challenges for IT Solution Providers
Revenue growth is extremely important for IT solution providers, as this growth is required to sustain high valuation multiples. As a result, IT Sales and Marketing will again be tasked to deliver incremental revenue regardless of challenging market conditions and despite the historically low spending growth.
The 3 Things You Must Do Now to Win in 2013
To help meet the challenge and Fight Frugalnomics, we recommend three “must do” programs for 2013:
Engage Frugal Prospects with Provocative Marketing
Todays’ buyers are more overloaded and risk averse than ever, and as a result, 58% are choosing to “Do Nothing”, to remain with “Business as Usual” versus considering your solution.
- Why Change? – the Prospect has a pain worth addressing and a significant cost of “Do Nothing”.
- Why Now? –the Prospect should not wait to address the issue because they are leaving good money on the table (significant bottom-line impact, ROI and fast payback), and they are falling behind competitively (illustrated through peer comparison benchmarks).
- Why You? – that your solutions can deliver unique value at a lower total cost of ownership (TCO).
Empower Sales with Value Storytelling and Quantification
According to SiriusDecisions, the number 1 reason why sales professionals fail to meet quota is their “inability to effectively communicate the value of proposed solutions”.
Close the Deal with a CFO-ready Business Case
CFOs are large and in charge of many IT purchase approvals. According to a Gartner and Financial Executives Research Foundation research survey, the CFO is becoming the top IT decision maker in many organizations, with:
- Over 75% indicating significant decision making involvement,
- 41% indicating being the main decision maker for IT investments.
- Won't be considered a priority without a business case, and the larger the proposal, the more detailed and formal the case has to be.
- Won't be approved unless you show that the issue being addressed is a priority with a high cost of doing nothing, and can deliver quantified savings / benefits, significant ROI, fast payback, all with low risks / resource requirements.
- Won't be signed off unless you can prove your solution has a lower total cost of ownership (TCO) / better value than competitive offerings.
Gartner’s more optimistic IT spending growth estimates for 2013 are good news, but don’t change the fact that Frugalnomics will remain in effect even as technology spending improves.
If not addressed, deals will continue to stall, sales cycles will get longer, and heavy discounting will prevail.
For 2013, IT Marketing and Sales Enablement professionals should consider three initiatives as a top priority to help Fight Frugalnomics:
- Engage Frugal Prospects with Provocative Marketing
- Empower Sales with Value Storytelling and Quantification
- Close the Deal with CFO-Ready Business Cases
- IDC 2012 Buyer Experience Study (a survey of 204 IT buying organizations)
- Forrester Sales Enablement Conference 2012
- SiriusDecisions SiriusIndex, results from 2011 - 2012