|
       |
| About Us | Our Team | Our Members | Job Opportunities | Directions | News | Site Search |
 |
Location: | ||||||||||||||||||||||||||||||||||||
|
Editor's Note: Skilling Up? I wrote last month about rethinking marketing budgets from the perspective of audience. Are you allocating resources appropriately across the different constituencies with which marketing needs to connect? Continuing on the budget question (it is planning season for many marketers, after all), I'd like to suggest this month that we look at investments in professional and organizational development. Last year, services marketing organizations participating in ITSMA's annual benchmark study invested about 5% in professional development. Is this enough? With all the demands on marketing for greater efficiency and productivity, one might think that some extra investment in skilling up is well worth the cost. Simply pushing people to work harder without helping work smarter is a recipe for unhappy folks and scant organizational improvement. Related to how much investment, of course, is investment in what skills in particular. Here, I'd point to three priority areas: business or commercial savvy, relationship building (internal and external), and digital communications, especially around community building and collaboration. Clearly folks can suggest other needs, and all organizations are different. For my money, though, these three top the list in a world of hyper-competition and the emerging era of conversational marketing. What do you think?  [TOP OF PAGE] What's Hot: Conversational Marketing Three quick examples: A few weeks ago, a marketer in IBM's mainframe division posted three internal training videos on YouTube. The videos are well-done parodies of typical boring sales training presentations; IBM's marcom guy thought people outside the company would get a kick out of seeing and passing them around. A week before that, Sun's general counsel, Mike Dillon, became the first chief lawyer in the Fortune 500 to launch his own blog, the legal thing…, joining Sun's CEO in the rarified atmosphere of executive bloggers among the top tech companies. And a few months before that, Juniper Networks launched "Sound Off," a podcasting initiative driven by user request. Participants in Juniper’s online community ask technical or business questions; the Sound Off team interviews in-house experts for podcast download and subscription. In one form or other, all three are about conversational marketing, getting past the trap of just sending messages to your presumed audiences and instead fostering actual dialogue about issues your stakeholders care about. As these examples demonstrate, slowly but surely, tech marketers on the B2B side are catching up to its primary arguments that:
If not yet typical, the three examples above are just a few of many similar initiatives across the industry. A number of large tech and services firms are experimenting with blogs, podcasts, online communities, viral marketing, and the like, and positive results are beginning to emerge. And it's not just online. Tech and services marketers are also putting more energy into face-to-face "human" conversations with customer briefings, small seminars and roundtables, account-based marketing programs, and executive councils and networks. But it's not ultimately about the tools or programs, although some are certainly more useful than others. It's about mindset and direction. We know buyers of IT services and solutions want the conversational approach. They continue to rely heavily on discussion with colleagues, professional peers, and other experts to help them consider investment alternatives, and they pay less and less attention to most formal marketing and sales activity from the provider side. From our side, the question now is whether companies and their marketers can move from interactive experiments (online and offline) to a broader transformation. Can we shift the marketing mindset from packaged promotion to ongoing conversation? Marketing has always been about promoting stuff. Of course Promotion is only one of the classic Four P’s (and there is all sorts of debate about revising those four), but it has usually taken the lion's share of marketers' time, energy, and money. Good promoters certainly listen to the marketplace and rely on regular feedback from customers and others to create more compelling and useful messages and offers. But it's still one-way at heart, and it presumes that the promoter knows best. Conversational marketing, in contrast, assumes that the best answers emerge from the conversation itself. The aim of marketing is not to convince the customer (or other "targets" or "audiences") that you have all the answers, but rather to participate in and spark dialogues that collaboratively create answers beyond the ability of any one participant. As David Maister and Lois Kelly have suggested, "the goals of initiating and deepening relationships are vastly more important than conventional marketing's goals of 'building awareness' and 'generating leads.' And nothing—nothing—builds relationships better than regular, meaningful conversations." The InterviewInsight into Innovation: An Interview with Clayton Christensen Clayton Christensen, Harvard Business School professor, author of The Innovator’s Dilemma, The Innovator's Solution, and Seeing What’s Next, and keynote speaker for ITSMA's 2006 Marketing Conference, recently sat down with us to discuss why listening to your best customers isn't always good for the business and how technology companies can organize to ensure that they don't miss the next wave of growth. ITSMA: You've identified several different types of innovation. Could you outline them and explain how they differ from each other? Christensen: First we have "sustaining innovations." These are improvements to products and services that help established companies sell better products and services to their best customers. This is where the big industry leaders usually play—trying to make their bestselling products and services smarter, smaller, faster, and so on. Second is what I call "low-end disruption," which occurs when a company with a business model that allows for lower gross margins starts to offer products or services that don't appeal to the best customers in the market, but to the low-end customers, those who are overserved by the offers of the industry leaders. This is where a company like Wal-Mart plays—selling high volumes of low-priced offers. Third is "new market disruption," which competes against nonconsumption. Typically this will happen around a product or solution that has traditionally only been available to people with either lots of money or lots of skills. A good example of a service that is disrupting the telecom sector right now is Voice over IP. A few years ago, only those with deep technical skills even knew that talking over the Internet was possible. And the first VoIP calls were not so great—dropped calls, static on the line, and so on. There weren't many people who wanted to sign up for VoIP at first, but over time, as more companies have begun to experiment with it, the service has gotten better and the market is getting larger. ITSMA: Many of ITSMA's members are large, industry-leading companies focused on providing better services and solutions to their top customers. But it sounds as though these companies might be at high risk for missing out on the next wave of growth. What do you suggest well-established firms do to ensure that they don't rely exclusively on "sustaining innovations"? Christensen: Yes, established companies really do face a dilemma: If the core business doesn't listen to its customers, it won't succeed, but if it does listen to its customers, it will miss new opportunities for growth. Established companies need to recognize that money for disruptive innovation is made on a different profit curve than sustaining innovation, and that, at the beginning, they're not going to make the same kind of profit on future growth investments as in the current cash cows. The process for allocating resources for sustaining and disruptive innovations needs to be very different, and I'd recommend that established companies set up a separate business unit within the company that's sole focus is on disruptive innovation. If you don't separate it out, disruptive innovation will almost always take a back seat to sustaining innovation. ITSMA: What specifically can marketing do to help? Christensen: A big challenge for marketing is to figure out how just-emerging markets are structured and also to help shape new product or service packages that do an important job for customers who had been nonconsumers. Segmenting markets by the job that needs to get done rather than by product or service categories is very important, and the technology sector has made real strides in this area, with its move to solutions that address real business issues. Another important job for marketers at large firms who are called on to drive disruptive innovation is to keep an eye out for potential acquisition targets. Some questions that marketers should keep in mind as they evaluate new disruptive ideas and opportunities include:
Ask Clay Christensen your own questions about how to generate innovation and growth at ITSMA's 2006 Marketing Conference on November 15 and 16 in Cambridge, MA. Register today and save 10%! On the Job: Accenture's Thought Leadership ProgramWhen people in the tech industry talk about thought leadership, Accenture is one of the first firms that comes to mind. The company's "high performance" messaging, its use of Tiger Woods in ads, and its extensive library of research and insights all contribute to the enviable success of Accenture's thought leadership in bringing attention and respect to the firm. This article, based on a recent ITSMA Viewpoint with Terry Corby, global marketing director for thought leadership at Accenture, outlines the key components of the company's program. The Basics According to Corby, the company started by defining what it meant when it used the term "thought leadership." He also explains that "all thought leadership we develop at Accenture must have a marketing message and value to the business … [It has] to connect firmly to our core brand value—High Performance Delivered. If something is not aligned to that, we don’t do it." Accenture brings the program to life by auditing itself regularly on each of its "Three Cs":
The company has also developed several key activities that are directly related to the Three Cs:
Measurement Accenture is also committed to measuring the effectiveness of its thought leadership. According to Corby, "There are some obvious practical measures that we track—for example, use of the Ideas Mart, and more important within that, the particular articles, publications, and topics [that are most popular]. We monitor use for two reasons. One is to know what is being used. The other is to find out what is not being used and why." However, Corby also explains that thought leadership "is far more about a way of thinking within Accenture and a focus on getting better outcomes for our customers," rather than an activity that is specifically designed to fatten the pipeline. Looking Ahead Despite its reputation for excellence in thought leadership, Accenture recognizes that it can't rest on its laurels; it must continually strive to evolve its thinking to stay on the cutting edge. To do this, the company believes that working with partners will help "to drive new thinking that moves our customers along and that moves society along." Although there is some apprehension around sharing intellectual property, Corby is confident that by carefully selecting the right partners, the benefits of working with partners on thought leadership will "far outweigh the risks." —Celia Gaffney, cgaffney@itsma.com For more on Accenture's thought leadership program, see our new ITSMA Viewpoint, Best Practices in Developing and Disseminating High-Performance Thought Leadership. Research Desk: Professional Services Companies Falling Short The data is in from Leaders and Contenders: ITSMA's 2006 Professional Services Brand Tracking Study, and the news is … lukewarm. As in years past, our research shows that, as an industry, IT professional services and solutions providers are not fully meeting client expectations. As you can see in the following table, the top two attributes of importance to customers are that their providers collaborate with them and are committed to delivering business results. Overall, the market perceives that firms are doing an average job in these areas, with performance gaps of 1.1 and 0.9 points, respectively.
Even the market leaders aren't coming close to meeting expectations; the leader of the pack for collaboration with clients received only a 4.0 in this area versus an importance rating of 4.7. And the five firms that received best-in-class ratings in terms of delivering business results received 3.9 ratings versus a 4.7 importance rating. It's clear that companies need to monitor customer expectations carefully and quickly adapt to changing priorities and needs. Taking advantage of some of today's cost-effective digital marketing tools such as blogs and online communities is one way to stay current with what's on customers' minds. In the end, though, the difference is going to come down to delivery; marketers need to figure out what customers want and then do everything they can to ensure that the customer experience reflects this want. —Lori Weiner, lweiner@itsma.com For more on this report, see: http://www.itsma.com/research/abstracts/BPS007.htm
[TOP OF PAGE] Upcoming Events Lessons From Other Industries – What Can We Learn From Investment
Banks, Airlines, And Construction? Marketing and Sales: A New Partnership Blogs and Beyond: Marketing in the New Digital Channels Growing the Business with Micro- and Account-Based Marketing Placing Your Bets: Marketing Investment Priorities and Tradeoffs ITSMA's 2006 Marketing Conference
Ask ITSMA! Do you have a services marketing question? (c) Copyright 2006, ITSMA Please forward this newsletter, but only in its entirety. Public citation or publication of any information herein is encouraged but subject to U.S. and international copyright law and conventions. Any citation must include full attribution to ITSMA. Individual graphics or paragraphs can be published without permission as long as attribution to ITSMA is included. Publication of longer selections or complete articles requires ITSMA permission. For permission or more information, contact pr@itsma.com. [TOP OF PAGE] Subscription Information Subscriptions are available in text and HTML versions. To SUBSCRIBE or to change the format of your subscription, visit http://www.itsma.com/aspfiles/press/ezine.asp. To UNSUBSCRIBE, please email us at unsubscribe@itsma.com or mail us at ITSMA Subscriptions, 420 Bedford Street, Suite 110, Lexington, MA 02420, USA. Back issues of ITSMA E-ZINE are available at http://www.itsma.com/News/ezine/default.htm. |
||||||||||||||||||||||||||||||||||||
|
About ITSMA |
|||||||||||||||||||||||||||||||||||||
|
|||||||||||||||||||||||||||||||||||||
