Archive for Marketing

Marketing strategy versus technology – should be a virtuous circle

Scott Brinker has another must-read post. I excerpt parts of his post below so I can expand on it a bit but you should read his full post along with the comments.

In his post Scott explains he is responding to statements made in a podcast by Joe Pulizzi and Robert Rose. After linking to the podcast and agreeing with much of what they say Scott makes three points:

  1. “Marketing technology is not just about efficiency — it’s about experiences.
  2. The relationship between strategy and technology is circular, not linear.
  3. Marketers cannot abdicate their responsibility to understand technology.”

and mentions the one quote he really disagrees with (emphasis is Scott’s):

“Figure out your process first. And then get aligned with your internal IT guys to figure out what it is you exactly need to facilitate. Because that’s the only thing that technology will ever, ever do. The only thing technology will ever do is facilitate a process that you have more efficiently. That’s all it’s ever going to do.”

That is a pretty strong recommendation for option A in Scott’s illustration below.

strategy technology circular

Scott Brinker – strategy and technology are circular

I want to make three points:

  • The fact that the relationship between technology and strategy is circular – that they have to inform, influence, and advance with each other – is true of all enterprise applications and for all functions and has always been true.
  • If you replace “technology” with “data” or “big data” or “analytics” the points that Scott makes are equally valid. (For a different take on this see Big data and decision making: data vs intuition.)
  • Technology is not just a set of product features. The features are possible because of creative combinations of underlying software concepts, programming languages, data structures, and architectures. Without some understanding of the underlying fundamentals it is natural to think product features define software capabilities and thus to limit insight into strategy possibilities. Marketers (or other professionals) with little to no technical background can compare feature sets and build strategies that match, or build strategies and look for the set of already existing product features to match. Each of these illustrate what we might call the bad kind of circularity (as we mean when we call an argument circular) and they handicap innovation. The good kind of circularity is a strategy/technology dialog of what ifs, informed by what might be possible, not by what is already known.

It is both natural and common for consultants to overemphasize option A, because way too often option B is overemphasized at the expense of option A by both their customers and technology vendors. Good consultants spend a lot of time and effort helping customers overcome an under-appreciation or political deprecation of the importance of strategy. But all of us need to be careful not to suggest either linear false choice.

What is Content, Context, and Educational Marketing?

The blog on our sister site, gilbane.com, is the place to tune to for our series of speaker spotlights and general updates about our upcoming conference in Boston. Here, I’ll be highlighting a few conference sessions and why we have decided to include them.

You could say that our conference has assumed content marketing since our initial focus on web content management has always attracted marketers. But there is certainly a lot more attention now paid to the crafting of content, as well as to matching content to context whether that is channel context, customer context, buying-cycle context, or better, at least these three. In spite of the wise-cracky session description, you will hear thoughtful and reliable commentary on one of the biggest buzz terms of the year.

C5. Content, Context, and Educational Marketing

Wednesday, December, 4: 9:40 a.m. – 10:40 a.m.

Content Marketing is certainly hot. But what is it? Is it new? Is it old? Was there ever a time when marketing was content-free? Has it always been content-free? Is there some new kind of content that makes marketing different? Is it a strategy, a methodology, a parallel universe? Snarkiness aside, it is easy to see that carefully created or chosen content can help improve success rates of different kinds of marketing objectives. This session takes a serious look at what content marketing is today, how you can use it, and how it is evolving.

Moderator:
Jose Castillo, President, thinkjose

Speakers:
Kipp Bodnar, Director of Marketing, Hubspot
WTF is Context Marketing?
Doug Bolin, Associate Director, User Experience Design, Creative, DigitasLBi, and Adjunct Professor, Mass Art
Beyond Content Marketing, The Emergence of Edumarketing

 

Integrating External Data & Enhancing Your Prospects

Most companies with IT account teams and account selling strategies have a database in a CRM system and the company records in that database generally have a wide range of data elements and varying degrees of completeness. Beyond the basic demographic information, some records are more complete than others with regard to providing information that can tell the account team more about the drivers of sales potential. In some cases, this additional data may have been collected by internal staff, in other cases, it may be the result of purchased data from organizations like Harte-Hanks, RainKing, HG Data or any number of custom resources/projects.

There are some other data elements that can be added to your database from freely available resources. These data elements can enhance the company records by showing which companies will provide better opportunities. One simple example we use in The Global 5000 database is the number of employees that have a LinkedIn profile. This may be an indicator that companies with a high percentage of social media users are more likely to purchase or use certain online services. That data is free to use. Obviously, that indicator does not work for every organization and each company needs to test the data correlation between customers and the attributes, environment or product usage.

Other free and interesting data can be found in government filings. For example, any firm with benefit and 401k plans must file federal funds and that filing data is available from the US government. A quick scan of the web site data.gov  shows a number of options and data sets available for download and integration into your prospect database. The National Weather Center, for example, provides a number of specific long term contracts which can be helpful for anyone selling to the agriculture market.

There are a number things that need to be considered when importing and appending or modeling external data. Some of the key aspects include:

  • A match code or record identifier whereby external records can be matched to your internal company records. Many systems use the DUNS number from D&B rather than trying to match on company names which can have too many variations to be useful.
  • The CRM record level needs to be established so that the organization is focused on companies at a local entity level or at the corporate HQ level.  For example, if your are selling multi-national network services, having lots of site recrods is probably not helpful when you most likely have to sell at the corporate level.
  • De-dupe your existing customers. When acquiring and integrating an external file — those external sources won’t know your customer set and you will likely be importing data about your existing customers. If you are going to turn around and send this new, enhanced data to your team, it makes sense to identify or remove existing clients from that effort so that your organization is not marketing to them all over again.
  • Identifying the key drivers that turn the vast sea of companies into prospects and then into clients will provide a solid list of key data attributes that can be used to append to existing records.  For example, these drivers may include elements such as revenue growth, productivity measures such as revenue per employee, credit ratings, multiple locations or selected industries.

In this era of marketing sophistication with increasing ‘tons’ of Big Data being available and sophisticated analytical tools coming to market every company has the opportunity to enhance their internal data by integrating external data and going to market armed with more insight than ever before.

Learn more about more the [yellow]Global 5000 database[/yellow]

 

Technology and IT Spending Metric Options

When planning for global market growth and sizing up the opportunities in various countries, there is often a lack of data available from various industry sources. One could look at GDP figures or population data by country – both of those have some limitations. A better gauge might be to look at those business entities that generate the most revenue in each country as they will help contribute to other businesses in the geography and in general, raise the level of B2B activity overall.

Diving into the data of the Global 5000 companies – the 5000 largest companies in the world based on revenue – we find a couple of different ways to help guide your estimates of market size and rank order.

The first list is the top 10 countries by number of firms in our Global 5000 database with HQ in the country.

  • USA – 2148
  • Japan – 334
  • China – 221
  • UK – 183
  • Canada – 124
  • Germany – 98
  • France – 84
  • Australia – 77
  • India – 76
  • Italy – 65

For each company in the database, there is an estimate for the amount spent on IT – both internal and external costs. When we take those amounts for each country and look at the average IT spending for these leading firms, we see a different order of countries which would also prove to be attractive targets.

  • France – $902 million per company
  • Germany
  • Netherlands
  • Spain
  • Venezuela
  • Italy
  • China
  • Switzerland
  • South Korea
  • New Zealand – $545 million per company

Of course, all these companies are the biggest of the big and not all companies in that country will spend at that level — but it is indicative of the relative IT spending on a country basis and again shows some of the potential for attractive markets as you eye global opportunities.

Learn more about more the [yellow]Global 5000 database[/yellow]

Tablet market evolution and mobile development strategies

It was only about a year ago that the tablet market was only really about general-purpose tablets. There was the dominant iPad, and the fragmented Android market. Ebook readers were a separate animal altogether, although the anticipated release of the first Kindle Fire raised the question of whether it would bridge the general-purpose and ebook market.

In some ways it did, adding enough apps and internet access that it was hard not to sneak in some work email or web research even when your laptop or iPad was purposely left at home for the weekend away with the family. But of course Amazon’s business model was/is different – a subsidized device to increase the sale of content. And Amazon’s use of Android was significantly more customized than other Android tablets.

The folks over at Tech.pinions continue to be a must-read for anyone following/investing in the tablet market. John Kirk in Battle of The Tablet Business Models: Lessons Learned and a Look Ahead, argues that the future of the tablet model will be determined by the business models behind them, and points out some consistencies and lack thereof between the major players, Apple, Amazon, Google, Samsung and Microsoft. He is surely right that too often commentators and analysts have focused on hardware characteristics and software and not paid enough attention to business models. However, product capabilities can either create new business model possibilities or prevent their success so also help determine the landscape. For example, a non-glare, color display with low power requirements that combines the best of an iPad and a Kindle will certainly have a material effect on the market. In any case John’s post contains a number of nuggets.

Another aspect to consider in tablet market evolution is the difference between enterprise and consumer tablet markets. We’ll look at that in another post.

IT Spending in the Financial Industry

In a previous post, we looked at IT spending across the landscape of all major corporate industry verticals of The Global 5000 sized firms and noted that the Financial markets lead the way in terms of spending on IT products and services. Finance covers a wide swath of companies and market niches so we are drilling down a bit further here to look at countries, sub-segments of finance and some specific company examples.

The major powers in the world are naturally where we find the biggest finance spenders. In this case, among Global 5000 companies the largest firms are US, UK, Japan, France, China and Germany.  Finance organizations in these 6 countries represent approximately 60% of the finance IT spending market. While many like to rush into new markets to be present when emerging growth starts to ‘pop’ focusing on the big players can obviously pay dividends.

Withing the finance sector, there are many types of organizations that specialize in various products and services. Looking at the 2 largest – banking and insurance, those verticals represent over 70% of the financial IT services market and banking is 50% larger than the insurance market. These two areas dwarf other niches including brokerage, private equity, holding companies and other investment services firms.

Looking closer at banking, US, France, China, UK and Spain are the countries with the largest IT spending. Drilling down further, we find the top 5 banks by IT spending metrics are:

  • BNP Paribas SA
  • Banco Santander, S.A.
  • Bank of America Corporation
  • HSBC Holdings
  • Industrial & Commercial Bank of China (ICBC)

In the insurance portion of the financial markets, the major countries leading the way here are: US, Japan, France, Germany and UK. Using the same type of benchmarks applied to insurance company revenues, the Top 5 Global 5000 companies would be:

  • AXA Group
  • Allianz SE
  • Assicurazioni Generali
  • Nippon Life Insurance
  • Meiji Yasuda Life Insurance

As you look at market planning and forecasts for serving the financial sector, lining up these segments, countries and individual companies with your own internal systems will help point you in the direction of some of the big spenders.

 

IT Spending by Industry … a way to estimate market potential

Nearly every organization likes to measure its activity and spending by comparing themselves to other like firms in their peer group.  Over the years,  IT spending has been one area that companies always try to measure this way.

The vendors who supply IT products and solutions have used similar metrics to help define market segments and accounts that may spend more than others and be more attractive candidates.

We took this concept to the companies in The Global 5000 — the 5000 largest companies in the world that are both public and private, across all countries, all industries. Using available research data we find IT spending as a % of revenue that can range from less than 1% for the construction industry to 6% in the financial services industry. The next step was to apply these IT Spending percentages for each industry sector to each company in the database.

Adding up the totals across the database, we find a total of $1.4 trillion is spent on IT products and services by the 5000 largest companies in world. Looking geographically, the countries with the largest amount of IT spend are the 3 largest by GDP as we would expect — US, Japan and China. Those 3 countries represent 52% of the large company spending in the world. Taking this a step further, if you are a provider of IT products or services and participate in markets around the world, a good metric for your business would to have 50% of your revenue coming from these 3 countries.

Looking at this from an industry perspective, the largest spending industries are Financial Services, Oil and Gas companies and the Telecommunications segment. That’s where the money is.

When we look at key industries within various countries the data does show some key differences.  For example, in the US, Health Care and Retailers come up strong in the top industries. In Japan, Autos and Industrial segments rise to the top. All of these metrics are worth considering as companies look to decide what markets, industries and geographies to focus on.

We’ll look to explore more details on IT spending by industry and country in the coming posts.

For more details on The Global 5000 database — click here

 

Harry Henry’s Global 5000 Insights

Colleague and market research expert Harry Henry is filling a hole in the company research market with his Global 5000 database of the 5000 largest global companies, including both public and private businesses. This is already an important resource for marketers who need to understand global market opportunities more than they ever have before – and that most likely means you, since most of our readers are from mid-to-large size companies who either are or should be growing their international business.

While we focus on the information technology strategies for reaching and engaging with customers and colleagues everywhere, you still need to decide which markets and regions, which industries, and which leading companies to target for growth. Harry has generously agreed to provide regular posts providing insights from his database to help inform those decisions.

Read Harry’s first post China Eyes Canadian Energy Resources. You can follow Harry’s posts on this blog at http://bluebillinc.com/author/hhenry/. Or you can reach him directly.

China Eyes Canadian Energy Resources

One of the interesting news announcements this week, was about CNOOC of China buying Nexen of Canada – an energy exploration company.  CNOOC is a $38 billion company and Nexen reported revenues of $6.3 billion in 2011.

For any company looking at global markets, there are some interesting developments wrapped up in this announcement.

This is a major step for a Chinese company, a major step in the energy industry and a major step for Canada.  Consider a few facts compiled from our Global 5000 database.

  • Canada’s energy assets are substantial. Looking at Global 5000 companies in Canada, right behind Financial Services, Oil & Gas and Mining are the next 2 largest industries representing 27% of the largest companies in Canada. So, as the world thirst for natural resources and energy continues to climb … Canada will get more attention.
  • Looking at growth rates over the past few years, China has grown faster than the rest of the market. So has the Oil & Gas industry as well as the Mining industry. The total Global 5000 grew 11.4% in 2010 and 12% in 2011. China based Global 5000 companies grew 33.5% and 30% in 2011. Oil & Gas firms reported growth of 22% and 24% for those same years while mining companies grew even more at 40% in 2010 and 30% this past year. So, this deal hits right at the heart of a number of growth segments.
  • This is a second big deal by a Chinese company in the North American market — see our article earlier this year on the Chinese bank ICBC entering the US market via an acquisition.

The bottom line here is that China’s economy is huge, its growth — even at lower rates — is still a huge differential and it has a continually increasing need for energy resources. Canadian companies have those resources so we can expect more deals and activity.

For more information about The Global 5000 and companies like these that are included, visit the database page.

Gilbane Conference workshops

In case you missed it last week while on vacation the Gilbane Conference workshop schedule and descriptions were posted. The half-day workshops tale place at the Intercontinental Boston Waterfront Hotel on Tuesday, November 27, 9:00 am to 4:00 pm:

Save the date and check http://gilbaneboston.com for further information about the main conference schedule & conference program as they become available.