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Are Ad Agencies Keeping Pace with the Marketing’s Massive Digital Uptake? (Hint: Maybe Not)

May 19, 2014/in Marketing /by 3 Created

Today, marketing’s equivalent to the Brady Bunch’s “Marcia, Marcia, Marcia!” just might be “Digital, Digital, Digital!” This is with good reason. Since 2009, digital marketing spend within large B2B tech companies has grown, and is growing, at an enormous rate. As you might have seen, IDC expects the entire tech industry to pass the 50% mark of digital spend vs non-digital spend by the end of 2016! This is the client side, but what about on the agency side, are these important partners keeping pace with their clients? At the end of April, Ad Age published their most recent “Agency report”, it shows the agency industry’s digital revenue over the past 5 years. While, agencies’ digital revenues are growing and, as a percentage, these revenues are comparable to what their clients are spending on digital – the lack of substantial growth for agencies’ digital revenue is notable.

As seen from the image above, 5 years ago agencies were already generating over 1/4 of their revenue from digital, where as tech companies were spending only 13% of their budgets on digital. Since then, these same digital marketing budgets have grown at a CAGR of approximately 21% – agencies’ digital revenue have grown closer to a 6.5% CAGR, a third the rate of tech marketer’s digital budgets. This begs the question, are agencies keeping up with digital innovation? Does the agencies’ slower digital revenue growth give us a glimpse into the future where in-house marketers are the digital experts?

Below are two comments that I think help parse out this story:

Chapter 7 in Scott Brinker’s (AKA: @chiefmartec) marketing book, A New Brand of Marketing, “From Agencies to In-House Marketing”, lays out the in-house vs agency shift perfectly. Traditionally agencies’ bread and butter is within the advertising campaign – as advertising has moved digitally, ad networks and ad-tech have continued to mature allowing practitioners to work directly with these networks and/or utilizing programmatic ad buying to optimize their spend. In a sense, cutting out the middle man (agencies). This might help explain the large difference in growth between digital revenue growth at agencies and digital spend from the practitioner. While companies are spending more dollars on digital, it is more of a do-it-yourself approach.
Anecdotally, through my conversations with clients and marketing executives, on more than one occasion I have heard marketers bringing core agency work internal. The two main reasons for this action are:

Scope: For marketing executives who are trying to build a full scale demand engine or attribution models, they are finding it very hard to identify an agency partner who can deliver this vision from start to finish, particularly with expertise across the entire project. (A fair caveat is very few companies can do this internally!) They are still utilizing agencies, but typically for projects around high level strategy or vision and/or very specific tactical portions of their larger campaigns.
Speed: To truly compete digitally, marketers have realized that speed is an asset. From content creation, to adjusting advertisements in real-time and to making sure the latest and greatest technologies are being tested and used, speed is a factor. Advanced marketers are often realizing by bringing many of these activities in-house, it is much easier to increase speed – it is also much easier to retain the talent that can execute in the manner necessary to succeed.

The above instances and the overlying data are something for marketers to be aware of and agencies to be concerned about, but, like with most changes this is not a black and white scenario. With agencies, similar to most marketing organizations today, it’s about reinvention. My colleague Gerry Murray, outlines some of this reinvention that IDC expects to happen within the agency (or more specifically marketing services) world in his latest blog post, Marketing as a Service (MaaS): The next wave of disruption for marketing tech. Ultimately, the vendors that continue with business as usual, relying on media buys or traditional agency/client relationships, risk stagnant digital revenue growth and an outdated offering.

What success are you seeing within your “in-house marketing team” and how are you continuing to leverage your agency partners? I would love to hear your opinion in the comments below or by reach out to me on twitter @SamMelnick.

The tech buyer's influence, while still important, is comparatively waning.

A successful shift to a business-buyer approach will accelerate if you understand what's behind it.

Front office automation has more business risk than back office automation. The 2nd Wave (as IDC calls the client-server era) was mainly about automating things inside your company. The 3rd Wave (as IDC calls the current era of cloud, mobile, social, and big data) is about automating your connections to the outside world (I call it the company "skin"). When tech problems happened deep in inside your company, it was frustrating but not devastating. The worst business tech problem of the 2nd Wave was being too slow to adopt new technology leaving competitors or upstarts to sail past you with business process advances. That problem is still a concern today. However, add the horror of screwing up in front of customers, investors, influencers, indeed, the whole world! Just ask the CEO of Target. Business executives are forced to pay attention to technology today – whether they want to or not. IDC forecasts that business executive budgets for technology will outstrip IT budgets.

Technology is easier and prettier now. Back in the day it took a real expert to understand the ins and outs of information technology products. The products were intimidatingly gray and beige and filled with exposed wires and chips. They hummed, got hot, and sparked out with regularity. No wonder the finance and marketing execs wanted to leave those suckers alone. Now most of those wires and chips are moving to the "cloud". Doesn't that sound nicer? Devices you touch are smooth and have pictures. Better design makes technology 99% invisible (to quote the title of one of my favorite podcasts).

Business executives are smarter and more confident about technology. Back in the day, technology was a startling thing that business people in the prime of their careers had never seen, much less used. I remember one intelligent, capable, and admired, C-suite executive who used to have his administrative assistant print out his email because he wasn't quite sure how to use it. Now, anyone younger than 60 came of age with PCs and programmable everything. Information about technology is available at everyone's fingertips and accessing opinions from your professional network is incredibly easy. While a portion of the population will always be skeptical or frightened about the next new thing – it's not likely to be IT that they are scared of (drones, anyone?).

Here are some steps you can take to accelerate the shift to a business-buyer focus:

Bring focus on the business decision-maker up to par with the technology decision-maker. This is the Goldilocks strategy – not too much but not too little. For most new tech installations, IT will no longer instigate nor approve nor pay. However, at some point the business executives will want to bring in their IT partner to take over some aspects of the decision. Keeping adjusting your investments in content, campaigns, training, etc. until you've reached a balance in results. Because this is a change you will have to overinvest in activity to achieve new results.
Take clues from the shifts described above. Focus value propositions on front office business problems. Build in cloud, mobile, social, and big data messages and capabilities (IDC says 90% of IT growth is coming from these areas). Make the "ugly" of tech 99% invisible – in your customer engagement, your sales discussions, and in the products themselves. But that doesn't mean be fluffy. Much of what is called "thought leadership" is astonishingly useless. People are trying to solve real business problems.

The worm has turned as the saying goes. We are never going back to the old way. Tech companies who succeed will be the ones to step up to investments they need to make to serve the empowered business buyer.

Copyright 2011 IDC. Complete articles may be reposted. Reproduction in part is forbidden unless specifically authorized. All rights reserved. Please contact IDC for information on republishing or web rights.

Why Business Executives are the New IT Buying Center

May 14, 2014/in Marketing /by 3 Created

Several times a week the IDC CMO Advisory Service gets inquiries from tech company clients about how to shift their company mindset to a new and different buyer. IDC’s IT Buyer Experience Study shows that business buyers have 53% of buying influence in the earliest part of buyer’s journey and their influence stays high throughout the entire process. The tech buyer’s influence, while still important, is comparatively waning.

A successful shift to a business-buyer approach will accelerate if you understand what’s behind it.

Front office automation has more business risk than back office automation. The 2nd Wave (as IDC calls the client-server era) was mainly about automating things inside your company. The 3rd Wave (as IDC calls the current era of cloud, mobile, social, and big data) is about automating your connections to the outside world (I call it the company “skin”). When tech problems happened deep in inside your company, it was frustrating but not devastating. The worst business tech problem of the 2nd Wave was being too slow to adopt new technology leaving competitors or upstarts to sail past you with business process advances. That problem is still a concern today. However, add the horror of screwing up in front of customers, investors, influencers, indeed, the whole world! Just ask the CEO of Target. Business executives are forced to pay attention to technology today – whether they want to or not. IDC forecasts that business executive budgets for technology will outstrip IT budgets.

Business executives are smarter and more confident about technology. Back in the day, technology was a startling thing that business people in the prime of their careers had never seen, much less used. I remember one intelligent, capable, and admired, C-suite executive who used to have his administrative assistant print out his email because he wasn’t quite sure how to use it. Now, anyone younger than 60 came of age with PCs and programmable everything. Information about technology is available at everyone’s fingertips and accessing opinions from your professional network is incredibly easy. While a portion of the population will always be skeptical or frightened about the next new thing – it’s not likely to be IT that they are scared of (drones, anyone?).

Here are some steps you can take to accelerate the shift to a business-buyer focus:

Bring focus on the business decision-maker up to par with the technology decision-maker. This is the Goldilocks strategy – not too much but not too little. For most new tech installations, IT will no longer instigate nor approve nor pay. However, at some point the business executives will want to bring in their IT partner to take over some aspects of the decision. Keeping adjusting your investments in content, campaigns, training, etc. until you’ve reached a balance in results. Because this is a change you will have to overinvest in activity to achieve new results.
Take clues from the shifts described above. Focus value propositions on front office business problems. Build in cloud, mobile, social, and big data messages and capabilities (IDC says 90% of IT growth is coming from these areas). Make the “ugly” of tech 99% invisible – in your customer engagement, your sales discussions, and in the products themselves. But that doesn’t mean be fluffy. Much of what is called “thought leadership” is astonishingly useless. People are trying to solve real business problems.

Measuring Sales and Marketing based on Customer Outcomes

April 16, 2014/in Marketing /by 3 Created

Have you ever used Uber X, the freelance taxi service? Half the cost of a cab and twice the level of service. The cars are immaculate. The drivers are almost overwhelmingly nice. They care deeply about your experience. Not because they want a tip. They want your 5-star feedback. That’s so important to their success that they will do almost anything to make sure you are happy. It is a customer first model that works because customers have the ability to give feedback that has direct business impact. It’s the eBay model applied to real world human interaction.

Think of your salespeople as Uber drivers, they interact with customers every day. Your marketing is like the car – is it in the right place at the right time and taking the customer where they want to go? These things matter tremendously to customers and yet we have no means to empower them to drive the behavior of marketing and sales at the moment of engagement. We have customer satisfaction surveys. They are important but lack immediacy and context for sales and marketing.

I recently came across two articles that may be the proverbial starting gun for measuring customer focus. The first from the HBR blog, “Bonuses Should be Based on Customer Value not Sales Targets,” profiles how GlaxoSmithKline no longer calculates sales bonuses based on prescription drug sales but on a basket of metrics related to patient outcomes. The second on the Forbes blog, “The 5-Star Employee, Why we need a Yelp for Business” presents a provocative picture of why employee ratings should be standard practice.

Clearly there are cultural and generational issues at stake and a lot of education needed to make these transformations acceptable and actionable in a way that improves outcomes for everyone. As customer facing technology coalesces around the CX Cloud model, marketers should think about how to get customer feedback more frequently. It will require innovation born of experimentation. Of course, no one wants to rate every piece of collateral. But maybe every third touch or at specific points in the nurturing process. Companies that figure it out will have the great advantage of being able to monitor customer experience and course correct in flight as opposed to relying on satisfaction surveys that are too little too late. Best of all, customers will feel the power of the relationship, something they won’t get from traditional models. Uber X is not better just because it costs less, it delivers more at the same time.

The one framework your CMO must share with your CIO

March 10, 2014/in Marketing /by 3 Created

So many marketing solutions are available that it is very difficult for marketers, chief digital officers, and CIOs to have a holistic view of what they have, what they need and why. IDC has recently created a tool to help – The 2014 Strategic Framework for Marketing Technology. This tool provides a visualization of the different technologies needed to support different marketing organizations no matter how small or large, digital or non digital, modern or not. Pictured below is the whole map which presents solutions in four broad categories:

Interaction: The primary function of these solutions is to be customer facing
Content: The primary function of these solutions is to facilitate the production and management of marketing content
Data and Analytics: The primary function of these solutions is to store and produce insights from customer, operations, and financial data
Management and Administration: The primary function of these solutions is to provide internal communications, workflows, budgeting and expense tracking.

IDC’s Strategic Framework for Marketing Technology

v1.0 = 78 categories

We have found that the complexity of technology requirements can be defined around a few factors:

Company size
Business model (eComm, B2C, B2B direct, B2B indirect)
Vertical industry
Mission of marketing (awareness, demand generation, etc.)

Using these factors, the map can be easily customized to show the current state, recommended next steps, and long term vision for just about any marketing organization. If you’re a pure eCommerce company the advertising and digital commerce areas will be much more important and sales enablement would disappear. If you’re a B2B direct company digital commerce might be a very low priority and sales enablement would loom large in your plans. Regardless of whether you’re CPG, Health Care, Financial Services, startup or global enterprise, we can build a map to get your marketing, IT, and executive teams on the same page with respect to your marketing technology requirements.

For more information on our framework and the services we offer around it, please contact me at gmurray (at) idc (dot) com.

Top 3 customer experience challenges for marketers

February 13, 2014/in Marketing /by 3 Created

Customer experience management is fundamentally about providing a seamless and consistent flow as prospects move through different phases of development and points of contact with a supplier. Delivering on this presumes a level of connectedness that many marketing organizations struggle to achieve. The reason for the struggle is that there are three significant forces of fragmentation opposing their efforts: specialization of roles, organizational hierarchies, and tactical technology. These forces threaten every marketing organization with two fatal flaws: they slow everything down and fracture the customer experience.

Three forces of fragmentation that marketers must fight:

1. Specialization: all areas of marketing execution have become inch wide mile deep endeavors. As a result, there can be many degrees of separation between key roles such as social marketers, event planners, web administrators, technical writers, etc. What do these people talk about when they get in a room together? Does anyone else care how the events person manages food service or logistics?

How to combat the fragmentation of specialization: It is becoming clear that the one thing all marketing roles now have in common is the need to master data and analytics. Each specialized role produces and consumes data from all the others. It is critical that everyone in marketing understand how customer and operational data flows, how others use the data they produce, and the best analytical practices for gaining insight. This should be a key topic of conversation and community building.

2. Hierarchical org charts: Marketing is no longer a command and control world. Yes, there is an overlay of reporting that has to go “up the chain.” For many marketing leaders that grew up with the traditional B-school approach to management, adding layers to the org chart is a natural approach. However it results in compartmentalization that left untended creates a culture of disconnectedness.

How to combat the fragmentation of hierarchies: Marketing organizations should be defined around processes not activities. Marketing processes must be supported by collaborative environments that foster greater visibility and coordination between contributors. Enterprise social networks are becoming essential for creating a culture of openness and connection. Organic approaches are not enough, marketing leaders need to seed the social network with process oriented communities such as: campaign management, sales enablement, content lifecycle management, etc.

Transforming Marketing From Silos…

… To Systems

3. Technology: IDC identifies nearly 90 different categories of marketing technology (not including middleware and infrastructure!) That alone should tell you the function and the IT market serving it are unsustainably fragmented. The deployment of highly specialized tools can empower people within their specialties but can leave them on a technology island in the greater scheme of things. Major IT vendors have started to consolidate some of the basic building blocks, but there are still many areas in which niche/best of breed capabilities are needed.

How to combat the fragmentation of technology: The two centers of gravity for your marketing IT infrastructure are your integrated marketing management solution and your website. They should be intimately tied to each other and all other marketing systems/tools should integrate with one or both of them. This becomes a forcing factor for integrating processes and data flows. Marketers also need to demand more of their technology vendors to accelerate the evolution of platforms that tie together the systems of engagement, content, administration and data.

The most successful CMOs will ensure the pervasive deployment and adoption of technology increases collaboration, socialization, and systems thinking. They will design marketing organizations around customer-centric processes and exert deliberate efforts at all levels to combat the forces that threaten the connectedness needed to serve up a seamless customer experience.

2014: The year of Digital Marketing…Wait a Second, What Exactly is Digital Marketing?

January 3, 2014/in Marketing /by 3 Created

Or maybe 2014 will be the year of mobile, or the year content marketing. Ok, Ok, I can guarantee one thing, 2014 will be the year of the horse.

While 2014 might not be the year of digital marketing, digital will continue to be deeply important to the marketing organization. As digital spend continues to increase, the focus grows. Despite this, there can be a lack of clarity around the topic. What exactly falls within digital marketing? How much budget is actually being spent on digital? And how does it all meld together?

Let’s dive in.

Digital Marketing Budget Trends:

From 2009 to the end of 2013 digital marketing program spend has increased from 13% to 34% of the total marketing program mix. For 2014 IDC’s CMO Advisory Service expects this to increase to 39% and to 50% in 2016 (highlighted within Kathleen Schaub and Rich Vancil‘s IDC Chief Marketing Officer (CMO) 2014 Predictions). While this level varies depending on sector and size, the upward trend is clear.

What is Digital Marketing:

At this point all marketers agree that digital is important. That is all well and good, but without a consistent definition around the topic, digital marketing may mean different things to each person or organization. To be successful in building a digital marketing practice, having clear definitions is imperative. This will drive consistency throughout the organization leading to proper tracking and staff allocations. Below is IDC’s definition of which marketing programs fall within “digital marketing.”

For specific definitions for each area please view IDC’s Worldwide Sales, Marketing, and Market Intelligence Taxonomy, 2013.

Digital as an Organizational Practice:

Defining and tracking digital marketing is important, but the modern marketer understands it must be executed in orchestration with the full marketing strategy. A key guidance for 2014 is to create “systems not silos.” In short, rather than creating another walled practice within marketing (think, advertising vs email marketing, vs events), make digital an organizational practice that spans across all tactics and staff. Separating digital and non-digital marketing will create more complex challenges for the organization. Avoid this approach and make digital a strength across all of marketing.

3 Take Aways:

Digital marketing spend is growing, FAST, it will be 50% of the (multi-billion dollar) B2B tech marketer’s program budget by 2016.
Work to define digital marketing so everyone in the organization is speaking in the same terms.
Do not separate digital from the rest of marketing, it is too important to sit on an island.

Now it’s your turn, what are you planning to do within digital marketing for 2014? What other suggestions do you have for your peers? What did I miss?

Follow Sam Melnick on Twitter: @SamMelnick

Cross Training for Marketing

December 11, 2013/in Marketing /by 3 Created

Most marketing organizations are organized around a set of silos based on specialized program functions within branding or demand generation. The skills, tools, and relationships needed to manage advertising, events, email, website, social, video production, technical writing, etc. are very different. The pressure and complexity involved in each area can easily turn them into organizational islands. They may each have their own databases, audiences, and reporting structures. They may be further fragmented when replicated across business units and geographies. While specialization is necessary and will only increase, the fragmentation and separation that typically accompany it can break down the customer experience, introduce inefficiencies and redundancies, and slow down the whole marketing operation.

The challenge is how to make strong sustainable connections between specialists so that new competencies can be acquired without the negative side effects. Data management and analytics have emerged as two key skills common to every marketing activity. These topics are ideal for bringing marketers together to share how each of their areas produces and consumes data and the models and tools they use to gain meaningful insights. IDC recommends marketing organizations conduct regular analytics knowledge jams to share competencies, resources, and insights. To cross train them on the many other functions that affect customer creation. Key objectives include:

Provide visibility into how data is produced and consumed in other areas
Improve data capture, quality, and usability
Socialize important analytic models
Provide a more holistic perspective on the customer experience
Raise the overall data and analytics IQ of the marketing team

In each session, representatives from different groups share 15 minute presentations of what they are working on and how they use data and analytics. This will help combat the fragmentation brought on by specialization, reduce inefficiencies and redundancies, and make marketing more responsive.

2013 Tech Marketing Budget Trends: 3rd Platform Companies and Products Lead the Growth

October 3, 2013/in Marketing /by 3 Created

Yesterday, IDC’s CMO Advisory Service had our annual Tech Marketing Benchmark Webinar. This study goes out to close to 100 senior lever marketing executives and represents the largest B2B Tech companies in the world (this year the average company revenue was $9.1B.) The webinar was packed with great information and was a great success. However the overlying question each year is where will marketing budgets sit at the end of the year and what direction are they moving. The results are some good news mixed with trends that point to hard work that marketers need to do around their budgets.

Good News: More Organizations are Increasing their Marketing Spend Than Decreasing

As seen in the graph below, across the entire tech industry a net of 15% of companies are increasing marketing spend versus those decreasing. While it may not always feel like it, there are marketing budget increases out there to be had!

Challenge for Marketers in 2014: Finding the Right Areas that Should Receive More Marketing Budget

Despite the fact more companies across the tech industry are increasing marketing budgets than decreasing, budgets at the aggregate levels are flat to slightly negative. IDC expects Marketing budgets to decrease 0.5% year-over-year from 2012 to 2013. So that leaves us with an interesting juxtaposition, more companies are increasing budgets than decreasing, but at the aggregate weighted level the data shows a slight decrease in overall budgets. Three reasons we are seeing this:

The largest companies within the Tech Industry are seeing flat to declining marketing budgets due to continued transformation within the industry. This brings the weighted levels down.
Hardware companies (as seen in the above graph) are the only sector where more companies are decreasing marketing budgets than increasing. Companies within this sector are typically larger and the Hardware industry is feeling more affects from the industry’s transformation.
3rd Platform companies and other high growth product lines and business units are driving much of the revenue growth and in turn are receiving much of the increases within marketing budgets. These companies are smaller, so they add the “n” value of companies increasing, but do not affect the weighted average as heavily.

Illustrating the final point (#3) you can see in the graph below that Cloud Software Vendor’s (who are right smack in the middle of IDC’s 3rd Platform) Revenue Growth, Marketing Investment Growth, and Marketing Budget Ratio (total marketing budget / total revenue) are all at least 3X that of their on-premise peers. Some of this can be attributed the size of the Cloud Vendors (typically smaller), but the growth being seen in the 3rd Platform areas is undeniable.

Note: If you would like to discuss cloud vendors marketing benchmarks further please email me at smelnick (at) idc (dot) com!

In closing the 3 budget takeaways we are giving for budgets in 2013 – 2014 are:

More companies are increasing (vs. decreasing) marketing spend. (This is good news!)
There is not enough “Peanut Butter” to go around… (so an even spread will not work this year)
Marketing Investment will inevitably find growth areas: products; markets; segments; or geos. (So, work hard to find those areas and invest wisely)

Sam Melnick is a Research Analyst at IDC’s CMO Advisory Service and manages the entire benchmark survey and study. You can follow him on twitter at @SamMelnick

Sales process – the missing ingredient for marketing ROI

October 2, 2013/in Marketing /by 3 Created

Most marketers in B2B enterprises have never been trained on sales process. If I were running your marketing or sales organization this would be the first thing on my agenda. Why? Because without understanding sales process, marketing is essentially set up to fail. How can anyone improve or contribute effectively to something if they don’t know how it works. It’s like setting up your manufacturing to produce blue widgets but not telling your suppliers what parts you need for your particular widgets. So they ship you tons of blue stuff and hope that somehow it all works out. That’s the position, to one degree or another that most enterprise marketing organizations are in even at some of the most advanced process-centric companies in the world. Largely because they have chopped up the customer creation process into a collection of departmentally independent activities.

In a large enterprise with many products lines, business units and segments, there are likely to be a number of different sales processes. Marketing and sales resources should be aligned against these processes horizontally. This is the key to making the shift from a siloed command and control organization to a responsive, integrated customer focused one. Not only is it important to design around sales process, which should be designed around the buyer’s journey, but it is important to design for change. Markets are dynamic and sales processes change.

Marketing automation systems, especially those that are integrated with the sales force automation or customer relationship management system, have begun to provide marketing with some clues to sales process. At least they can see what happens or does not happen when they deliver something to sales. But the data does not always explain why, and that’s the critical part. Marketing needs to understand very specifically how Sales operates in order to optimize around customer outcomes. The alternative is for marketing to optimize around departmentally focused KPIs like the number of MQLs (ugh), or SALs, or worse vanity metrics like hits, sentiment, likes, etc. These metrics are useful indicators for some marketing activities, but not as business drivers for marketing investment.

Aligning marketing and sales around sales process is the first step to formulating an enterprise customer creation process that extends across all customer touch points, including: billing, fulfillment, service and support. At each stage of maturity, marketing, as well as all the other customer facing departments, gain much greater visibility and accountability to the whole process and its connection to corporate objectives for growth, market share, and margin. This is all necessary for a true picture of marketing ROI.

Your action items:

Marketers: lobby your top executives to make regular sales process training for marketing a priority.
Sales executives: demand that marketing know how the different parts of your sales force work so they can more effectively develop prospects and serve customers.
CEOs: get smart about your customer supply chain by applying the same level of due diligence and process discipline to it that you have to your product and services units. As a result, you will make much more effective use of marketing investment and be able to hold your whole customer facing team accountable for its contribution to your strategic objectives.

Create and Close Customers up to 40% Faster

August 30, 2013/in Marketing /by 3 Created

IDC’s CMO Advisory has conducted an annual IT Buyer Experience survey for the past six years. We have tracked many changes and interesting trends, but one thing stands out as a consistent inefficiency in the market: every year IT Buyers report the purchase processes can be approximately 40% shorter. Over the course of a 10-month average process that means the potential is to accelerate revenue by an entire quarter. This is a huge opportunity for both buyers and sellers with tremendous financial incentives for both and yet no improvement in six years. Why not and what to do about it?

Buyers put about 2/3 of the blame for this inefficiency on themselves. There are scheduling issues, conflicting agendas, changing budgets, changes in personnel, immature purchase processes, etc. The challenge for vendors therefore is two-fold:

Reduce the inefficiencies that are inherent in their own marketing and sales processes, and
Better facilitate the buyer’s process(es)

Gap between actual and ideal IT purchase processes, 2009-2013

To do this, vendors need to intimately understand the Buyer’s Journey. It starts with Exploration, moves to Evaluation, and ends with a Purchase. Buyers spend the most amount of time in the Exploration stage, largely independent of direct vendor interaction. As they move through each stage, their agendas change dramatically and the process accelerates. Buyers spend less time in each subsequent stage and have higher expectations of vendor response times. By carefully defining and monitoring buyers’ journeys, marketing and sales can better serve customer needs, keep pace with buyer expectations, and cut out big chucks of inefficiency.

For example, in the Exploration stage, the buyer’s main objective is to establish fit between their business challenges and a solution. The main resources they use are related to trends in their industry. The primary internal influencers are business buyers (functional leaders, business unit mangers, and executives.) Once they enter the evaluation stage, however, their objective and trusted sources change completely.

In our report, IDC CMO Advisory 2013 IT BuyerExperience Survey: Create and Close Customers up to 40% Faster, we outline specific steps IT marketers should take at each stage in order to get the right messages to the right decision makers. For more information, please contact me at gmurray (at) idc (dot) com.