Tag Archives: channel marketing

Traditional lead generation model

19 Apr


The Myth of selling/marketing to the CIO in SMB

12 Apr

The Myth of selling/marketing to the CIO in SMB

(My definition of SMB = any company with less than 1,000 employees.)

There are approximately 17,000 companies globally with more than 1,000 employees. We only start to see the traditional role of CIO’s appear in the enterprise space (1,000 + employee orgs). There are few exceptions of course but not many.

IT vendors who have any interest in marketing/selling tech products to the SMB (regardless of direct/channel models) will have a very hard time time selling software/hardware/cloud products and services to “the” CIO. (He/she simply isn’t there in the majority of companies in this space) There will of course be a few exceptions but not enough to base your selling and marketing strategy.

For clarity here is a breakdown by market segment and general IT:

The Consumer Market: 1 – 10 employees

They tend to purchase products from the mass retail outlets or online retail stores and then look for family or friends to help them set-up and maintain their computers/networks. MSPs and IT service providers occasionally show up.

The S of SMB Market: 10 – 250 Employees

They have small IT budgets. They lack the buying power that larger companies have. This group typically relies on MSPs and VARs to compliment/run IT for them. Typically, these SMBs don’t have a large IT department (mostly between 1 – 5 IT pros if that). They purchase a large amount of all products through VARs/channel partners. They trust their partners and have very strong relationships with them. However, IT vendors need to generate demand upstream/downstream and get their brands on the lips of IT buyers.

The M of SMB Market: 250 – 500 Employees

They have slightly larger IT budgets. Typically, these SMBs have an IT department of 1-10 folks. We start to see VP of IT but still require expertise in depth. They purchase a large amount of all products through VARs/DMRs. They trust their VARs and have very strong relations with them. When they ask their VAR what products/brands they should purchase they usually go with the VARs’ recommendations. However, IT vendors need to generate demand upstream/downstream and get their brands on the lips of IT buyers..

Mid-Market: 501 – 1,000 Employees

They have slightly larger IT budgets than the previous group. Typically, these SMBs have an IT department of 1-10 folks. We start to see VP of IT, CIO, Server, Network but still require expertise in depth. They purchase the majority of products through VARs/DMRs with specific solution orientated practices. However, IT vendors need to generate demand upstream/downstream and get their brands on the lips of IT buyers..

Enterprise Market: Over 1,000 Employees

The “Enterprise” market. The big boys, easy to know, easy to find. Most IT vendors focus on this space. See CIO, CISO, CTO and large IT departments. Enterprise CIOs tend to work directly with Vendors and negotiate price, service levels, etc.

What do to:

Even as IT organizations grow (in staff and responsibilities) the decision makers are “downstream” and are where you want your brand to be. Yes, the CEO, COO and sometimes the CIO is the one that writes the check but always remember this: The IT department may not have the power to say yes, but they most certainly have the power to say no. Focus on the myth of the CIO decision maker and your sales will suffer.

Do not neglect the IT department when marketing and selling technology products, services and/or solutions. Be sure to embrace and engage these critical influencers, while also marketing to the C-Level suite and then engage the IT department to support your sales and marketing efforts.

Don’t fall into this trap:

IT Marketer: “We are not interested in selling to the IT department, we market/sell to the CIO and it flows down from there.”

My opinion is irrelevant so I decided to ask 2 million IT buyers what they thought. I asked, ”As an IT salesperson or marketer, should I include the IT professional in my selling or focus on the CIO?” Here is a sample of responses:

What is a CIO? I am the IT guy for our 250 person law firm in Florida. Me and 2 other guys decide what to buy.

Most of us ARE decision makers…or at least TELL the decision makers what to decide. That’s how it works here.

Only marketing to the C-Suite is the move of someone who knows their product isn’t any good.

I think what so many vendors fail to realize is that while I, as an IT professional, am not the decision maker, I have two very important roles: decision influencer and gatekeeper. If a vendor doesn’t convince me, they don’t make it to the decision maker…and can make or break most IT decisions.

If it is budgeted, I am the decision maker. I make the IT budget, decide what gets in and does not. It gets approved. Then I order.

Social IT Marketing and the Channel

10 Apr

As more and more tech buyers turn to social networks to share and research information on IT products and services it’s having a significant impact on the technology distribution models born out of the 1980’s and 90’s. The typical way tech brands reached IT buyers was to recruit distributors and VARS and then hope they could sell products to as many customers as possible. In fact, manufacturers had no direct marketing initiatives of their own in place, relying solely on partners for marketing and sales.

The channel is obviously still an important part of the go to market strategy for IT vendors. However, with the rising influence of social networks on the technology research and buying process the linear, command and control mentality is gone forever.

Without the ability to participate in social discussions about their products and services vendors are taking a big gamble thinking the ”channel” will simply do the selling for them.

A great example of this shift can be seen among 1.7 Million IT professionals in the Spiceworks social network. They constantly tell me, “We want to engage with the technology vendors on our terms and turf. We will happily purchase products, services and solutions from resellers but it’s nice to ask the vendor a direct question every now and then.

If you are a vendor or reseller looking for ways to ensure your properly engaging IT buyers in social networks to complement and support your existing channel sales , here are some simple steps you can take:

  • Have a real, ongoing presence in the social networks where your customers and potential customers hang out and do their job.
  • When engaging customers in social networks be authentic and helpful.
  • Engage customers and potential buyers on their terms whether that’s providing a whitepaper or answer a question in a forum.

For the channel relationship to prosper in today’s shifting social media landscape, both technology vendors and their resellers have important roles to play. Both can participate in the customer – driven conversation, which will help ensure their meeting customer’s needs in the new social buying process.


10 Apr

One of the major problems at technology start up’s today is the lack of understanding of how much sales and marketing principles have changed.“If I need to double revenue growth, I need to double my sales force to drive it” or “I need to generate 1,000 leads to generate one sale. Therefore 2,000 leads will generate two sales.”

This does not make sense and management teams are confusing correlation and causality. A vendor who believes in this may as well claim, “Christmas trees cause Christmas.”  The majority of technology start up management teams are still under the influence of the 1980’s and 1990’s mind set. Sales and marketing has changed so much that it is amazing. The problem today: Not generating enough qualified pipeline and sales to hit and exceed estimated revenue targets.

Here are the two major root assumptions among executives, founders and VC firms that cause the majority of the problem:

1.  I need to double my revenue, therefore I need to double my sales team, and
2.  Salespeople can find new business on their own

No they won’t. They may find some but not enough to feed themselves. Here’s why:

1. Salespeople are terrible at prospecting. Sometimes it has takes 30 – 40 attempts to break into a company and qualify a brand new opportunity.  Salespeople usually stop after 4 – 5 times.

2. Salespeople hate to prospect and do the upfront work to drive demand. Salespeople want to sell – not drive demand.

3. Even if a salesperson does some prospecting, as soon as they generate some pipeline, they become too busy to prospect. It is not sustainable. This is why ramp up times are so much longer than anticipated.

Salespeople do not cause customer acquisition growth, they fulfill it.

It’s a huge shift in thinking. Of course a company needs more salespeople if they are getting bigger, but this is not the main cause of new customer growth. Marketing, awareness, demand generation and engagement causes new customer acquisition and sales fulfills that demand generated by marketing. There aren’t any quick fixes to this problem. However, there are ways to solve this. I have outlined, in brief, a few ideas below for you to consider.  These are especially important for companies with a high volume sales model.

1.  Trial-and-error in awareness, demand generation (requires patience, experimentation, money) MUST be a true combination of sales and marketing team working together. I jokingly call this SMARKETING but it works.

2.   Use CRM religiously and track, track, track.

3.  Have patience in building great word-of-mouth.  This is the highest value lead generation source, but the hardest to influence.

4.  Create a well supported sales development team with resources.  This is by far the most predictable source of pipeline, but it takes time and focus (ties in to point # 1.) This is the BEST indicator of pipeline generation in the short term. We did this at a previous company and took the business from $1.25 million to $6 Million.

5.  Use PR & Social media outreach on a consistent basis.

6.  Find the right network.

7.  Target social networks that are relevant.

8.  Listen.

9.  Engage.

10.  Track results.

11.  Calculate the amount of qualified pipeline your company needs to generate on a monthly basis? Most start up’s do not know this.

The Reality of the IT buying Process

10 Apr


%d bloggers like this: