How end user revolts impact startups’ analyst lists [Startup Saturday]

rocket-for-startups.jpgBack in the 90’s I used the concept of “end user revolts” extensively when doing speeches at Gartner events. The idea always got approving nods of the head from the throngs of IT managers in the audience because most thought that end users were pretty revolting. However, I pretty much stopped using the talking point after leaving Gartner for KCG and then launching SageCircle.

Fast forward to today and it is apparent that the end user revolt is a critical concept that applies very much to vendor AR teams trying to build analysts lists. The group of vendors most impacted by these revolts is startups. Startups should be paying closest attention to revolts because startups are likely supplying the corporate rebels with the tools of their revolts.

The end user revolt was a concept I coined (at least I think I came up with it) to describe the push-and-pull between IT organizations and their internal clients. It goes like this:

  • In the 1970’s, end users were tired of the DP department hoarding data and processing power in the mainframe glass houses, so they went out and bought the new fangled minicomputers to have their own tools
  • By the mid-1980’s, MIS had institutionalized the minicomputer, so end users sick of MIS hoarding data and computing power went out to buy the new fangled personal computer and later added LANs to have local access to computing
  • By the mid-1990’s, IS&T had institutionalized the PCs and LANs, so end users sick of IS&T hoarding access to all internal computing power started to adopt the Internet and World Wide Web, setting up company websites to communicate directly with customers and prospects
  • By the mid-2000’s, IT had institutionalized the company website setting up new rules and restrictions so end users revolted again, turning to hosted social media tools to once more talk directly to customers and prospects

In each of these revolts, it was the end users that initialed the acquisition of emerging technologies and techniques, not the IT departments. This makes sense because most IT organizations are mandated toward managing costs and risks of the IT infrastructure rather than pushing the edge of the envelope. In the last two revolts it has been mostly the marketing departments who have really pushed into emerging technologies.  They are seeking technologies and processes that enhance their ability to touch and interact with prospects and customers to build brand awareness, generate leads, and drive revenues.

The implication for startups is that focusing on analyst firms that primarily advise the IT organization might be the wrong move. Rather than obsessing over getting a briefing with Gartner, the 900 pound gorilla in the CIO/IT market, startups might want to check with early customers about who they use as advisors. Perhaps it is Forrester, a firm that gets a lot of its business advising the enterprise CMO and marketing department. Alternatively the advisor might be Jupiter or one of the many other boutique firms that specialize in Internet technologies. Or it may not be a traditional analyst at all, but a blogger/consultant.

Bottom Line: When deciding which analysts to brief it is important to focus those that are relevant to your market, prospects and customers. When the buyer is outside of the IT organization, then it is necessary to look beyond the analyst firms that specialize in advising the CIO and their department. Startups in emerging markets need to take care when putting together their analyst lists to ensure they are targeting the right analysts.

Question: Buyers of social media tools and other emerging technologies – Which analyst firms do you rely on for advice and information? Startups – Do you ask your early customers about where they get their information and advice?

How SageCircle can Help: If you need advice about how to identify which analysts to put on your analyst list, check out SageCircle’s two-hour and five-hour advisory paks or Annual Advisory Service. The advisory paks are easy to setup and pay for via credit card. We can help you by:

  • Reviewing your current analyst list
  • Providing techniques for generating an analyst list
  • Brainstorming on what characteristics of your market point to which group of analysts

For more information, visit our website or contact us at sales [at] sagecircle dot com or 650-274-8309.

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2 Responses

  1. Hi Carter,

    Interesting post. One other way of looking at this is to differentiate between “IT products” and “Business Services” and seeking out analysts who have a “product” or “service” perspective to their coverage area. An analyst who covers, for example, data integration tools, is likely to rarely venture outside of his/her area, as opposed to a consulting services analyst (example), who is likely to cut into the world of the COO, CFO etc and have a broader outlook of business issues. As you know better than anyone, simply getting to know who the personalities are, whether they are analysts, bloggers, consultants…the people with whom the network, and capability to “influence” is key.

    Phil

  2. Hi Phil, Thanks for the comment. Excellent points. You are dead on about getting to know the individuals and what they are up to. That is why we always say to rank the individual analysts and not firms. Cheers, -carter j

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