For IT managers – It’s “Praise Your Vendor” Inquiry Day

Now for something completely different… offering the analysts a vendor compliment in lieu of a complaint. Advisory analysts at the largest firms (e.g., Forrester and Gartner) build their opinions based more on client feedback than on research evaluations. They generally do not do lab analysis or specific competitive research.  That means that the perceptions they have of the products may be more highly colored by negative customer comments heard during client phone-based inquiries than reality would suggest. 

SageCircle Technique:  Our suggestion to IT managers is that you

Saving money on contracts with the Forrester / Gartner duopoly is not simple

A common client inquiry we receive is in the context of someone negotiating with Gartner. Our clients want to know why in the midst of a terrible economic downturn, when vendors are cutting budgets left and right, that Gartner does not exhibit greater flexibility (i.e., cut prices) when it comes to contract negotiations. The short answer is that due to its end-user advisory market dominance – we estimate that Gartner has ~70% of the end user contracts – it does not have to be flexible. 

However, this issue is a little more complex than slapping a “monopolist” tag on folks over on Top Gallant Road. The reality is that there is an effective duopoly with tacit partner Forrester which gives them both the flexibility to be inflexible with it comes to negotiations. The last time this market saw pricing and packaging that in anyway favored the buyer was the mid-90′s when Giga and later META used significantly lower prices and “all you can eat” research seats to take market share from Gartner and Forrester. Alas, today there are no such firms that can play that role to counter Gartner and Forrester. As a consequence, the Big Two’s CEOs habitually inform Wall Street that they are maintaining their pricing and discounting discipline.

However, it is possible to reduce spending – notice we did not say “save money” – with the Forrester / Gartner duopoly without damaging the ability to access analysts for influencing purposes. However, it is not as simple as trying to wrangle a better discount from the sales rep. Rather it takes:

• Knowledge about the firms’ business models
• Knowledge about the firms’ research methodology and analyst culture
• Knowledge about the true business value of

Access to those with access – One reason why end users buy analyst advisory subscriptions

Social CRM: When Registration Pages Go Extinct is an interesting post by Forrester analyst Jeremiah Owyang (bio, Twitter handle) on his Web Strategy by Jeremiah blog. However it is not the content of the blog overall, but a couple of throwaway lines that are relevant to analyst relations (AR) professionals:

“…I’m working on a report called the “Future of the Social Web” and I interviewed quite a few companies like Google, Facebook, Twitter, LinkedIn, Lotus, RWW, Federated Media, Plaxo, Dell, Cisco EOS, Flock, Meebo, Gigya, Intel, Razorfish, Six Apart, and a bunch more to find out the trends in this industry. There’s probably less than 10 people in the world that have access to all these teams, executives and thought leaders, and I’m taking advantage of it. …”

I don’t think that Jeremiah is bragging about his access, but rather it is his typical – and rare – transparency about how he goes about his job as an analyst. What is interesting is the number of vendors that Jeremiah has access to for his research. Because of this litany of access, Jeremiah’s factoid can be leveraged by AR as part of its executive sponsorship building efforts and spokespeople training.

One of the selling points that end-user advisory analyst firms (e.g., Gartner and Forrester) make to their enterprise IT manager prospects is that their analysts have access to top vendor executives and thought leaders in the industry. Furthermore, not only do they have access, it is part of their job to take the time to leverage that access. Savvy analysts are adept at name dropping when chatting with existing clients (it helps renewals) and when on a prospect call with one of the firm’s sales representatives. IT executives and IT managers value the analysts’ broad access to vendors – and their IT peers.   Analysts can provide an integrated point-of-view that the IT manager client does not have the time to develop themselves through conversations or reading blogs (see the related story Context, advice, reputation and time: How analysts can thrive in the social media age).

Positioning themselves as having superior access, and the ability to verbally apply this access to a client’s situation, has always been a differentiator of the advisory analysts versus

Gartner has a channel on YouTube

A quick reminder that Gartner periodically posts videos to the Gartner Channel on YouTube. Most recent videos are quick interviews with analysts and guest speakers at Symposium.

While not a source of in-depth insight into analyst opinion, these videos can provide both IT managers and vendor analyst relations (AR) professionals with interesting data points. Well worth following.

Industry Analysts: Too conservative for their own good?

Catching up on my analyst blog reading this morning and came across this gem from Vinnie Mirchandani in his Deal Architect blog.

In Industry Analysts: Too conservative for their own good?, Vinnie makes the point that analysts are not as tough in their written research as they are in conversation. Why? Vinnie says:

If they say negative stuff, vendors typically lobby, coerce and worse. Here’s the reality – the biggest customers of every industry analyst firm are vendors. Even the so-called buyer centric firms like Gartner and Forrester.

Vinnie’s advise is to

Analyst research can be obsolete or out-of-date the day after it’s published

In conversation with an AR manager we received an interesting question: “What is the shelf life of published research?”

Answer: Somewhere between fresh fish (goes bad in days) to a Twinkie (a quasi-food snack that is rumored to last for infinity).

Formal analyst publications, e.g., a research note, can have a long gestation period due to going through peer review, management review and editorial (mostly good things) and get stuck in email waiting for minor changes while the analyst is out of the office (a bad thing). As a consequence, some formal analyst research can be out-of-date the day it is published.

That is why clients, whether end user or vendor, need to critically review the research for “freshness” and leverage inquiry

How to use analyst market share numbers after Gartner makes a “huge mistake” with server market share numbers

Rarely do analysts call out another firm on perceived failures in research, but Rob Enderle does just that in Liars, Damn Liars and Statistics: Gartner Goofs on Server Numbers. Money quote:

“…However, the accuracy of these numbers even inside corporations (given how deals are accounted for) would suggest that getting within 5 percent of actual sales would be very difficult, let alone having a high level of confidence that under 1 percent actually signified real market leadership. …”

Rob then goes into an interesting discussion of the shortcomings of market share numbers and the methodologies used to create them. The article is well worth reading. It would be interesting – fun even – if more analysts engaged each other in the marketplace of ideas rather than having a monologue with clients.

SageCircle has long said that market share numbers from the market research analysts can provide interesting insights into the direction a market is going. However, relying on the numbers alone without

Why analyst relations matter – Analysts do not have time to do all-inclusive research

(After an interesting Twitter-based conversation with Illuminata’s Gordon Haff and former IDC analyst Ida-Rose Sylvester over the use of the word comprehensive, we have decided to use the word all-inclusive instead. )

One aspect of the analyst industry that is not widely known by technology buyers (aka end users, usually IT managers) and vendors is that industry analysts do not have the resources (e.g., time and travel budget) to conduct and publish comprehensive all-inclusive research about a market.  Advisory analysts gather most of their data from client inquiry and vendor briefings.  The major firms do not conduct product evaluations, lab tests against specifications, or quality of service investigations.

 This point was highlighted by Forrester analyst Jeremiah Owyang in Starting the Forrester Wave: White Label Social Networks and Community Platforms about some research he is working on:

 ”…I made a call for the vendor product catalog in this market, (and via email and twitter) that document is a detailed index of over 40 vendors in the space, (aprox 50% of the market) and will be available to Forrester clients…”

 ”…Due to the rigorous methodology … The Wave will only include several vendors.”

There are two key points here, one is that the vendor catalog is only a subset of the market and, two, the Wave will be a further subset of the vendor catalog the analyst assembled.

For vendors in this market these points should send a shiver down their spines. If they

For IT managers – It’s “Praise Your Vendor” Inquiry Day

Now for something completely different… offering the analysts a vendor compliment in lieu of a complaint. Advisory analysts at major firms build their opinions based more on client feedback than on research evaluations. They generally do not do lab analysis or specific competitive research.  That means that the perceptions they have of the products may be more highly colored by negative customer comments heard during client phone-based inquiries than reality would suggest. 

SageCircle Technique:  My suggestion to IT managers is that you

Using five rights to avoid a wrong when it comes to purchasing Gartner or Forrester services

You can minimize analyst firm price hikes by buying the right services from the right firms at the right price.  This post is the first entry in a series* that will discuss how buyers of industry analyst services can manage their analyst contracts and minimize the impact of price hikes on their budgets.

Since Gene Hall took over as Gartner’s CEO in August 2004, he has diligently worked to raise Gartner’s ASP (average selling price) by eliminating discounts, enterprise-wide agreements and competitors while instituting price hikes for legacy products and launching new premium services. Under the cover that Gartner offers, other firms – especially Forrester – have been raising their prices as well. While it is entirely the firms’ right to price their products as high as the market will bear, these price increases are putting a burden on clients’ budgets. As a consequence, IT managers and vendor market research buyers need to carefully evaluate their analyst services purchasing decisions to ensure that they are maximizing the return on their purchase.

There is the old saying in the US and perhaps elsewhere that “two wrongs do not make a right.” For this series, we are going to flip that saying around with the idea that “five rights avoid a wrong.” The right actions that analyst services buyers need to take are: 

• Right reasons – Evaluate why you are purchasing analyst services
• Right services – Align the services you buy to better match the

What is the business value of inquiry for vendors

SageCircle promotes the use of inquiry and we have offered suggestions on various topics for both Enterprise IT research consumers and Communications and IT vendors.  In general, vendors spend far less time doing inquires than they should.  This both decreases the business value they are receiving from the analyst contract and misses some important soft dollar benefits that are hard to achieve in other ways. Not getting value from the inquiry contract also contributes to the perception of some vendor executives that advisory analysts like Gartner and Forrester are “pay for play,” otherwise why spend the money on the annual contract.   In this post we will look less at the techniques and more at the realized benefits of a program of regular analyst inquiry.

Gaining real information

The stated purpose for inquires is to gain greater depth and understanding of an analyst’s research and opinions.  As always, you should review the currently published materials before scheduling a briefing.  However, inquiry can provide insights into an analysts’ work-in-progress and allow you to

Research consumer’s turn — How industry analysts can be better prepared for inquiries

For the most part the SageCircle blog concentrates how various members of the tech analyst ecosystem interact more effectively with the analysts (e.g., AR best practices and research consumer tips). This post is an experiment to give the community a chance to give a few friendly tips to the analysts.

SageCircle heavily encourages the use of inquiry for both communications and IT vendor AR teams and end-user client researcher consumers.  While most analysts are well prepared for inquires we have personally experienced and received comments from members of the analyst ecosystem about those analysts that might have needed a bit more coffee before getting on the phone. One not so amusing story is the analyst who could not discuss the research he had written, could not remember writing it and

For IT managers – It’s “Praise Your Vendor” Inquiry Day

Now for something completely different… offering the analysts a vendor compliment in lieu of a complaint. Advisory analysts at major firms build their opinions based more on client feedback than on research evaluations. They generally do not do lab analysis or specific competitive research.  That means that the perceptions they have of the products may be more highly colored by negative customer comments heard during client phone-based inquiries than reality would suggest. 

SageCircle Technique:  My suggestion to IT managers is that you

Using inquiry… Influence the analysts’ research agenda

We have repeated stressed the importance of inquiry, both from the role of the vendor and that of the research consumer.  Obviously it can be used to obtain information as well as inform the analyst.  Another aspect of inquiry is the use of it to influence the research agenda of an analyst or a firm on behalf of either IT clients or vendors.

From the IT client perspective it can be very valuable to align the research agenda in the direction of your specific research needs.  Analysts rate client inquiry highly in understanding the market direction.  Your questions and observations, coupled with those of other clients, often cause shifts in the planned

Common mistakes made when using market share numbers from industry analysts

Market share numbers from the market research analysts can provide interesting insights into the direction a market is going. However, relying on the numbers alone without understanding how they are created or the assumptions that went into their research can lead to the wrong conclusions

There are a variety of common mistakes that market research consumers make. Consumers of market share numbers need to be aware of these types of mistakes and

Potential analyst inquiry topics for IT and communications vendors

SageCircle constantly recommends that communications and IT vendors take advantage of their inquiry privileges with analysts and actively work this activity into their interactions plan.  In last Saturday’s post (click here) we encouraged startups to use inquiry and suggested some techniques that are valid for all vendors.

Inquiries are a great way to stay “top of mind” with your key analysts between major events or announcements.  In addition, you can use inquiry to enhance the analyst relationship as long as you avoid idle chit-chat and ask questions of substance. 

Some potential topics that might be appropriate for a vendor inquiry with an analyst might include 

Research consumers need account maintenance, part two

Last week (see Part One) we spoke of how getting the maximum value from an automobile required a certain amount of ongoing maintenance and how analyst firm contracts were no different.  We suggested that research consumers create a multi-point checkup and review status with the firm’s Account Executive (AE) on a regular basis.  Each client should have a specific checklist that matches their goals and objectives, but there are some common themes that apply to any purchaser of analyst research.

Some checklist items

First you should consider housekeeping items that pertain to the everyday working of the contract. Are there problems with

Research Consumers need account maintenance, part one

To get the maximum value from an automobile a certain amount of ongoing maintenance is required.  This includes the regular oil change as well as larger items done at specified intervals.  A trip to either the dealer or the quick-lube usually results in a multi-point “safety inspection” to highlight any special concerns. 

Research consumers from IT clients or IT vendors should also consider regular account maintenance and checkups in order to maximize the value of their contract and ensure great service.  Consumers should take control of driving value out of analyst contracts because most analyst firms’ internal processes are not optimized for clients or are simply inefficient.  They don’t generally provide the “safety check” and instituting a review process with your analyst firm Account Executive can serve to monitor the value you receive from the firm’s services.

The Account Executive

The Account Executive (AE) is the key to getting the most out of contracts, because they are the client’s representative within the firm and can best provide access to research and to the analysts. However,

Can the IT industry analysts be objective?

I recently saw this question on Twitter. It was from an AR practitioner, but it also applies to research consumers as well. Several studies* of IT manager clients surfaced that “objectivity” or some variation is an important consideration for buying analyst services. But is this a reasonable expectation for the research consumers? The answer is a qualified “yes” and there are ways for analyst clients to ensure that objectivity is as high as possible.While it is our opinion that analysts do not pull their punches because vendors are clients (see Analyst integrity issues – the urban legend that won’t die), that does not mean that analysts are 100% objective all the time. Every person has life experiences that will permanently or temporarily make them a little less objective.  AR teams may have their doubts about some analysts

Strengths and weaknesses of analyst research delivery types

The communications and IT analyst industry has four basic ways (i.e., written, inquiries, speeches and consulting days) that analysts deliver research and recommendations to their clients. Not all firms use every method listed below and with social media there are new methods being developed that will someday be widely available (e.g., think about a virtual world inquiry where the client’s and analyst’s avatars meet and use a whiteboard).

There is no single method that is perfect for every client and every situation. It is important that the research consumer consider each method and pick the right one for their specific situation

Written Research

• Strength: Available on-line, convenient, most research papers are designed to be quick reads

• Weakness: Represents less than 10% of what the analyst knows, publishing agenda is not always systematically

Do’s about using analyst research

Last week we posted some “dont’s” about using analyst written research, so it seems appropriate to follow up with some positive actions for how to use the research and recommendations from the industry analysts.

Contrary to popular belief, IT market researchers and advisory analysts do not do either lab-based product evaluations or take an academic ivory tower approach and think great thoughts in isolation. Rather, the primary research tool is talking: talking to clients, vendors, investors, and the press – the people on the front lines of creating and using technology. Doing client inquiries is not only a way to deliver client service, but also one of the best research sources that analysts have available. Every inquiry provides an analyst the opportunity to find out why a client has some vendors on or off the evaluation list, how the product they installed earlier is working out, how good the vendor’s service has been, and so on. By gathering hundreds of data points from a number of sources, analysts can quickly use pattern analysis to determine what is happening in a market or with a vendor. Knowing how this research methodology works gives research clients insights into how they can better use analyst research, either written or spoken.

For consumers of analyst research an important question to ask analysts break during an inquiry is “What are the sources of information and number of

Forrester and Gartner Q4 and full year earnings — Higher prices and emphasis on role-based services

The two analyst firms that are publicly held conducted earnings calls last week, Forrester (February 5) and Gartner (February 6). This analysis does not look at areas of interest to investors, but seeks to pull out insights that are relevant to clients and prospects as well as CIT vendor analyst relations (AR) teams.

For clients of both firms, one important fact jumps out of the earnings calls – price increases will be

Know your analyst – Novice, Luminary or Sage

For IT vendor analyst relations (AR) teams, a critical success factor is treating each IT industry analyst as an individual, not some faceless member of a crowd. For example, knowing that an analyst loathes PowerPoint presentations can be an important “ah ha!” to improving a briefing by eliminating an irritation. Similar “ah ha!”s can be gleamed by knowing where an analyst is in his or her career. There are three major stages in an analyst’s growth cycle which will impact how you deal with them: Novice, Luminary and Sage. Each stage has specific motivators and the analyst comes into discussions with vendors with specific ideas, techniques, and needs.

While critical for AR teams, it is also important for research consumers – end user or vendor – to understand if the analysts they are reading or doing inquiries with are Novices, Luminaries or Sages. Each growth stage can provide different types of insights and advice.

The Novice Analyst – Motivated by knowing what their clients don’t know

Being a Novice analyst should not be considered a negative by any means. Novice analysts generally have strong industry experience – usually focused in one segment; have a sharp intellect; can be very

“Dont’s” about using analyst written research

The IT industry analysts do a good job of researching and analyzing the IT industry. Where they often do not do a good job lies in educating their own clients on how to use the research and recommendations. This is critical because analyst clients could end up making wrong decisions about technology and services, putting their companies – and their jobs – at risk. Don’t take written research at face value or view only

Analysts don’t know? Ask them to ask around. [Inquiry]

Despite Myth #1 (The analysts know everything), there are times when clients, end users or vendors, can stump the analysts with a question. While some analysts will use a great question as a trigger to do research and come up with an answer, others distracted by deadlines or travel won’t think to pursue your issue. Obviously if the question is very company specific you might need to commission special research.  However, if the issue is of general enough concern to multiple vendors, other clients, or the market in general it is up to you to make sure