Web 2.0 makes industry analysts irrelevant!

Okay that might be a little too bold of a statement. However the impact of Web 2.0 and Social Media has definitely shaken up the status quo when it comes to analysts and influencers. Why shouldn’t it? Look what it has done to traditional press. So an industry that was built on the model of have a few select members have access to the vast number of technology vendors, with the goal in mind of leveraging this relationship and synthesizing what was learned and educating the masses of users that wouldn’t know a desktop from a server, has now come under siege as much of this information is available….for free….on the web.

Just go to Google or Bing and do a search around Gartner or Forrester with .ppt and you will find some of the power-point decks from these firms that contain a wealth of data which in the past you would have to pay $20k + a year to get access to these figures. Couple this with more analysts publishing blogs that are open to all to read, such as an Interactive Marketing blog from Forrester or the Logistics Blog from ARC Advisory. Suddenly the content and access to the analysts seems to be more open to the general public – anyone with a browser can reach out to the likes of Gartner et. al. and engage via social media channels. Add to this the phenomena of analysts throwing up their own shingle in cyberspace and now you have even more channels of information that are just one click away – such as supply chain matters or spend matters.

So as a vendor or user, should you spend $20k, $50k, $250k or more to engage with the likes of Forrester, Gartner, Yankee Group, IDC and the others?  I will say absolutely. However the way you negotiate and structure your contracts will be much different that it would have been 5 or 10 years ago.

First, do not feel trapped into having acquire a number of access seats to the content. As we have seen, the barrier to the access to the content has become lower and lower. To have to pay large sums of money to allow the sales director from your Sioux City branch office to access the research is not worth it.

Second, as a marketing organization push for as much face to face/interactive time possible to be included in the contact. End of the day the amount of money you are paying in the contract is to allow yourself the opportunity to speak directly with analysts. The value of engaging with analyst firms is to be able to be first in the queue when you have a question, concern or need some strategic insight from the firm.  To be able to speak with an analyst for competitive intelligence or insight on a prospect remains highly valuable and only consistently available via a traditional contract.

Finally,  as a vendor the relationship with these analyst firms remains a strategic one – to gain intelligence and insight as well as a tactical one – tell users why your product is worthy of being short listed. As a user these firms are helpful with regards to grasping the technology curve and getting the true inside scoop of what goes on behind the scenes at vendors.

Web 2.0 has lowered the barrier to gaining insight into content and data. It has also allowed for easier access to the thought leaders of the industry. However without a traditional contract with these firms, clients remain limited in regards to how much they can take advantage of all the resources that are available.

What is Analyst Relations and is it relevant anymore?

During my life I have worked at a Forrester Research as well as in the hi tech marketing world where I leveraged and managed services from similar market research companies.  Anyone who has worked in the technology space – either buying or selling the technology – is very familiar with the companies: Gartner, Forrester, AMR Research, ARC advisory, Aberdeen Group, Ventana Research, IDC, Jupiter Group, Meta, Giga, or Yankee Group  just to name a few. All these firms really emerged from the industry that Gartner and Yankee started back in the 1980s, the former looking at IT issues riding the wave of Digital Equipment, IBM and Wang while the former tackled the telecom space. Many of the other firms were founded by former Gartner or Yankee employees, the market research world is very incestuous!

Of course technology vendors are very familiar with the game we all play with these firms. We want to ensure they say good things about us so that when Proctor&Gamble or Toyota or Dow Chemical calls they will ensure we get short listed and better yet touted as the best solution and only option on the market! As vendors caught on to this game they realized they needed to tackle this with a dedicated resource or team of Analyst Relations professionals (something vendors with online communities need to replicate see my post from June 14 ) AR professionals were tasked with engaging with specific firms and analysts to ensure proper aka favorable, coverage. Many times the amount of money spent with firms was thought to have a direct correlation with level of coverage. Sometimes it did sometimes it did not. As time and the market has evolved and become more savvy, this pay for play model fizzled out.

What became more important was the ability of the AR community to build a true relationship with the relevant analysts. Analysts appreciated AR professionals that would share the inside scoop or gave them and advanced overview of a big announcement. Now, sometime companies would regret this sharing when the comments and insight ended up in a report. However good AR professionals took the time to learn the analyst community, who they could share sensitive information with and which analysts were just megaphones waiting for any “juicy” piece of inside information. A well developed relationship would start working both ways, with analysts being more open with that company, freer with some information shared and overall more of a strategic partner. So what does this mean in a world where market research firms have dwindled? Forrester went out and acquired Jupiter and Giga, Gartner has gobbled up AMR Research and Meta Group finally Aberdeen was acquired by Harte Hankes. Meanwhile the independents have only continued to spring up – that being analysts putting out their own shingle. With the explosion of Web 2.0 tools this has never been simpler. Look at what some former Forrester analysts have down with Altimeter Group…

Are AR teams still important? Can they play a role in a world that seems to be consolidating? I will say a resounding yes. I think having a solid AR team has never been more crucial. Why? With free blogging tools and Twitter more independents and more individuals will be sharing their experience and thoughts about technology and vendors! Hey look at this blog! So technology vendors must have an even keener eye monitoring and developing relationships with those in traditional market research firms but also with the blogosphere. In addition, one must keep good relationships with analysts at established firms because there is not much between them and becoming an independent still sharing their thoughts via blogs and twitter…

A good AR team will allow vendors to maintain positive relationships and open lines of communications. The trick is, once an analyst becomes independent they are not under a corporate umbrella that still has certain rules. Nor a corporate umbrella that a vendor can threaten to “pull the plug” on a contract if analysts are not checked. Now granted, some independents might rely even more on vendor revenue, but they tend not to be publicly traded firms – like a Forrester or Gartner – that needs to answer to Wall Street every 3 months!

So if you are thinking you no longer need AR, think again. Instead give your AR team greater responsibility to managing relationships in the blogosphere, while they will always need to manage and negotiate the contracts with traditional firms, they will need to pay greater attention to what is being said by single voices in cyberspace that can be easily found via Google, Bing or Technorati…