March 18, 2024

Should we stop marketing to the CIO?

Technology marketers have spent the last 25 years trying to get and keep the attention of the people with their hands on the technology tiller inside multi-billion dollar organizations, CIOs.

And for nearly that long, pundits have been predicting that the CIO role would become extinct, and that the strategic decisions about technology would be subsumed into the business.

Those pundits have always been wrong. But this time, they may finally be right—at least about certain types of CIOs. For marketers, this diminished relevance of certain CIOs means two things, I think. First, that they must know more about their CIO audiences than ever, and second, they must rethink how they market to target companies.

Cloud creates a new buying decision pattern
In our ITSMA Webinar How Cloud Computing Will Change Marketing last week, one of our guests made a bold prediction: Major IT services deals will, in the future, bypass IT.

Now, you may say that few big IT services deals ever went through IT. They are too important not to be made by the business. Perhaps, but in most cases, CIOs were crucial to making sure that the deals didn’t completely fall apart. Business people heard grand promises of business efficiency, cost savings, and competitive differentiation, while CIOs provided crucial translation that weighed those promises against the reality of 30-year-old legacy systems, dispersed business units and geographies, business process vagaries, tangled infrastructure—basically, the IT hairball that threatens to choke any deal after it is signed.

CIOs’ power is rooted in complexity
For marketers, having good relationships with CIOs was like knowing the bouncer behind the velvet rope. It got you in the door and created a crucial ally for making deals that everyone could live with.

But while CIOs may have been crucial to the deals, there was always a problem. CIOs’ power has, to a certain extent, always been rooted in something that business people hate: complexity. CIOs were the only ones who had any insight into how the individual hairs of the IT hairball were knotted together.

Trying and failing to dislodge the IT hairball
For the last ten years, providers have been trying to dislodge the hairball. It began with Application Service Providers (ASPs) that promised to surgically remove the hairball from the throat of the business. But these outfits could never remove the lump entirely and failed to run things any more efficiently than internal IT departments could.

Then came the Software as a Service (SaaS) providers, who offered certain applications and business processes through their own servers. But most of these applications were peripheral and could only shave little slices off of the hairball.

Cloud moves IT outside the company
And now comes cloud, which is basically ASP with a lot more technology power and sophistication and without the reptilian brand associations. Providers now say that through some combination of cloud technologies, they can blast the hairball to dust and let companies create services that are not hampered by underlying technology complexity. A report from the Corporate Executive Board entitled The Future of Corporate IT predicts that up to 80% of application spending will move outside the company.

What will happen to CIOs
Let’s assume they are right. It seems like a good bet—Moore’s Law doesn’t show any sign of slowing down yet. Here’s what will happen to CIOs if the cloud prognostications come true:

  • The traditional technology-focused CIO will become irrelevant. There will be an entire category of CIOs that marketers should no longer waste time and resources on: Operational CIOs. These are the CIOs who keep the lights on in the IT infrastructure. They buy the hardware and services for the data centers. These CIOs will be written out of the equation when the infrastructure moves into the cloud.
  • Internal IT projects will become external services deals. Another CIO archetype, the Transformational Leader CIOs that have been focused on using IT to improve business processes, may disappear as distinct IT leaders. Those projects will happen outside the company, in the cloud. These CIOs could move to become heads of the specific business services that run in the cloud and manage the relationships with providers, predicts the Corporate Executive Board.
  • IT departments will shrink dramatically. The Corporate Executive Board predicts that 75% of in-house IT positions will disappear in the next five years. What few positions remain will be dedicated to supporting specific business services.

What will happen to marketers
Okay, so what does all this mean for marketers? I see four key shifts:

  • The technology sale will become the business service sale. All of this could spell the end of what we have traditionally called the technology buyer. The sale will have to be made on higher level technology-based business services. Marketers will need to stop focusing on technology-based pitches.
  • The importance of audience segmentation in B2B will increase. More than ever, marketers will need to know which CIO archetype they are talking to and make sure they are not wasting time on those who can’t impact the business service sale.
  • Idea marketing will become more important. With speeds and feeds no longer relevant, marketers must get the attention of customers through ideas about how to improve business services rather than technology comparisons.
  • Relationships will matter more after the sale. The cloud means that everything becomes a service. Without the IT hairball to lock providers and customers together in a death embrace, the barriers to switching providers will come down. That means that marketers will need to devote more attention and dollars to the loyalty stage of the buying process.

What do you think? How will cloud change the CIO and marketing to the CIO?

Enhanced by Zemanta

Post to Twitter

Why your marketing to CIOs may be irrelevant—and what to do about it

When I covered CIOs for 13 years at CIO Magazine, I found that it was very difficult to generalize about the profession, beyond a handful of universal problems such as alignment with the business and the complexities and the voracious needs of the IT infrastructure.

If I learned anything in those years, it was that CIOs really are a diverse lot. And that has big implications for marketers.

To market to these people effectively, you’re going to have to get to know them as being part of multiple, unique segments. That means understanding not just the top 10 IT drivers for 2009 as predicted by Gartner or Forrester. It means understanding different CIO roles, skills, aspirations, and business contexts.

CIOs are in fact so different that marketing to them all with the same message means that you’ll be irrelevant at best, and offensive at worst to most of the people you’re trying to reach.

CIOs are not all the same
When I was at CIO, I was very frustrated with the findings from our State of the CIO survey because they were relentlessly identical from year to year. But I know that in speaking to hundreds of CIOs, very few fit into the exact same mold. I found that every CIO I spoke to had at least a few unique issues—whether it is unique industry requirements, organizational complexities, or other things that they were grappling with that I hadn’t heard from anyone else.

So one year when I ran the State of the CIO survey we decided to take a deeper look at this data. We came up with some interesting insights.

For example, we’ve long thought that CIOs in smaller organizations are hamstrung by a lack of discretionary budget to work with, small staffs, and a lack of access to the CEO in the business.

So we started pulling factors like these together, and sure enough, new insights began to emerge. We began to see the CIO in more segmented way, with different drivers and motivations.

This led to what we started calling the “CIO archetypes.” Since I did the original archetypes work at CIO, they’ve morphed a little bit. We originally had four, but today they’ve been reduced to three, and the names have changed:

Function Head. These CIOs focus on keeping the lights on, on the IT utility, and are usually at smaller organizations or divisions within larger organizations.

Transformational Leader. These CIOs tend to be in larger companies and generally serve multiple business entities. Because they have this cross-business visibility, they have the opportunity to become business process experts and use IT to make those processes more efficient and effective. Following through on those process opportunities requires more than programming and project management skills, however. They focus on processes and standards, different organizations, and they do a lot of work on governance; especially concerning what elements of IT are shared and what are local.

Business Strategist. These lucky devils have access to the business and are involved in strategic planning. The best have built up their business skills through direct experience. Others are successful CIOs who take on complementary business roles in addition to IT such as supply chain, for example.

Though CIO no longer tracks a fourth category, I think it’s important to mention:

Turnaround Artist. These are a small, powerful minority of CIOs who defy categorization. You can find the Turnaround Artists in any of the archetypes, but they have one important issue that marketers need to be aware of: they’ve been brought into fix what the business thinks is a broken IT department.

Can you see how these different archetypes have different needs and interests? Have you tried to segment your CIO audience?

Post to Twitter

Get Adobe Flash player