Targeting SMBs
The zombie horse takes another beating over at Ed's -- where a bunch of people joining in again to complain about IBM's marketing to the SMB sector. I have mixed feelings about how IBM handles their marketing in this regard, but I think it's much more important to think about how IBM handles their product strategy.
I've been pretty vocal before about how disappointed I am in IBM's new tendency to put relatively simple products on these uber-platforms, where the technical experise required to deploy jumps by an order of magnitude. It's a personal pet-peeve because I've been so passionate about usuability lately. But I've also come to believe that this is an important part of marketing to SMBs, where the single most important marketing tool available is AUDITIONING. Every business manager that I've ever known in organizations of < 1000 people has the same question about every new piece of technology: When can I try it out?
Here's the simple question to ask yourself: what does the CEO of a 200 person company have to do to try out, say, blogging? He can start something at Typepad or Blogger or MSN in 10 minutes, right? What if he wants to host it inside his own domain? What does he have to do to try it out on Wordpress? On Sharepoint? On Domino?
What about trying out email? With gmail, all you need is a credit card and 15 minutes to fill out a web page. Don't like the risks involved with that approach? What does it take to get an Exchange server up and running? What about a Domino server? What can you get results on sooner?
So what if he wants to try out instant messaging? What does it take to get the different options running? AIM vs. Trillian vs. MSN Messenger vs. Sametime? If even EVALUATING competing choices requires 100 times the effort on one versus the other, do you think that's going to be a decision criteria? It certainly is for me. And that's why I get bent out of shape when I see what the setup requirements are for IBM's new Sametime Gateway, or Activities server, or, I fear, Lotus Connections.
One of the saving graces of the Domino platform is that, although it can be somewhat intimidating to actually buy it, it's at least fairly easy to try it. It requires some determination, but you can figure out where to download it for free, and you can run the install on just about any box in your environment. And you can get visible results inside of an hour. That has allowed it to be an exploratory technology. It doesn't require heavy commitment.
And while I appreciate the engineering brilliance of something like the Activities server, the truth is that in an organization of < 1000 users, no one really needs the scaling capacity of a DB2 backend, do they? So when a product gets brought to market that requires a terabyte RDBMS behind it, then it's automatically off the radar screen in smaller organizations.
The transaction cost of working with IBM software is simply too high.
I want to say that again, really loudly: THE TRANSACTION COST OF WORKING WITH IBM SOFTWARE IS TOO HIGH.
And this is what I think a lot of people secretly mean when they complain about IBM's marketing to SMBs. There's awareness -- nobody in business doesn't know who IBM is, or fails to realize they offer an incredibly wide array of software to businesses of all types. But turning to Microsoft or Google frequently happens because it's just so easy to do. Even if there isn't already a relationship, it's going to be very easy to figure out how to get one. There is very little learning curve involved in setting up a gmail account or installing the latest version of Exchange.
That's one of the reasons the business segments of those companies profit from their consumer ventures -- the consumer relationships reduce the transaction costs of working with them on a business level. No, it's not the ONLY reason. Yes, there's a lot of emotion involved. Yes,there's some technology involved. But don't underestimate the importance of these transactions costs. When a company has to make an investment in IBM simply in order to find out what's in their product catalog, that's a big barrier. It's like driving 300 miles to shop for a car -- you'll do it if you need a fleet of 10. You aren't going to swing by there to take a test drive.
How can this get fixed? A big part of it is product strategy. IBM should decide that it hasn't delivered a solution to the SMB market until the solution is auditionable. And that means it has to be easy to find and easy to try. Imagine this: what if you took all the people that write install and setup routines and made them report to SMB marketing instead of product dev? How would that change priorities? How much more trial would your best products get?
Don't hold back good reader -- click on that "comments" link.
Comments
I should be able to remote into a session and try out the different products. I'm not talking about just a web-based only experience but a rich-client one as well.
Partners could add in their solutions. So in the example of Notes, it could even be an outline in a db that allows me to launch various 3rd party products inside of Notes. Notes is obviously ideal for that kind of scenario.
In about 5 minutes you could show CRM solution from company A vs company B and how they integrate with a secure mail system.
Which one do you prefer? Sold. Thank you very much. And btw now that you have decided on CRM how about product xxx to compliment it..
And also btw
1. Do you want a hosted version from one one our partners (or IBM - get in the hosting game please).
2. To schedule an on-site install with help from our partners
3. Or you just want the disks/download site and you will do it yourself.
In fact Sametime could be available to make an immediate connection to partners etc for scheduling purposes, rates etc
or
if I'm demoing an application and have a blackberry I can send myself stuff to show client how easy it is etc..
Any which way. Sold.
Posted by Stephen Hood At 05:12:40 PM On 02/05/2007 | - Website - |
I will start.
You are right the transaction cost is too high. But even for Domino it is too high. Three examples, there is no demo site for a potential customer to download a preconfigured Notes client to try out Notes from one of the IBM site. As a result, you have to get a partner to install one for you.
Second, if you would like to run a flash demo, you have to a log in to IBM to register first. Huh?
Third, Domino is trivial to install and configure if you are coming from the IBM Lotus Notes and Domino world. If you have never been in the Domino world the approach is totally different and confusing.
Results, lost deal. Real story.
To response to IBM marketing issue, I understand IBM is focused on branding and not on a particular product. However, for the SMB market, IBM or the partners needs to deliver a more focused approach in order to compete.
Posted by Richard Moy At 05:25:54 PM On 02/05/2007 | - Website - |
@2 - Actually, I'll one-up you about that Flash demo stuff. Forget having to register. Just try so much as FINDING one.
But I don't think it's that hard to install a Domino server, even if you never have. That process is pretty straight forward, even at a consumer level. For instance, my mother has done it.
But I won't argue that even Domino itself has high transaction costs. Certainly they're through the roof when compared to, say, salesforce.com.
Posted by Nathan T. Freeman At 05:46:33 PM On 02/05/2007 | - Website - |
The Auditioning capability (or "Demonstrability") has always been a real strong point of Domino (though as you say, perhaps not up with the latest Web2.0 type apps) - every Thinkpad I've had since 1995 has had the resources to be able to run a full install of the Domino server for basic demo purposes. 20 minutes after the download finishes, you can have a demo organisation installed and accessible, available skills withstanding.
The issue is that the whole Lotus proposition for 2007 and beyond (which I wholeheartedly support from a Sales/Marketing perspective) relies on multiple interlocking and integrated application servers/services. Now for demo purposes we're gonna need Domino, Sametime, Quickr, Connections (and we still don't fully know what servers are needed for this) and possibly Portal.
Now my 2005-vintage Thinkpad won't run Portal on its own, let along with some combination of other Domino-related services. This will make it difficult for us BPs to demo, and for Notes "evangelists" within organisations to setup and play with.
This isn't an attempt to criticise IBM for this state of affairs, just that we need to be aware of where we are and to be very creative in solving the issues...
Stuart
Posted by Stuart McIntyre At 05:57:28 PM On 02/05/2007 | - Website - |
Wait, IBM doesn't have a site to play with? That is wrong too, Sametime, Doc, Domino, Quickplace have all had "free and open" 30 day trial login functions at the Lotus/IBM website in the past.
The problem, is not many of those survive past the marketing teams budget.
Kind of like stocking shelves at Walmart, you pay for placement.
Now could IBM keep those hosted forever, sure, why don't they, probably because the numbers using it didn't equate to the effort.
Sadly they may be right if that was the case, but really I think sometimes the issue is "Lotus 1-2-3" for some of the market and "NOtes is dead" to the rest, at least in a SMB level, which is who I talk to often enough.
Posted by Keith Brooks At 08:04:18 PM On 02/05/2007 | - Website - |
I do have to take issue with your like "Forget having to register. Just try so much as FINDING one."
Type in www.lotus.com. At the very top of the main (middle) section of the page you should see "Trials and Demos". If you want just the flash demos, change the "limit to" pull down to "demos" and click go. I see 30 results.
Don't like that approach, click on one of the main categories of the home page under "What we offer". I'll try email since this is mainly a Notes crowd. Right hand side of the screen... "Demos".
Don't like the Lotus web site, fine try Google. Enter "lotus flash demo", first hit, the Hannover demo. Try "lotus software demos", even better, it returns the main demo page for all Lotus products. { Link } How about just "lotus demos", that returns the developerWorks Live Showcases, where you can try out hosted versions of DWA, QuickPlace, Sametime, etc.
Not perfect that all the searches don't point to the exact same place, but still, in 30 seconds I was able to easily find the Lotus Flash Demo home, as well as the developerWorks Hosted Trial site. Do I win a prize?
Still, to prove I have not totally drank the koolaid, I completely disagree with IBM's policy on requiring registration. I find it pointless and annoying, but I've lost that battle every time I've tried, and the folks that track the registrations swear by their value, so I'll give in.
Posted by Alan Lepofsky At 09:05:07 PM On 02/05/2007 | - Website - |
I am very familiar with the trial and demo site that you are referring to. And yes the trials and demos are there. Here is my issue in which I maybe wrong and if so please correct me. The trial and demo site has lots of demos and trials. However, a great number of them a small business will never use. It should not be a long list of products. Second, there should be a trial in which the potential customer can simplicity download the client, install and run from a predefined set in which they can try the Notes client that is hosted by IBM with scenarios already created. I have had to do this myself for our business for our marketing instead.
Third, which I have brought up at Lotusphere again with the IBM SMB group that the SMB site needs to be more focused. The new site is a little better but where is Lotus Notes the best SMB product that IBM has. If you go to the Small Business Resource Center from the main page, after a few clicks to the software offering, there is Trivoli but where is Lotus Notes? Instead you have Lotus 123 and organizer. I must assume that they sell better than Notes.
If it is the Small Business Resource Center why are you talking about medium business offerings on that part of the site? You can't even get to the trials and demos easy unless you are familiar with the site. If IBM is selling the brand, the access to the Small Business Resource Center should be the portal to all small business offerings and solutions a small business needs. Another thing that confuses me, when it comes to offering partner solutions that suppose to address the needs of a small business why are most of solutions not using IBM technology?
Sorry, if I am tearing into this but I have had this conversation over and over again with IBM.
When you go to the Small Business Center is should be totally focused on the needs of the small business. Also there doesn't seem to be anyone who has ownership of the small business market that coordinates everything.
Alan, let me know if I am wrong.
Posted by Richard Moy At 09:54:21 PM On 02/05/2007 | - Website - |
@6 - Alan, you know I like to stir the pot.
Try any of those google searches without the word "Lotus" in them. Try them with and without "IBM." After all, if I'm looking for an IM solution, I'm not going to put a particular vendor in my search criteria, am I? (Mind you, Sametime is in the top 10 on "instant messaging demo" so credit to ya on that one.)
Yes, online demos for some of this are good. I've heard a bit about the Greenhouse stuff. (We got invited to play as part of the Notes 8 DP program.) As someone once said to me about a synthesizer I was playing with "Ah... the limitations are endless."
Seriously, I think there's a great set of possibilities there and I'm delighted to hear that you guys are already looking. It's a big step. And maybe it's enough. If it is, I'll shut the hell up. I gotta see it first though.
But what I'm trying to get at here is that IBM is in the habit of TELLING. You need to get in the habit of SHOWING. That's what the competition does, and it's pushing them out ahead of you, particularly in markets that can't afford to make an investment in search & education costs. It's not enough to describe a set of features and cost-benefits.
And I really believe that, without realizing it, that's what people mean when they complain about IBM's SMB targeting. It's not advertising. It's not pricing. It IS a failure to understand the needs of small business.
Oh, you understand the ultimate deliverable well-enough -- simply not THE PROCESS to get to it. And it's where the competition is eating your lunch.
But IBM's anticipated me before (Quickr, anyone?) so feel free to solve announce a solution in the next 10 days or something.
Posted by Nathan T. Freeman At 10:20:54 PM On 02/05/2007 | - Website - |
But Richard, you need to get over this "IBM doesn't know how to work with SMB customers" stuff. Maybe you need to change your approach. We have been very successful with SMB customers (and with SMB I mean 1 to 300 employees) with IBM technology. And not just Notes/Domino ... I have a customer with 15 users who uses Portal and they get it.
IBM is never going to compete with Microsoft in the marketing arena .. they market to different groups. IBM is IBM .. big blue ... as a man far smarter than me said "Get on the Bus or Get Off"
Moral of the story .. just because you do not get everything you need from IBM doesn't mean it's IBM's fault. Sometimes you need to change your approach on how you sell ... stop selling software and selling solutions. It works. IBM has case studies to prove it (and just to be fair, yes, a couple of those are PSC customers).
Posted by John Head At 10:38:23 PM On 02/05/2007 | - Website - |
We only sell solutions to our customers. My discussion is not about our company. It is more of a general discussion. If other Business Partners don't want to focus in this area the more the better for us.
Can you explain to me how Microsoft is marketing to a different group? When your customer ask you about what is the foundation for your solutions and you mention Lotus and they think of Lotus 123 and when they go to the IBM web site for small business and there is only Lotus 123.
Posted by Richard Moy At 10:57:15 PM On 02/05/2007 | - Website - |
Forgot to mention. I agree there is not an easy solution for hosting trials that would not affect the hosting partners if it was done as a trial with live data.
Posted by Richard Moy At 11:02:54 PM On 02/05/2007 | - Website - |
I don't know what website you are looking at.
I just typed "{ Link } and got a page that is all about collaboration, features the new Portal Express announcement, and highlights a case study from a 50 employee company.
I then clicked on "products". The first one is Notes and Domino Express. Sametime is next. I certainly see no mention of Organizer or 1-2-3.
Then I clicked on "demos". Four demos available, just another click away.
All told, it seems like this section of the website delivers 100% of what you are looking for. It was announced at Lotusphere, and featured on the CDs that were distributed on BD Day.
There are hundreds if not thousands of Notes customers who fit the definition of SMB that you'd prefer. There are whole departments at IBM focused on selling to them. Someone somewhere is getting the support they need from IBM to sell into this market. I always acknowledge that there is more that could be done, but perhaps you need to see how to best partner with IBM to move forward?
Posted by Ed Brill At 11:45:16 PM On 02/05/2007 | - Website - |
As for "You need to get in the habit of SHOWING.", I totally agree. I think we've made big strides. Better web site design, better advertising, and better products. We're on the right path, Lotusphere 2007 was a great example. Of course, there is a still that could be (and hopefully will be) done.
Richard, that SMB page is horrible, I agree. I've sent a note to see what we can do to get it updated. Thankfully Domino Express is listed here: { Link }
Posted by Alan Lepofsky At 11:57:28 PM On 02/05/2007 | - Website - |
All they are interested in are the applications ! (CRMs,Libraries,Timesheet apps ...)
This is where the real "value" is for THEM and this is also the reason why they decide to get this product.
Lotus Notes should provide a bunch of example/trial applications. Moreover it should have a catalog of all existing (and checked by IBM to meet some quality requirements) applications. If possible this should be as easily integrated as the "Extensions" in firefox. One click and you download a trial which gets installed into a "trials"-space and you are ready to go.
Any manager would "jump of joy" if he could test several CRMs in only a few minutes. And SMBs especially, as they don't have the time to make lenghty comparisons between all available solutions out there.
Posted by Hynek Kobelka At 04:34:21 AM On 02/06/2007 | - Website - |
Then try searching for "IBM small business server" and you get a link to IBM website selling system X and MS Small Business Server pre loaded. There is no mention to a alternative IBM offering of Hardware + Domino bundled together.
If I was a small business looking to buy a server for email/apps, I wouldn't be game to go with Linux and IBM doesn't 'appear' to have any other 'solutions' for me! Also consider that most SMB outsource thier small IT function.
A friend ran a small business and for an office of 12 the outsourcer charged 1000 AUD/month to come in and setup email/backups etc. Are these type of companies going to choose domino on linux?
Surely its not that hard to do a solution for a neat software/hardware bundle when you own both!
Hang on...thats a great idea, add in 'the nifty fifty' and there something 'small businesses' would be interested in - maybe I should just do it myself!
Nathan - great post
Posted by Tony Palmer At 05:15:10 AM On 02/06/2007 | - Website - |
{ Link } Look for the words "Small Business." Ah! There's a link on the right.
Small business resource center. There's "Products" "Solutions" "Services" "Resources"
But none of these seem to take you to the stuff you're talking about. (Maybe I should just post a Camtasia video of the process?)
And hey -- let's not let this get diverted into a conversation about the ibm.com site. Discovery costs for PRODUCT NAMES is one thing. But even once I find out that your IM solution is "Sametime" the question is: how can I play with it? Because playing with AIM or MSN or GoogleTalk is pretty easy, right? A flash demo is not enough. That's like selling me a car by offering me a DVD of someone driving the car around. I'm pretty sure I'm going to want to take a test drive.
And once again, I'm not saying there's NO way to work this stuff out. Just that the comparisons make IBM a mystery. Check out how many "Download" and "Trial" links there are on Microsoft.com's home page, if you select their "Business" option. I can't find "Trial" on the ibm.com homepage. (There's downloads -- but they're all support-related.)
How about www.google.com? Click "Business Solutions" Scan the page for "Email." Wow. 10 seconds, and I'm looking at signup and pricing information for Google Apps.
THAT is frictionless.
Posted by Nathan T. Freeman At 07:52:03 AM On 02/06/2007 | - Website - |
I am referring to the small business resource center link on the www.ibm.com home page.
Posted by Richard Moy At 09:12:08 AM On 02/06/2007 | - Website - |
Greenhouse dumped me into "Many Eyes" on developerworks. Maybe not ready for prime time.
Flash demo? Who cares about a flash demo? Real life is what people want and need to validate a program does what is required. Quickplace should be easy, like Groove was, I needed a quickplace and the easiest way was to use an online version of the program for however long the host would let me, but there was no Quickplace in sight at the time, so Groove was it.
Hosted Document Manager would go far as well if for no other reason than to show how difficult it is for normal people to understand how to use it. Simple it is not, when it very well should be.
Posted by Keith Brooks At 09:29:52 AM On 02/06/2007 | - Website - |
{ Link }
then I think they can handle a live trial site as I suggested. I think it's about getting the ducks lined up rather than capabilities.
As far as full-time hosting, IBM should certainly be in that game for SMB's IMO. There are many ways to position it so that it actually *benefits* current hosting partners.
There are numerous companies that would just feel more comfortable going with IBM and it has nothing to do with the quality of the hosting partners. As I said there is also room for big wins for those hosting partners as well..just have to think creatively..
To me it's even more interesting with the Lotus Document editors coming into the picture as the hook.
Given the modularity of the Eclipse plug-in model it would be much easier for hosting partners to differentiate their offerings by putting together solutions/combinations IBM can't possibly go after etc..just one example.
Posted by Stephen Hood At 09:46:55 AM On 02/06/2007 | - Website - |
You would still need some decent CPU and memory on servers/desktops at the customer/partner, but it would foreshorten the time to demonstrability significantly.
Given IBMs size and its partnerships with VMWare at various levels in the business, it would be great if they could get over these hurdles. In fact, I remember a version of WSE that was ready built on a Redhat VMWare image that was made available in 2005/6 - if that could be done, then maybe there is hope?
Stuart
Posted by Stuart McIntyre At 10:21:33 AM On 02/06/2007 | - Website - |
Posted by Timothy Briley At 11:07:06 AM On 02/06/2007 | - Website - |
I mean, it's pretty easy to get stuff like "Company Name" and "Your Name" correct.
Posted by Nathan T. Freeman At 11:37:01 AM On 02/06/2007 | - Website - |
Posted by John Head At 12:37:38 PM On 02/06/2007 | - Website - |
Posted by Stuart McIntyre At 02:33:15 PM On 02/06/2007 | - Website - |
Sametime is one, hosted such that you can register and then try it out online. No dollar investment at all by the customer aside from some time.
We did the same thing for a System i customer who runs Domino but needed a good team space environment. We led them to the trial site for QuickPlace. They tried it and bought it.
The resources are indeed out there. However, I entirely agree that for most of the "real" SMB space you have to audition the solution before they bite.
K.
Posted by Kevin Mort At 11:00:43 AM On 02/07/2007 | - Website - |
I honestly don't see why anyone would complain about IBM hosting demos for potential customers. It's not production so there is no competition with any partner. Hosted demos would help, but are only part of the answer. I still need to try it in my environment before I commit to buying. And the flash demos are useless even for the CxO types. The first thing I always get asked is "now how can I get my hands on it".
The primary reason I say that IBM doesn't understand SMB's is the moving parts issue. Domino has always been a one stop shop: mail (including SMTP, POP3 and IMAP), calendaring, scheduling and HTTP all rolled into one. The new things being released, such as Dogear, Activities and Sametime RTC, are requiring Websphere Portal and DB2. The installation is fragmented, so even if I want to just try it out I have to invest a significant amount of time in learning the infrastructure components, then installing and configuring them, and then finally working with the part that layers on top of it. It has to be more transparent to get traction in SMB's.
I spoke with some Lotus and IBM product managers at Lotusphere about this problem and while they smiled and nodded, I felt like I was dismissed. One techie type I chatted with over lunch one day said that an organization of my size (200 users) was smaller than the target for most of these products. He had never heard anyone discuss the possibility that organizations under a few thousand users might find them useful, and was surprised I was interested.
To me the heart of the problem is partly corporate culture and partly a lack of direct focus, with just a dash of arrogance.
Posted by Charles Robinson At 02:36:27 PM On 02/12/2007 | - Website - |
That makes sense, since you were exactly the kind of person I was thinking of when I wrote the post. We've had this conversation at your blog as well.
The Greenhouse stuff mentioned should help. If it's a pure public demo site, then it will still be limited by not allowing integration with a company's internal deployment. Then again, that's probably never easy to do.
Posted by Nathan T. Freeman At 03:56:21 PM On 02/12/2007 | - Website - |
Posted by Charles Robinson At 10:36:11 PM On 02/12/2007 | - Website - |