ITSMA Services Marketing Budgets And Benchmarks 2008

Services Marketing Budgets and Benchmarks 2008 Budget Allocations and Trends ABBREVIATED SUMMARY Data from ITSMA Key Metrics Survey May 2008 Julie Schwartz Senior Vice President Thought Leadership and Research ITSMA Abbreviated Summary | B018AS

Introduction In this report, ITSMA shares the results of 46 responses from 44 unique companies that provided data on and insights into:  Services marketing budget size, allocations, and growth rates  Marcom budget allocation  Services revenue and profitability  Services marketing staffing and operations  Solutions marketing  Gross margin trends  Top services marketing initiatives and priorities Note: This abbreviated summary highlights some of the significant findings from ITSMA’s IT Professional Services and Solutions, 2008 Brand Tracking Study. A more in-depth discussion of the study findings can be found in the full report. Abbreviated Summary | B018AS Services Marketing Budgets and Benchmarks © 2008 ITSMA. All Rights Reserved. 2

Marketers are Optimistic Amid a Slowing Economy 2008 Growth Forecasts Are Optimistic Projected Growth in Services Revenue 38 26 21 19 18 18 14 15 11 -2 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 (est.) Source: ITSMA, Budget Allocations and Trends: Key Metrics Survey, 2000, 2001, 2002, 2003, 2004, 2005, 2006, 2007, 2008 Abbreviated Summary | B018AS Services Marketing Budgets and Benchmarks © 2008 ITSMA. All Rights Reserved. 3

Heading into 2008, marketers are predicting both marketing budget and staff increases What changes do you anticipate Stay the same in your services marketing (24%) budget in 2008? Increase (61%) % of Respondents (N=46) Amount of Decrease (15%) increase: 18.9% Amount of decrease: 9.9% (N=28) (N=8) What changes do you anticipate in your services Increase (40%) marketing staff in 2008? Amount of Stay the same (48%) increase: 6.4% % of Respondents (N=25) (N=10) Decrease (12%) Amount of decrease: 1.7% (N=3) Source: ITSMA, Budget Allocations and Trends: Key Metrics Survey, 2008 Abbreviated Summary | B018AS Services Marketing Budgets and Benchmarks © 2008 ITSMA. All Rights Reserved. 4

ITSMA data shows a steady trend toward allocating more marketing budget for programs, rather than personnel What percentage of the services marketing budget was personnel costs (direct employees and benefits) vs. marketing program expenses? Mean % of Services Marketing Budget 49 53 56 57 Nonpersonnel Personnel 51 47 44 43 2005 (N=22) 2006 (N=44) 2007 (N=44) 2008 (N=44) Source: ITSMA, Budget Allocations and Trends: Key Metrics Survey, 2005, 2006, 2007, 2008 Abbreviated Summary | B018AS Services Marketing Budgets and Benchmarks © 2008 ITSMA. All Rights Reserved. 5

There are two drivers reducing marketing personnel expense  Increasing prominence of Indian services providers with lower personnel costs What percentage of the services 51 marketing budget was personnel costs 85 Nonpersonnel (direct employees and benefits) vs. 49 Personnel marketing program expenses? 15 2008 Mean % of Services Marketing NA/EMEA Indian Budget Companies Companies Note: Differences by region are statistically significant. (N=36) (N=8)  Growing penchant for outsourcing marketing In FY2008, do you expect outsourcing of marketing initiatives and programs Stay the Increase to increase, decrease, or stay the same same when compared to FY2007? (51%) (44%) % of Respondents (N=43) Decrease (5%) Source: ITSMA, Budget Allocations and Trends: Key Metrics Survey, 2008 Abbreviated Summary | B018AS Services Marketing Budgets and Benchmarks © 2008 ITSMA. All Rights Reserved. 6

The biggest news this year is that 67% of respondents plan to increase their spending on sales enablement activities What are your spending plans in 2008 for the following budget categories? % of Respondents (N=27) Sales (channel) enablement and support 67 15 19 Strategy and market planning 52 19 30 Offering management 48 4 48 Marcom 48 7 44 Marketing operations 44 11 44 Market intelligence/market research 37 11 52 Business partners/alliances 31 19 50 Customer satisfaction/relationship 26 11 63 management and monitoring Other 11 41 48 Increase Decrease Stay the Same Source: ITSMA, Budget Allocations and Trends: Key Metrics Survey, 2008 Abbreviated Summary | B018AS Services Marketing Budgets and Benchmarks © 2008 ITSMA. All Rights Reserved. 7

The marcom emphasis is on highly targeted campaigns using face-to-face events, digital media, and thought leadership Marcom Budget Allocation FY2008 Mean % (N=21) Other Sponsorships of Sports/Cultural Events  Public/Press/Media/Community Relations  Advertising  Industry Analyst Relations/Events  Thought Leadership Development and Dissemination  Direct Marketing/Database Marketing  Private Events, Seminars, and Conferences  Public Trade Shows  Interactive/Online/Digital Marketing  Collateral (brochures, datasheets, etc.) Source: ITSMA, Budget Allocations and Trends: Key Metrics Survey, 2008 Abbreviated Summary | B018AS Services Marketing Budgets and Benchmarks © 2008 ITSMA. All Rights Reserved. 8

Services marketers are shifting more of the marcom budget online Approximately what percentage of your services marcom budget is online vs. offline? Mean % of Marcom Budget 2007 (N=25) 2008 (N=23) Online Online (29%) (34%) Offline Offline (71%) (66%) Source: ITSMA, Budget Allocations and Trends: Key Metrics Survey, 2007, 2008 Abbreviated Summary | B018AS Services Marketing Budgets and Benchmarks © 2008 ITSMA. All Rights Reserved. 9

Search engine marketing is poised for growth, however, the most effective marketers are also expanding their use of new social media % of Respondents Increasing Investment (N=23) 70%  Search engine marketing/advertising  Extranets or Microsites  Online communities 50-60%  Podcasts  Intranets/internal collaboration  Webinars  Blogs  Email, electronic newsletters  Wikis <=30%  Corporate Website  Virtual worlds (e.g., Second Life, Universe, Forterra, There.com) Source: ITSMA, Budget Allocations and Trends: Key Metrics Survey, 2008 Abbreviated Summary | B018AS Services Marketing Budgets and Benchmarks © 2008 ITSMA. All Rights Reserved. 10

Account-Based Marketing continues to gain momentum Approximately what percentage of your services marketing budget is dedicated to Account-Based Marketing? FY2006 (N=28) FY2007 (N=18) % Spent on % Spent on Account-Based 7.6% 13.7% Account-Based Marketing Marketing FY2008 (est.) (N=19) % To Be Spent on Account-Based 20.1% Marketing Note: Only includes companies that have implemented Account-Based Marketing programs. Source: ITSMA, Budget Allocations and Trends: Key Metrics Survey, 2006, 2007, 2008 Abbreviated Summary | B018AS Services Marketing Budgets and Benchmarks © 2008 ITSMA. All Rights Reserved. 11

Marketing shakes things up Rank 2008 2007 1 1 Differentiating the company or offerings 2 3 Enabling the sales force 3 7 Generating demand 4 8 Improving customer satisfaction and loyalty 5 — Developing thought leadership 6 — Refining value propositions 7 16 Increasing use of digital tools and online marketing channels 8 6 Leveraging Account-Based Marketing 9 9 Developing and launching new offerings 10 10 Increasing focused marketing programs for vertical/industry markets Note: Top priorities that did not make the list in 2008 but were in the Top 10 of 2007 include developing and refining the marketing strategy (#2 in 2007), deepening customer insight (#4), and enhancing the company's reputation (#5). Source: ITSMA, Budget Allocations and Trends: Key Metrics Survey, 2007, 2008 Abbreviated Summary | B018AS Services Marketing Budgets and Benchmarks © 2008 ITSMA. All Rights Reserved. 12

Contact Julie Schwartz Senior Vice President Thought Leadership and Research ITSMA jschwartz@itsma.com +1-781-862-8500, Ext. 112 Abbreviated Summary | B018AS Services Marketing Budgets and Benchmarks © 2008 ITSMA. All Rights Reserved. 13

ITSMA Services Marketing Budgets And Benchmarks 2008

by ITSMA on Nov 19, 2009

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ITSMA Services Marketing Budgets And Benchmarks 2008 — Presentation Transcript