SVPMA March 2014 Monthly event:
“Elevating from Consumer to Mission Critical Value” with Brian Cox, Senior Director of Marketing for Enterprise Solutions, SanDisk
Read more: http://svpma.org/2014/03/march-2014-event-2/
SVPMA: Elevating from Consumer to Mission Critical Value
1. 1
Elevating from Consumer to
Mission Critical Value
Brian Cox
Sr. Director of Marketing, SanDisk Enterprise Storage Solutions
Silicon Valley Product Management Association
2. 2
Forward-Looking Statements
During our meeting today we may make forward-looking statements.
Any statement that refers to expectations, projections or other characterizations of future
events or circumstances is a forward-looking statement, including those relating to market
position, market growth, product sales, industry trends, supply chain, future memory
technology, production capacity, production costs, technology transitions and future products.
This presentation contains information from third parties, which reflect their projections
as of the date of issuance.
Actual results may differ materially from those expressed in these forward-looking statements
due to factors detailed under the caption “Risk Factors” and elsewhere in the documents we
file from time to time with the SEC, including our annual and quarterly reports.
We undertake no obligation to update these forward-looking statements, which speak only as
of the date hereof.
8. 8
Given that SanDisk has a very strong brand in Consumer products,
how can this be extended to Enterprise IT?
A GlobalBrandLeaderin ConsumerFlashStorageSolutions
NPD Estimate, Nov., ‘13. Estimates of the memory card & USB markets from NPD (Nov. ‘13) and GfK Retail and Technology, Sep., ‘13.
All Leading
Smartphone
& Tablet
Manufacturers
use SanDisk
SanDisk
Client SSDs
Used by
All Leading
PC Manufacturers
Retail: The Leading Brand of
Flash in Key Markets
#1 Global Retail
Revenue Share
9. 9
Index of Percent Definitely Would Consider/Definitely Would Buy
94
109
115
130
66
51
156
Comp Set Avg
Western Digital
Toshiba
Seagate
Hitachi
Fusion IO
SanDisk
Index of Percent Definitely Would Consider
Flash/SSD’s and Buying Intentions Quadrant
Comp Set Avg
SanDisk
Fusion IO
Hitachi
SeagateToshiba
Western Digital
0
20
40
60
80
100
120
140
160
180
200
220
240
0 20 40 60 80 100 120 140 160 180 200 220 240
Comp Set Avg. Definitely Would Consider
CompSetAvg.DefinitelyWouldBuy
Tech Buyer Intelligence Reports | Spring 2013, Wave Two
10. 10
Lower prices afford little or no
individual customer nurturing
High prices with extensive
nurturing and long sales cycle
Keys to Success in
Consumer versus Mission Critical
MISSION CRITICAL ENTERPRISECONSUMER
Source: http://svpg.com/moving-from-enterprise-to-consumer/
• Nearly All about the Product (and scale)
• Supported by online marketing
• Must be intuitively easy
• As much about the Sales organization
as the Product
• Supported by Field Engineers
• Product requires training and
integration with existing gear
11. 11
Requires convincing the End User
Requires convincing
multiple stakeholders
Managing the Buyer Personas
MISSION CRITICAL ENTERPRISECONSUMER
http://www.mindtheproduct.com/2013/02/consumer-vs-enterprise-product-management/
• End User driven
• Influenced by advertising and possibly
consumer sites
• Purchasing Department driven, but
influenced by End User stakeholders
• Influenced by Sales Reps, industry
studies and community of experts
13. 13
Enterprise Customer Mix Is Changing!
HDDandSSDTBsShippedbyEnterpriseConsumptionCategories
Source: IDC “New and Growing Channels for Storage
Industry Terabyte Shipments” Mar 2013 - Doc # 239953
14. 14
are the Enterprise SSD Customers?
Enterprise Application Software Vendors: SAP, Oracle, Microsoft, VMware…
Line of Business/Function Owners: Manufacturing, Sales, Finance, HR, etc.
Traditional OEM Server & Storage Array Vendors: IBM, Dell, NetApp, etc.
Growing Web 2.0 & Cloud Computing companies: Google, Yahoo, eBay, etc.
Traditional Enterprise Data Centers: General Motors, Texaco, AAA, IRS, etc.
DirectIndirectInfluence
15. 15
to Reach the Customer: Routes to Market
Building a direct to End Customer relationship is a competitive advantage
• Enables SSD vendor to create and manage perceptions with the End Customer segment
• Customer knowledge, support & trust are a significant barrier to new entrants
• Direct, unfiltered feedback on pain points, growth areas to innovate ahead of OEMs and competition
• Platform to grow business, extend into new market segments
• Risks: This business model has high S&M, so must maintain higher ASP units and profit margins, moderate R&D as % of OpEx
TRADITIONAL ROUTE
EMERGING ROUTE
SSD Vendor OEM End Customer
End CustomerOEMSSD Vendor
INFLUENCE
16. 16
to Reach the Customer:
Build Awareness
Advertising and Social Media
• Online, Print, External (billboards)
• Blogs, Twitter, LinkedIn, SpiceWorks, Wikipedia, SlideShare, etc.
News Articles and Product Reviews
• Tech enthusiast press (SSD Review, Tom’s Hardware, etc.)
• IT Decision Maker press (Computerworld, InformationWeek, etc.)
• Business press (WSJ, Bloomberg, NY Times, SF Chronicle, etc.)
Industry Analyst coverage
• Gartner, IDC, Forrester, etc.
18. 18
to Determine the Level to Staff the Team
Revenue
R&D$
Sales&Mktg.
Headcount
SalesHeadcount
Mktg.Headcount
Sales:Mktg.Ratio
Sales&Mktg.$
SalesMktg.%of
Revenue
Revenueper
Salesperson
Competitor A $135 $53 62 39 23 1.7 $16 12% $3.5
Competitor B $440 $79 387 200 187 1.1 $101 23% $2.2
Competitor C $221 375 194 181 1.1 $99 45% $1.1
Competitor D $191 $66 115 66 49 1.3 $27 14% $2.9
Competitor E $503 $151 260 142 118 1.2 $72 14% $3.5 Mature / Harvest
Growth/land grab
OEM centric
Declining revenue
Industry benchmarking for staffing the Sales and Marketing effort
19. 19
Segment Sub-segment Database MemCached Virtualization Nearline Archival Workstation
Transaction
(OLTP)
Analytics
HyperScale
Datacenter
Web 2.0 High High High High
Cloud High High
Large Enterprise High High High
Medium Enterprise High High
Small Enterprise
Pro-sumer Medium
…
to Target:
EndUserSegmentation/Focus–GoToMarket
Requirements:
• Dedicated business/tech sales per
major account
• Dedicated support team, on par with
Tier 1 OEM
Requirements:
• OEM co-marketing to scale efficiently
Requirements:
• Build direct engagement, by vertical/geo
Need right product, partners, proof points, reach, sales, fulfillment, support to win in each
segment
20. 20
Segment Sub-segment Database MemCached Virtualization Nearline Archival Workstation
Transaction
(OLTP)
Analytics
HyperScale
Datacenter
Web 2.0 High High High High
Cloud High High
Large Enterprise High High High
Medium Enterprise High High
Small Enterprise
Pro-sumer Medium
…
to Target:
EndUserSegmentation/Focus–Product
Geo Vertical
Finance Media HPC Telco …
US
EMEA
China
Japan
…
Flash Usage Storage Model
Server Ext. Storage
Cache
Primary Storage
Where Marketing team will further define
21. 21
Do They Buy?
• OEM System Vendors
• Procurement & Qualification Engineers Acquisition Cost & Specs
• System Architect & Business Leaders App Performance, Reliability, TCO
• Traditional Data Centers
• Data Center Managers Meeting SLAs through Performance & Uptime
• Line of Business owners Meeting business objectives, IT as enabler
• Web 2.0 & Cloud Data Centers
• Acquisition & Operating Cost
• Acquisition & Operating Cost
• Acquisition & Operating Cost
22. 22
Index of Brand Selection, Marcomm and Sales Effectiveness Criteria Regression to Likely to Buy
307
185 167
139 139 123 116 113 94 91 88 75
283 270
171
122 121 120 106
77 72 72 63 52
Flash/SSD’s Key Criteria That Drive Intentions—IT and Line-of-Business
IT Criteria
Line-of-Business Criteria
Product
Evaluations**
White Papers** ROI* TCO* Customer
Testimonials**
General Events/
Conferences*
Post-
Purchase
Support*
3rd Party Rec.* Value* Case Studies** Ease of
Doing Business*
Ease of Use*
Case Studies** Thought
Leadership*
Post-Purchase
Support*
Quality/
Reliability/
Uptime*
Industry
Knowledge**
*
Product
Evaluations**
Bringing in
Experts***
Ease of
Integration*
Support by My
VAR/Reseller*
Sales
Creativity***
Technical
Knowledge**
*
TCO*
Sales Effectiveness
Marketing Effectiveness
Key Purchase CriteriaB BBA A
A B B B BB B
Source: Tech Buyer Intelligence Reports | Spring 2013, Wave Two
Information do Buyers Need to Buy
Source: Silicon Valley Product Management Association| March 5, 2014 Milpitas, CA
23. 23
to Pursue Which Customers
• Focus on a critical few solutions and locations where we can build a full
value chain
• Horizontal and Vertical solutions where our products demonstrate
a clear benefit
• When we see a sizeable Total Addressable Market (TAM)
• When the current pain point of the customers compels them to invest in adopting a
new approach
• When we have established ISV certifications and partnerships
• In geographic locations where partner and Sales and Field Engineers are staffed and
trained in the enterprise products, ISV solutions and the language customers use to
describe their business
• Achieve success, then expand
24. 24
8 Fundamental Keys to Success
1. Ensure your CxO suite and Board of Directors are committed to the
Enterprise business for the long haul and goals are aligned
You have to earn the trust of Enterprise customers – they are making 5-
10 year commitments when buying and integrating your product or
service into their infrastructure
Make sure everyone has a common definition of Enterprise
25. 25
8 Fundamental Keys to Success
2. Trying to grow Enterprise “DNA” internally is difficult and will take
many, many years to get it right.
It is easier to import Enterprise DNA by acquiring some existing
Enterprise providers or staff and setting them up to run their own
operations.
Avoid the temptation to functionalize the operations out of the broader
company, e.g. developing both Consumer and Enterprise software out of
the same team, doing both Consumer and Enterprise sales out of the
same team, etc.
26. 26
8 Fundamental Keys to Success
3. Pick a business that has an expanding customer need
e.g. Growing economic region, expanding industry, underserved market
4. Ensure you have a technology or service that is sustainably superior
to the status quo or alternatives
e.g. Higher performance, more reliable/secure, better value
27. 27
8 Fundamental Keys to Success
5. In Enterprise, the Sales infrastructure is just as important as the
Product. Enterprise requires a different mindset than Consumer.
Best to hire Sales talent from other proven Enterprise providers rather
than trying to re-train existing Consumer Sales folks
6. Enterprise Channel and ISV Partners are a key catalyst to success
They already know the Enterprise customers and can provide a halo of
credibility when they promote and certify your offering
28. 28
8 Fundamental Keys to Success
7. Cover all the right communication avenues to build awareness and
influence
Gain trust with the customer’s CxO suite/Business Unit leadership and
those that approve the purchase in addition to those who will actually
use the product or service
There are many stakeholders in the mission critical enterprise and each
has their own trusted information sources
29. 29
8 Fundamental Keys to Success
8. Focus on selected markets and build success in steps
You can’t conquer the world successfully all at once.
Speakers note: this oral statement to be read before each presentation. But, instead of reading the entire content on this slide, the speaker may recite the following statement: “Today's presentation includes forward-looking statements concerning future events, trends and projections. Actual results may materially differ from these forward-looking statements. We refer you to our most recent forms 10-K and 10-Q, filed with the SEC, for a discussion of factors that could cause our results to differ.”
Key messages:
SanDisk is a global leader in flash storage solutions
We are a world class, global company
SanDisk has a solid financial foundation with significant R&D spending to ensure our continued technology leadership
9
Pervasive computing means large growth in data produced. This data must go somewhere.