*Those who’ve worked it through include a multi-billion dollar powerhouse, a two-person lifestyle business, and some pre-revenue start-ups.

For the strategy worksheet, I took the extreme position that every employee of every IT vendor should have at least some idea of the answers. In this case, I won’t go quite that far. But I will say that most IT vendors will find most of these questions to be of great importance. So no matter what your role in the organization, you might find it helpful to see how much of this stuff you actually know.

And if you’re the CEO, you should score 100%.

Once again, for reasons of length, I’ll summarize up top and comment on each question below.

Marketing and business development

Relationship development: We invest ____________________________ in building personal relationships with ______________________________.

Awareness: Beyond that, we build awareness by ____________________.

Our people responsible for social media are ___________________.

Lead generation: We get leads by _______________________________.

Repeat marketing: We market in support of repeat sales by ___________.

Sales

Qualifying prospects: Our prospect qualification criteria are ___________.

Sales cycle: The length and effort of our sales cycles is about __________.

Sales productivity: A sales team can generate ______________________ in sales annually, after a ramp-up time of ___________________________.

Repeat sales process: Our repeat-business sales process is ___________.

Technology and delivery

Development (weaknesses): Our plan for fixing our technical weaknesses is ________________________________________________________.

Development (strengths): Our plan for extending our technical lead is __________________________________________________________.

Support: Our support organizations look like ________________________.

Manufacturing and/or service delivery: We make our stuff by _______.

Finance and human resources

Cash flow: We expect to spend _________________________________; our operating cash intake could be as low as ________________________.

Investment: Our plan for getting investment is _____________________.

Hiring: Each hire consumes _____________________________ resources.

I’ll explain some of what I mean.

Marketing and business development

Relationship development: We invest ____________________________ in building personal relationships with ______________________________.

Suppose you’ve done everything right in strategic messaging, and come up with an awesome story that people will believe. How do you cash in?

It all starts with personal relationships — with (potential) investors, with (potential) partners, with prospects, with influencers of all kinds. As I noted in the strategy piece:

Few people get their impressions about you directly, mainly:

• Core influencers with whom you maintain significant personal relationships.
• Existing customers whose impression of you comes almost solely from how you perform in their account.

Almost everybody else gets their impression of you refracted through influencers.

Given that, influencer-relations is a make-or-break challenge. Often, several categories of influencer (for example partners, press, analysts, and self-appointed evangelists) are central to the business mission, perhaps for several different reasons.

Awareness: Beyond that, we build awareness by ____________________.

But business isn’t just done one-to-one. You need to build broader awareness, if for no other reason than to prime the pump for future one-to-one interactions — such as sales cycles. Advertising (especially online), trade shows (ever less), mailing lists — even the abominations that are press releases — all can have their place.

Prudence is a virtue when building awareness. Cost-effectiveness is key. So is not-screwing-up; there are a lot of ways that careless marketing can undermine your story, your image, your messages, and your chances of success. But don’t take prudence to the too-common extremes of blandness, mushiness or neglect. Marketing is an arena in which fortune favors the bold.

Our people responsible for social media are ___________________.

Companies are confused about how to use social media. That’s the smaller problem. The bigger problem is that, even when they understand approximately what to do, they don’t muster the resources and staying power to do it.

My biggest social media tip is this: Empower multiple, selected (or self-selected) employees to engage in social media for you. By “social media” I mean blogs (your/their own), blog comments, forum posts, and Twitter, to start with. By “empower” I mean:

• Actively encourage or even recruit them.
• Don’t burden them with approval processes and the like.

The most fertile ground to recruit bloggers and the like may be in your pre-sales support group, since pre-sales support people are professionally required to:

• Know how to communicate clearly.
• Be knowledgeable about specifics.
• Be credible.
• Know the limits of what they are or aren’t permitted to say.
• Know how to avoid giving offense.

If you leave social media to senior executives and/or marketing staffers, it’s probably not going to happen to nearly the extent it should.

Lead generation: We get leads by _______________________________.

For most sales models, it is necessary to generate leads. Lead generation overlaps heavily with a subset of awareness-building, but it is emphatically not the same thing. It’s more reasonable to say:

• Lead generation starts with the part of awareness building that can capture information about potential customers …
• … and then adds machinery for tracking and follow-up.

Please note that leads aren’t just measured by quantity. Quality is a much more important metric — the point of a lead is to kick off a sales cycle that has good chances for success.

Repeat marketing: We market in support of repeat sales by ___________.

Repeat sales are a whole different animal from initial sales. If nothing else — by definition, there’s only a limited universe of potential repeat buyers.

Sales

Qualifying prospects: Our prospect qualification criteria are ___________.

Most sales cycles die before they start, and that’s a good thing. A crucial sales skill is “qualifying” prospects — i.e., determining which are worthy of the large investment a full sales cycle takes. Your qualification template is a filter for sales cycles; those that get through should, on average, produce revenue well in excess of their cost.

Sales cycle: The length and effort of our sales cycles is about __________.

Enterprise sales is a process, which goes through a typical series of steps, which have predictable delays. An experienced sales manager coming to a new start-up might mis-predict average sales cycle length by a factor of 1.5-2. She will not, however, be off by a factor of 5.

Sales productivity: A sales team can generate ______________________ in sales annually, after a ramp-up time of ___________________________.

One of the key metrics in running an enterprise IT business is sales productivity, which equates roughly to

(Win rate) x (Revenue per successful sales cycle) x (Sales cycles per team per year).

Also important are the cost and composition of a sales team, and how long it takes them to achieve their expected level of productivity. When I encounter management teams that don’t understand these basic concepts, snark can ensue.

Repeat sales process: Our repeat-business sales process is ___________.

A large fraction of an IT vendor’s business comes from repeat sales. So does an even larger fraction of profits, where by “larger fraction” I mean a number that can easily exceed 100%. So it’s crucial to do repeat sales well.

Key differences between repeat and initial sales include:

• Repeat sales may require buy-in from more customer personnel, or from less enthusiastic ones, than do initial sales. Fortunately, you also have a lot more in the way of an account relationship to help you work toward that approval.
• Repeat sales cycles are heavily informed by your customers’ experience with your products … and with your support organizations … and with the match or lack thereof between your promises and your actual deliveries.
• The best salespeople to “hunt” new accounts are often not the best to “farm” established ones.

Technology and delivery

Development (weaknesses): Our plan for fixing our technical weaknesses is ________________________________________________________.

Some competitive liabilities, what not precluding initial success, inhibit you from expanding your market footprint past a certain point. So what you do in sales and marketing is hostage to your efforts in technological catch-up.

Please note that catch-up may be a different kind of engineering, requiring different kinds of management, than is needed for initial creation of something cool-but-fragile. What’s more, the schedule of problem-fixing can be hard to predict — if you knew everything about how to fix your product problems, you wouldn’t have designed them in in the first place.

Development (strengths): Our plan for extending our technical lead is __________________________________________________________.

Few IT vendors are blessed with truly stupid competitors, and so your biggest technical advantages won’t be as big forever. Software vendors may try to act on multi-year forward-looking development plans while still allowing for reactive catch-up. Hardware vendors more typically build and finish discrete product lines. But no matter what you’re developing, you have to be sensitive to a lot of other people’s priorities and timetables.

Support: Our support organizations look like ________________________.

An IT vendor has to be good at post-sales support. Period. An IT vendor that isn’t tiny also has to be efficient at support. And you have to be flexible with respect to just what it is that you’re good and efficient at, for reasons including:

• Pre-sales support is commonly crucial.
• Post-sales support can provide key insights for repeat sales, and for sales and marketing in general.
• Business models for post-sales support can change over time.

This all just becomes more true in the open source world, where the software itself is commonly free.

Manufacturing and/or service delivery: We make our stuff by _______.

Support aside, “How exactly are we getting the results of our engineering to customers?”
may not be a big question for software products vendors. But it’s indeed major if you’re offering hardware, appliances, and/or some form of SaaS (Software as a Service). Going completely inhouse is rarely the best choice — but no hosting solution is ideal, and neither is any hardware OEM or contract manufacturer.

Finance and human resources

Cash flow: We expect to spend _________________________________; our operating cash intake could be as low as ________________________.

A basic rule of business is “If you run out of money, you’re out of business.” So you need to plan for your reasonable worst-case cash flow. Cash flow, of course, equates to the difference between cash in and cash out; of the two, incoming cash is usually the harder to predict.

Investment: Our plan for getting investment is _____________________.

If you don’t need money, and never will, congratulations. Otherwise, little is more important than getting it when — or preferably before — you need it.

Hiring: Each hire consumes _____________________________ resources.

Hiring is a huge part of what you do. It consumes substantial time for sure, especially but not only from management. It may also consume significant cash. And once somebody is hired, training is a big deal as well.

If you don’t have a hiring and training plan, then you probably don’t have a growth plan at all.

Recently, I got into a flap with EMC Greenplum. I blindsided them on a story; they retaliated for the story by, among other things, screwing me over business-wise. Why did I blindside them in the first place? Because I believed that if I didn’t, they’d put me under intense pressure not to publicize news I’d obtained. (Given the punishment they dished out for my running it, I imagine my belief was quite correct.)

Meanwhile, here are excerpts from a post I drafted last year, but never ran: 

It’s getting ridiculous. Two different large companies have accused me in internal communications of breaking embargoes this year, and in neither case did they give me any kind of briefing with the information! In one of the two cases I published something I’d been told by a competitor of the company’s. In the other case I simply posted a link to a public story. These weren’t cases of getting information from the companies and having it reproduced by outside sources; I got information from the outside sources, period, without the vendors’ cooperation.

Now, the flip side of such stories is that I have good enough relationships with those companies to discover the internal lies. And business must go on, which is why I’m not naming the companies in question. Still, I can’t imagine any benefit to these vendors from internal dishonesty. And I have to wonder about the wisdom of putting untruthful people in jobs that involve gaining outsiders’ trust.

And I could have drafted a similar one the year before that, with “NDAs” in the place of embargoes.

Of course, it’s not just news — companies get upset by people who offer opinion as well.

When news is minor enough, that’s unavoidable. But in this case and others I would have willingly been briefed (scheduling just got a bit awkward this time). The two lessons here are:

• Brief the people who will be called for quotes before you brief the press, and therefore …
• … know who the press is likely to ask for quotes.
  

*By the way, that means an intriguing New England startup needs a new PR firm. By tomorrow it should be obvious who I mean.

It started as an ordinary kind of bad pitch. The PR rep emailed offering a briefing with a mystery company. I immediately deduced that the company was one I was in fact set up to talk with today, and had indeed been writing about since 2009. Besides being annoyed that I’d had to scramble to set up my own last-moment briefing with a company I’d led the way in writing about, I also bristled at the fact that the pitch included quotes from a couple of my competitors, whom I shall unimaginatively refer to as Dave and Merv.* So far, no big deal.

*Both personally and professionally, they’re two of my favorites. Even so, I dislike being told that I should use them as authority figures to be copied in my own view formation.

But then it occurred to me that those quotes probably weren’t approved, but instead were just lifted in an unauthorized manner from conversations, and indeed probably didn’t reflect the analysts’ precise views. So I messaged Dave and Merv. Shortly thereafter, the PR rep emailed me:

Neither David or Merv have authorized the quote for publication.  It was sent in error to you, as I had believed you had agreed to the sharing of confidential information.

The bulk of my response to that — and the essence of this post — was: 

… there are quite a few problems with that response. You didn’t even tell me the name of the company you were writing about, let alone that the information was supposedly confidential. Indeed, by using the “if you agree to an embargo” formulation, you if anything implied that the contents of what you’d told me so far were non-confidential.

What’s worse, even if you had had assurances of confidentiality from me, your unauthorized use of Merv’s and Dave’s quotes was unethical for several reasons. Since you didn’t ask them for permission, you had no way of knowing whether those were their reasoned opinions — as opposed to, say, off-the-cuff comments or even a bit of flattery. Thus, you created the possibility of making them appear to hold opinions they in fact do not, which would be harmful to them, and also of giving me a false impression. What’s more, analysts can be picky as to who they give their opinions to, and what’s said to a company is not necessarily to also be shared with, say, one’s closest competitors.

It got even worse from there, e.g. when we figured out that similar unauthorized quotes had gone in email to the press, or that Merv had been explicitly asked for permission to use his quote (denied as per company policy). Such flourishes just make the incident even more epic in its awfulness.

And that, kiddies, concludes today’s class on how NOT to do analyst and public relations.

I jumped into an #ARchat on Twitter Tuesday, and set off a discussion about the subject of analyst quotes in press releases. Since that chat has been blogged, starting with a partly accurate* paraphrase of my views, I figure I may as well state those myself. 

*I don’t know what the “own marketing team” part refers to.

Our write-up of Monash Advantage terms and conditions states that membership includes:

Eligibility for press release quotes, subject to our usual integrity requirements (we write the quotes ourselves, and only on subjects we feel sufficiently favorable about). We do not charge for these.

Actually, you don’t have to give us money to get a quote from me, as this Tokutek example shows; but if you’re not a client, then you have to make the process very easy. For example, I dictated that Tokutek quote while in a car to the airport, at no cost to my workweek.

Other analyst firms have different approaches to quotation pay-for-play. Does this all mean that analysts are more likely to be seen as endorsing companies who pay them? Frankly, yes. But truth be told, analyst pay and implicit endorsements are partially linked no matter what.

The real issue, in my mind, is that analysts should only give quotes that truly reflect their research. I had a Twitter exchange once — with an analyst I basically like and respect — that in effect went:

• “Why do you think X?”, where X was a quote in a press release that:
  • Sounded like it had been written by a marketing department.
  • Was on a subject that analyst wasn’t particularly expert in anyway.
• “What do you mean?”
• “You said X in company Y’s press release.”
• “Uhhh … I don’t really know what you’re talking about.”

Obviously, the analyst had just approved a quote routinely, whether to be nice or to get press visibility, without seriously reflecting on what it actually said.

I find that appalling.

It is widely believed among analyst relations professionals that one should engage the services of the analysts most influential in one’s industry, in the hope that the analysts one pays will speak well of one’s company, publicly or privately as the case may be. Thus, the best way for an analyst to make money is:

• Become influential in the industry s/he covers.
• Say nice things about the companies in it, especially the ones with larger budgets.

On the whole, I think I do better at the first of those tasks than the second.

Sometimes the connection between money and saying nice things is pretty blatant. For example, I’m often asked “Hey, would you be interested in doing a white paper that highlights our product’s advantages?” Unfortunately for my bank account, I almost never think it’s a good idea to accept the commission. It’s not that I dispute that it is possible to be ethical when writing white papers. I just don’t find it easy. And frankly, even analysts I regard as ethical commonly turn out white papers with somewhat more bias than I like to see in documents carrying my name.

Even more directly, I’m occasionally grilled to the effect “Is your view of us sufficiently favorable that we should retain your services?” Those discussions generally don’t end up in a paying relationship, but so be it; the companies who do that aren’t clients I’d much enjoy having anyway. More discouraging right now is that the two Monash Advantage members I’m having the most trouble renewing from last year are two of the ones I’ve written the most pointedly skeptical things about, creating a $80,000 hole in my expected revenue run rate, and keeping me from helping some people I’d grown to think of as friends.

Other times the money/praise connection is more subtle, involving part or all of the sequence:

• Analyst gets paid for services –>
• Analyst learns more about the vendor and its products –>
• Analyst is more confident in any favorable opinions about the vendor and its products –>
• Analyst finds it easier to write and talk about the vendor and its products –>
• Analyst takes the trouble to write and talk about the vendor and its products –>
• The fact that analyst takes note of the vendor and its products is perceived as an endorsement.

It is, frankly, hard to avoid being a part of that. I think I’m pretty strict about following my rules for credibility in what I say. But with only a limited number of hours in the week, it’s hard not to be biased in the choice of which subjects I take up in the first place.

And so I’ll close by calling your attention to what I wrote five years ago about sources of analyst bias, and excerpting part of it below. Upon rereading it, I stand by almost every word, except that our client list has of course changed significantly in the interim.

1. Good vendor relationships are an important factor in an analyst’s success. It’s not just revenue; you also need access to information. This is true whether you’re a stock analyst or an industry analyst. …

2. Analysts typically have more confidence in the companies that are their paying clients. I honestly call ‘em as I see ‘em, no matter who is or isn’t paying me. But some of my calls have to do with confidence. And who will I be more confident in? Company A, which has disclosed almost all their current activities and intermediate-term plans to me, and has given serious consideration to expensive advice they’ve paid me for (and hopefully done something with the advice)? Or Company B, with whom my relationship is largely being fed marketing pabulum, with only the occasional renegade getting off the reservation and telling me what’s really going on? Obviously, it’s often Company A. …

3. There’s a reinforcement cycle that confuses questions of bias. Companies give money and attention to analysts who are positively inclined towards them. They buy consulting services from analysts whose worldviews are compatible with theirs. The resulting relationship, if it goes well, reinforces everybody’s positive opinions of each other.

Meanwhile, companies give cold shoulders to analysts who don’t like them. And that just reinforces analysts’ opinions too.

1.  The terms “ethics” and “ethical” are used somewhat inconsistently, along a spectrum from:

There are procedural rules of good behavior, and if you violate them that’s bad. That’s the essence of ethics.

to

Unless the motive was impure, an act was not unethical.

Either extreme, in my opinion, quickly leads to nonsense.

2. Actually, I think calling that a spectrum is a bit misleading. I’d prefer to say an act is unethical if:

• It is (too) likely to have bad effect AND
• The perpetrator was guilty of bad behavior in not acting differently.

Thus, somebody can make an error in the area of ethics and still be fully ethical if, upon realizing it, they straightforwardly correct it. On the other hand, a pattern of such “errors” can suffice to convict them of unethical behavior.

3.  In particular, I stand by the following views from the post and comment thread that set this all off:

• Oracle behaves unethically by repeatedly foisting off sponsored analyst content as independent research.
• Merv Adrian is a fine, ethical guy.
• One reason I believe Merv is an ethical guy is because when I pointed out a screw-up to him, he characterized it as an oversight (I believe him) and said he’d move quickly to correct it.
• Commenters in that thread who suggested I shouldn’t even have mentioned Merv’s error were out of line. When you make an innocent mistake, you may suffer some embarrassment as a result.

4.  Merv’s analysis of white paper ethical issues was excellent, and supersedes mine. Continuing the oneupsmanship , I’ll now try to synthesize by saying: 

• White papers should never give a misleading view of the analyst’s opinion. Therefore:
  • They should always be prominently labeled as to sponsorship.
  • They should never be quoted out of context (a longstanding rule of mine that Merv thankfully also enforces).
  • They should always be clearly dated (a point I forgot to mention before).
• Merv points out that many companies have the same specific failing I lambasted Oracle for. While I think Oracle is particularly egregious, I don’t dispute his general observation. What’s more, since a white paper has many possible routes to get to an individual’s desk, the only reliable protections are those embedded within the paper itself.

5. In my post on white paper ethics, I confessed that I knew little of practices in sponsored podcasting. Eric Kavanagh helpfully filled me in on how he does it, tweeting

DM Radio is not pay-2-play; sponsors get leads & commercial but no editorial preference; enforced by tag team of me & Ericson.

and

Several rules: no product promotion; we talk business, tech, architecture, how-why-when stuff; I do a pre-call with ~all guests.

and

The policy is unscripted dialogue; in the pre-call, I tell guests to think of 3-4 key points they’ll make; no questions banned!!

6. I am generally appalled by the behavior of certain companies toward analysts, and their efforts to control what analysts say. Practices include:

• Demanding a review cycle on anything the analyst writes about them, sponsored or otherwise.
• More generally, heavily tailoring access not just according to an analyst’s importance (by whatever measure of importance or influence makes sense to them) but also pliability.
• As noted above, mischaracterizing the nature of analyst research.
  

Oracle is generally reputed as the worst offender, but while I agree with the criticism in general, I’m somewhat mellowed by the fact that I, personally, still have good access to key Oracle product people at important times.

As for Microsoft, on the other hand … well, let’s just say the best insight I’ve gotten from my back channels to date has been to find out exactly what falsehoods were being circulated about me in internal Microsoft communications. I also frankly am steamed at the moment that a Microsoft exec had the nerve to tell me that I shouldn’t post about ethical issues (a dictum I obviously have no intention of adhering to).

7.  It absolutely is possible for companies to change their analyst relations practices, both for better and for worse. The most dramatic positive change I recall is when, in the mid-1990s, Sybase went fairly quickly from utter dishonesty to having one of the best analyst relations guys ever (Dave Taber, when he had that role for them). In a slower evolution, IBM — which once filed a $7.5 billion lawsuit naming a Gartner Group analyst as co-defendant — has become pretty reasonable (even if large and bureaucratic) to deal with.

In the traditional model of IT analysis, vendors and users alike buy subscriptions to published research that are bundled with a certain level of retainer-like consulting. You can also buy additional consulting from analysts on an ala-carte basis. Indeed, analyst relations gurus suggest it’s a best practice to do so, both because you might learn something and because the process of your doing so might strengthen your relationship with them, in reality and euphemism alike.

In the 1990s I subverted that model somewhat. Anybody could buy my subscription newsletter for $347/copy/year. Only two vendors that I recall (Oracle and Informix) ever bought > 10 subscriptions at once. In addition, I had some faxed published product that frankly didn’t add all that much to the newsletter. But it was part of a $15,000/year service – almost always sold to vendors only — that also included a day of consulting and related prep and follow-up, a price point I stumbled into and later in various ways validated.* Big companies like Oracle and Microsoft were encouraged to buy, say, one unit of service each for the DBMS and application development tools groups. If one group wanted more service, they could pay 2X as much, while getting the same faxed reports. Thus, in most ways but not all, I separated out my subscription business ($347/seat/year) from my consulting business ($15,000/episode for vendors, custom-priced for users) even then.

*Institutional investors got their own price points, and a truly retainer-like service model. But as my old customers in that area fell off through usual turnover-related churn, I got almost no new ones, and it eventually became a minor part of my business.

In the blog-friendly 21^st Century, I’ve taken those principles further. Substantially all my research is free-to-the-public. Most of what I sell is directly packaged as some form of consulting. (The exceptions would be sponsorship for the research and its distribution, most commonly in the form of paid speaking engagements). For vendors this is retainer consulting only. For users it is project consulting only. For investors I would be flexible on retainer vs. project, if I had any remaining investor clients. But one way or the other, it’s all consulting. In my “freemium” analyst business model,

the research is the “free” and the consulting is the “ium”.

But enough about me! While the market opportunity for hard-core analysts is fairly limited (there isn’t much point in trying unless you think you can become acknowledged as a top expert in one or more fields), it’s in fact a business best practice for almost any consultant to show off expertise by blogging or some other kind of publication. Now, not all of this expertise-parading need be on subjects general enough that we’d recognize it as being a form of what we generally call “IT analysis.” But much could be or is. Therefore,

many consultants are or should be part-time analysts.

If you go back to my tentative taxonomy of influencers, I’m looking at people who fit into Bucket #4 (minor bloggers or forum posters), but might transcend that to seep into Buckets #1 or 3 (two groups of “analysts”). Obviously, these aren’t the only kind of rising influencers. For example, a top blogger in my sphere is Daniel Abadi – he’s a professor, but if you can get him to take the time to behave as an analyst vis-a-vis you, something he only rarely does, you probably should. And then there’s Dave Kellogg, CEO of a vendor, on the board of others, and clearly not always objective – but usually interesting and insightful even so. More common in the future, I think, will be examples like Todd Hoff – a consulting programmer with an excellent and widely read blog.

Today, if a user or other techie tells me I have “one” of the best blogs in the (database or perhaps unspecified) field, and I ask them what the other top ones are, the answers I expect to get back are Hoff’s and Abadi’s. Of the two, Hoff’s sends more visitors to my blogs, so I’m guessing it’s the better-read. Vendor business types might cite Dave Kellogg’s or Merv Adrian’s instead.

The implications of all this for influencer outreach efforts should be pretty clear. I’m still trying to think through what it means for analyst business models. Stay tuned.

]]> http://www.strategicmessaging.com/blurring-analyst-consultant-line/2010/07/28/feed/ 2 http://www.strategicmessaging.com/so-what-is-an-analyst-anyway/2010/07/25/ http://www.strategicmessaging.com/so-what-is-an-analyst-anyway/2010/07/25/#comments Mon, 26 Jul 2010 04:42:50 +0000 Curt Monash http://www.strategicmessaging.com/?p=98 Recently, there have been several high-profile (at least within the independent analyst community) posts and initiatives relating to analyst business models. Each at least implicitly suggests a definition of what an “analyst” is. Interestingly, no two of the definitions seem exactly the same – even though similar people are involved in several of the efforts. Notwithstanding my well-documented skepticism about category definitions, I think it might be interesting to pull some of these ideas together in one place.

The post that kicked this all off, by Gideon Gartner and Barbara French, basically asking whether and how small analyst firms could rise to challenge the big ones like Gartner Group and Forrester Research. An extremely rich comment thread ensued. Implicit in the original post was a definition of “analyst” work that seemed to include both proprietary published research and quick-hit advisory services, fitting the traditional big-firm subscription model. More diversity, however, was shown in the post comments.

Long ago, Gideon probably based his model on his prior career at stock research firms, which to this day model their business somewhat like big IT analyst firms. Some of the main differences are:

• Payment levels and services provided sort of just happen, rather than being precisely negotiated.
• Payment style is wonky, mainly consisting of a certain share of a client’s high-margin rather-commodity-service stock trading business.
• SEC regulations insist that you not say anything material in personal advisory services you haven’t first put out in writing (there’s been decades-long uncertainty as to just what is or isn’t “material”).

Note: I used to be a stock analyst myself. Indeed, I once was ranked #1 on the Institutional Investor All-Star Team. This may be only the 3^rd year in the past 29 that I get $0 revenue from investment research – and it’s not over yet.

My immediate reason for writing this post is that Ray Wang of Altimeter Group asked me to retweet his post on the best way to set up a new analyst firm, broken down into “7 Tenets”. The implicit model he’s using of analyst firm seems to be one that does a lot of advisory services, probably sells subscriptions, has “proprietary IP”, and gives a lot of research away via blogs and other public outlets. I.e., it’s similar to Gartner/Forrester, but not quite as rigid. Anyhow, I know Ray isn’t really that dogmatic, because – as he tweeted recently – he’s exploring a possible “trade association” of independent analyst firms, and I’ve talked with him about who might be in or out.

In my own business, I follow a more extreme form of the “freemium” model. In line with my stock analyst background, I feel anything I know that’s sufficiently important should be published openly, technology insight and general methodology alike. Advisory services are for:

• Teaching people how to use the information.
• Being the middleman for 1-to-1 NDA vendor/user discussion.

I’ve figured out how to offer quasi-subscription retainer vendor services even so, but find it easier to sell user services on a project basis.

Of course, I don’t really publish EVERYTHING openly, for three main reasons:

• Nobody has time to write up everything they know.
• Much of what I know is NDAed.
• My best advice is reserved for my paying customers.

But that held-back advice is not apt to be a market trend or analytic methodology. Rather, it is likely to be a more specific “Due to threat, opportunity or trend X, you should do Y,” where X is something I’ve actually been writing about publicly for a while.

Jonny Bentwood, meanwhile, goes to the opposite extreme from Gideon et al., defining an analyst by

if someone is independent and directly influences technology procurement then they are an analyst

That leads, for example, to him ranking Dennis Moore as a top-100 analyst tweeter. Now, I have no problem with mentioning “Dennis Moore” and “top-100 analyst” in the same sentence. But if Dennis has any analyst business model at all, it’s one of the stealthiest ones in the whole IT industry.

Finally, there was a webinar by French, Bentwood, Ray’s partner Jeremiah Owyang (who’s #1 on most of Bentwood’s lists, except for the ones Ray’s #1 on), and Carter Lusher on analysts’ use of social media. I haven’t listened to the recording, but two of the four bullet points listed below it say analysts can or should:

Develop personal networks, career brands, that carry with them further than reports under an umbrella brand.

Finally realize they are also media in addition to their traditional roles.

I agree, and in fact believe analysts are a huge part of the media ecosystem, already now and even more going forward.

So what are the implications? If you’re a vendor, I think:

• Analysts (defined broadly) are an increasingly important part of the overall set of influencers. In particular, as traditional media business models collapse, we’re playing some of the role trade press reporters used to.
• You need flexibility in how you deal with influencers. Everybody is different. (Quick worst-practice story: Oracle tells me it won’t give analyst-relations support to anybody who doesn’t let it see what they write before it goes out – a process they use both for fact-checking and general last-ditch opinion-lobbying. But I know they enforce that rule selectively. And I’m not getting good PR support from Oracle these days either.)
• Understand that different analysts can give you good advice in different ways. E.g., numerous clients tell me that they go to Gartner to find out what mainstream enterprises are saying, and to me for actual marketing or strategy advice. (Conveniently, that lets them also be giving money to and getting attention from what they judge to be two of the top influencers in their area.) Other analysts might assist them in yet other ways, even beyond general influencer-relations value.

If you’re a user, please note that:

• There are numerous good providers of free information and insight.
• Many (not all) providers of free information can also be hired as consultants.

Sorry if those bullet points at the end — or for that matter the rest of the post –  sound a bit self-serving, but this overview is in fact informed by thinking about my own business.

Or, to put it another way:

• What I think about the analyst business in general
• How I structure my own business in particular

are, for rather obvious reasons, closely in alignment.

• As a consultant to the technology industry
• As a target of public relations myself

Sometimes these discussions are very fruitful. But other times they are “Head, meet brick wall.” Perhaps this post will help.

This post actually started as a set of specific tips, the biggest of which is uncouple your PR from your press releases. I’ll put the others below — but first, I’d like to cover a little theory.

There are (at least) five different things you can try to do via public relations:

• “Sell” to the press (and bloggers and so on), by which I mean that you try to induce stories, and you probably measure success by a count of stories written (presumably weighted by the quality of the publication, the favorableness of the mention, and so on), and your activities are focused on contacting the press in pursuit of that goal.
• “Market” to the press, by which I mean that you try to create a favorable disposition toward having them say what you’d want them to. This can be measured in the same ways as “selling” success, but usually on a more long-term basis.
• Market through influencers to your end customers and prospects. Here I’m saying “influencers” rather than “press”, because social media, pure word of mouth, and so on can also contribute to success.
• Market through influencers to other influencers. It is now a regular consulting exercise for me to walk clients through the whole chain of which influencers listen to which other influencers. (If you want to work that kind of thing out for yourself, social media observation is a good way to start.)
• Market to potential buyers directly. This has become increasingly realistic as the internet has matured.

In my capacity as a target of PR, I can tell you that clumsy or excessive “selling” of stories creates a backlash. There are a number of us who are LESS likely to write favorably about companies that waste our attention and time pitching inconsequential stories.  You may get ignored (especially in the traditional press or if you’re a larger company).  You may get mocked (especially in blogs and if you’re smaller outfit). Either way, you probably won’t be happy about the result.

In my capacity as a consultant, I can tell you why you should have realized this all along — unless carefully managed, most salespeople will burn their employer’s long-term interests in order to show short-term results. Outside PR agencies on short-term contracts are particularly guilty of this. What’s more, when they are honorable or astute enough to push back against unrealistic management expectations — as is fairly often the case, or at least so they claim — outside PR folks are commonly ordered to produce-or-else nonetheless. The consequences of such bullheadedness are sad.

One of the top trade press reporters covering enterprise technology keeps telling me that he fears for our country if people seriously think that the trivialities he’s hard-pitched are news. Less hyperbolically, he’s given me names of VERY big companies who get less coverage from him than they would if they sent fewer lame press releases. And when he gives me examples of what he hates, I generally agree, except in cases when I can tell him that a terribly-written press release has obscured what is actually an interesting announcement.

A great selling-style PR person can be invaluable, just as a great salesperson is. Those are the ones who know a few target “customers” really well, who are trusted by those “customers,” and/or who know how to listen to what the “customers’” preferences or needs are. Some people like that can be found inside companies.* But they’re almost nonexistent at agencies these days, at least among those folks who pitch me.

*See, for example, Dian Terry’s organization at Teradata. Ditto Rita Shoor, who despite technically being independent might as well have been an Intersystems employee for the past decade-plus.

If most pure “selling” is bad, then what should you do in PR? The answer is “market”. This post will be long enough without me trying to distinguish among the various kinds of marketing — awareness-building, positioning, competitive de-positioning, lead generation, and so on. But I would like to at least point out that there are different categories of people to market to.

In an earlier post, I distinguished among eight different kinds of influencers. For the purpose of this one, it should suffice to highlight three different categories of PR-centric marketing:

• Marketing to generalist influencers in the hopes they will in turn influence the broad market. E.g., instead of nagging a reporter to write a specific story, you can just focus on building up their opinion of you and your technology, in the hopes they will write favorably about you when it fits their needs to do so. When you do this, your end goal should be quality of mentions, with a secondary emphasis on quantity. I put quality ahead of quantity because ever more buyers don’t focus on news streams at all. Rather, they go out and search for information when they feel they need it, and when they’re doing that you want them to see a reasonable quantity of highly favorable commentary, even more than you want them to find a large number of decent mentions.
• Marketing to specialist influencers in the hopes they will influence other influencers, as well as influencing the general market. When addressing specialized “expert” influencers, you should have two end goals — quality of online mention and quality of word-of-mouth mention. This area is even more skewed to quality than the prior one for multiple reasons, including:
  • Specialist/expert influencers have a wider good-to-bad spectrum of commentary than theoretically unbiased reporters do.
  • Even if you don’t see that in print, it certainly happens in private conversation.
  • Their followers are apt to be focused enough to notice what tone the commentary takes.
  • If they have a high opinion of you, quantity will often take care of itself.
  • You probably couldn’t measure word-of-mouth quantity if you tried (although mass consumer markets may be an exception to that rule).
• Reaching out to the broad market directly.  Google News and other aggregators tend to carry press releases right alongside traditional news articles. And a significant fraction of the top search results on your company name are likely to be your own press releases. For that reason alone, I wouldn’t forgo issuing press releases, especially ones with informative headlines and first paragraphs.

With all that as background, let me now turn to the specific tips that started this all off.

• Press, bloggers, analysts, and other influencers can no longer be neatly separated from each other. Only use PR people who can be trusted with all those constituencies.
• If you must use PR people as glorified appointment secretaries, for a conversation that BOTH sides want to have, that’s OK. It’s not ideal, but it’s less likely to actually damage you than some of the alternative approaches to PR are.
• Using PR people to sell a story that the target doesn’t care about is a VERY bad idea. Indeed, it’s commonly worse than using a salesman to sell a product the prospect doesn’t care about. Why? Because there’s more chance you’ll later regret burning the relationship.
• Compensating PR people based on press mentions almost guarantees they will oversell and burn your relationships, unless they are confident they have a long-term relationship with you.  (On your payroll or otherwise.) Otherwise, their short-term motivations are not at all in your best interest.
• The higher your volume of press releases, the clearer your headlines and other writing need to be. The more attention you ask for from each target, the more responsible with that attention you need to be.
• Review pitch emails just as you review press releases. If you do a sufficiently great job of clear headline and topic-paragraph writing, maybe the pitch email writes itself. Otherwise, it’s apt to be botched. A bad pitch email can piss off an influencer even more than a bad press release does, because it often consumes more of their attention. (Vendors really fall down on this point.)
• The worse the press release, the more you need to supervise the pitch process. This is an extension of the previous point. If somebody micromanaged you into a bad release, then you need to micromanage your minions into pitching as if the release had been better.
• And here’s what I REALLY think: Just treat press releases as documents your post online. Press releases get picked up in various places online.  And sometimes they even appear in venues (mainly online) where they look like they’re press articles. So you’re not actually going to stop issuing them. (Sigh.) But the writing you do for your generic online audience is very different from what you should do for reporters and other influencers.

To reach the latter group, the right model is something that’s at least quasi-personal, quasi-straightforward, and quasi-in-depth. In other words, it’s a lot like a blog — or else like a series of truly personal email correspondences. But, given how long this has already become, that’s a subject for another post.

*There actually are a couple of vendors who drown me in press releases without pissing me off. Why? Because those press releases have instantly comprehensible headlines and topic paragraphs. (Typically they’re user success stories without breathless fluff.) I know what I’m ignoring, without having any work to do to ignore it. The reason I mentioned Rita Shoor’s work for Intersystems above is that she’s great at that kind of thing. (Look around my blogs; you’ll see that it’s really rare that I write a story like this one that Rita induced.)