marketing and sales executives from Silicon Valley

Wednesday, March 23, 2011

When it comes to trust, Industry Analysts rule

I saw an interesting article in IT Marketing World that struck a cord. I had been an Industry Analyst in the past, but since I left that occupation, I have heard numerous engineers, IT folks, and even marketers call Industry Analysts all kinds of unflattering names.

Recently, I spoke with a Marketing Director who referred to analysts as if it was a curse to work with them. I said it was no problem for me, since I used to be one. Now I do not hold Industry Analysts in a position of honor or holiness, but I knew then and still know now that they play an important role for technology markets, and it's just good business to deal with them properly.

Why should you care? The article I linked above sums up the issue - Trust.

The article states that a SiriusDecisions survey found that "Industry Analysts and Peers are the most influential and trusted sources of information", with Industry Analysts scoring nearly 3 percentage points higher.

Of course there are other factors in decision making, and the study also cites "favored sources of content", "influencial sources of content", in addition to "trusted sources". Because trust is only one important factor of many, I won't claim that Industry Analysts are the end-all be-all, however I do have some fond memories of lessons learned from being an analyst and what it took to be a good one:

1. Always have a BS filter - As an analyst, companies were always trying to bend my ear to their way of thinking. It never hurts to question motivations.
2. You can position anything - Analyst are wary of every positioning statement, since every company positions themselves, and smart ones position their competitors. Good analysts know positioning well and that this is just part of the standard pitch.
3. What really matters to the market? - An analyst is paid to think beyond spec wars and get to the issues that really matter to customers and the market.
4. No one operates in a vacuum - No matter how good someone's story sounds, the competition is always moving. Sometimes they may even be ahead.
5. The road to hell is paved with good inventions - One of my favorite lines first told to me by Jim Handy (hi, Jim), as it describes the hope inherent in every company pitch. Companies want to build a product or service that solves a problem. Often they fall short and the best product/service doesn't win. Good marketing, bigger marketing budgets, legal wrangling, misinformation, related product momentum, goodwill, or other factors can determine the winner.

I think that good analysts apply the 5 guidelines above and can provide a truly balanced view with limited biases. When they do, the real issues that matter to customers can be addressed, and they can provide a perspective worthy of trust.

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