Posts Tagged ‘Marketing Storage’

I’m chairing what may be the first ever marketing-oriented session at the annual Flash Memory Summit in August 2013. A lively panel of experts, editors, and analysts will be discussing product differentiation in a growth market in a session called: Differentiate or Die – Marketing Flash-Based Storage Systems. So, as part of a primer on product positioning, I thought I’d list the players in the game. In this case, I’ll narrow the field to those competing for enterprise buyers. In most cases, the solution is a hardware product that uses Flash memory, but not always. Some vendors develop software products that mitigate the need for additional hardware, essentially fulfilling the same customer need.

As you can see from the list of 75+ (below), there are enough vendors, products, and brands to make any buyer’s head explode. But if they wait, most will be gone by the end of the decade. A handful will be gone because they won the positioning game with the global players and were acquired for big bucks. Most will just be casualties who could not differentiate themselves in a way that attracted enough customers, or who could not defend their position from competitors claiming the same benefits at a lower cost.

Vendors Promoting an Enterprise Solution that Uses Flash

This June 2013 list (with a July update) includes some newborn vendors (not yet shipping) and some undead vendors (they look dead, but still might bite.) In general, I excluded those selling only hard disk drive form-factor SSDs (e.g Seagate) and Flash chips (e.g. Toshiba, Samsung), but I included PCIe SSD vendors if they claimed to have a product for enterprise servers.

  1. Aberdeen
  2. Amax
  3. Arkologic
  4. Astute Networks
  5. Assurance
  6. Avere Systems
  7. BiTMICRO
  8. BridgeSTOR
  9. Cachebox
  10. Cisco
  11. Condusiv
  12. Coraid
  13. DataCore
  14. DataDirect Networks (DDN)
  15. DataON
  16. DDRdrive
  17. Dell
  18. Dot Hill
  19. Echostreams Innovative Solutions
  20. EMC
  21. Enmotus
  22. Fastor
  23. Foremay
  24. Fusion-io
  25. GreenBytes
  26. Hitachi Data Systems
  27. HP
  28. Huawei Symantec
  29. IBM Systems and Technology Group
  30. IceWEB
  31. Infinio
  32. Imation
  33. Intel
  34. iXsystems
  35. JetStor (AC&NC)
  36. JBOD
  37. JDV Solutions
  38. Kaminario
  39. Kove
  40. LSI
  41. Marvell
  42. Micron
  43. NetApp
  44. Nimble Storage
  45. Nimbus Data Systems
  46. OCZ
  47. Oracle
  48. Panzura
  49. PernixData
  50. Pivot3
  51. Proximal Data
  52. Pure Storage
  53. QLogic
  54. Qsan
  55. Radian Memory Systems
  56. Reduxio
  57. Renice Technology
  58. Runcore SSD
  59. SanDisk
  60. Scalable Informatics
  61. SeaChange
  62. Skyera
  63. SolidFire
  64. Soligen
  65. Starboard Storage
  66. sTec
  67. StorageQuest
  68. Super Talent
  69. System Fabric Works
  70. Tegile Systems
  71. Tintri
  72. VeloBit
  73. Violin Memory
  74. Virident Systems
  75. WhipTail
  76. X-IO

If I missed a vendor, please let me know.

About this Series on Positioning and The Flash Memory Summit

Join me and a lively panel of experts, editors, and analysts at what may be the first ever marketing-oriented session for CEOs, CTOs, and marketers at the annual Flash Memory Summit in August 2013. We will be discussing product differentiation in a growth market in a session called: Differentiate or Die – Marketing Flash-Based Storage Systems on Wednesday, August 14, 9:50-10:50 am. This is an Open Session so you can register for free up until 8/11/13.

You can follow this blog by signing up in the left sidebar. You can find related posts like these by clicking the Flash Memory Summit 2013 category:

  1. Flash Memory Summit 2013 Session: Differentiate or Die – Marketing Flash-Based Storage Systems
  2. Competitive Positioning of Flash-Based Products – A Primer for CEOs, CTOs and Marketers
  3. Market Changes Impacting Flash-based Products – A Positioning Primer for CEOs, CTOs and Marketers
  4. Positioning and Hype for Flash-based Products – A Primer for CEOs, CTOs and Marketers

You can suggest questions and discussion topics using the comment box below or by sending me, David Lamont, an email at blog [at] marketingsage.net. If you’d like to support this topic and enhance your own social media reputation, please click the “Share This” and “Like This” buttons below. Your support is appreciated.

About the Author

David X. Lamont is an accomplished marketer of IT products and a partner at Marketingsage, a PR and lead generation firm that specializes in marketing data storage, data management, and enterprise software products. He can be reached by email at blog [at] marketingsage.net. Fellow marketers and IT professionals are invited to join his network on LinkedIn and to subscribe to this blog (see sidebar).

 

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Here’s a situation that’s not uncommon when selling enterprise storage or data management products: a firm generates an increasing number of marketing-qualified leads, but the percentage, or even the volume, of sales-qualified leads drops. Obviously, the quality of the leads should be questioned. But what if the lead sources are the same? Why are the new leads not as good as the old leads?

Before you kill your marketing programs you should look at your December data (or any other short month for business). You’ll likely find a very a strong correlation between the time the salespeople spend actually talking with prospects and the number of sales-qualified leads. In other words, if the salespeople are not connecting with prospects, leads will not convert from marketing-qualified to sales-qualified. The number of man-hours dedicated to talking with prospects, and the quality of the initial sales pitch, are far more likely to determine the number of sales-qualified leads than the source of the lead. The holiday season can highlight this often overlooked fact, especially if you don’t track the actual number of sales conversations.

Unfortunately, the sales bottleneck is not always recognized, especially when many marketing programs are running and evolving at the same time. It’s easier to conclude that a marketing campaign is failing, or worse, that marketing as a discipline does not work.

It’s natural to assume that if you increase the number of marketing-qualified leads, the number of sales-qualified leads will increase at the same rate. However, that is only be true if the sales team also increases its bandwidth to process them.

Think about the logistics (optimistic for complex/expensive IT products): A salesperson with time for qualifying leads makes an average of 60 calls per day. With an average of 3 attempts required to reach a prospect, they can talk to 20 prospects per day. With an average of 17 dialing days per month, one dedicated salesperson can talk to 340 prospects. If 5% have an open project, budget and authority the salesperson would convert 17 marketing-qualified leads to sales-qualified leads per month. Put another way, that’s 17 sales-qualified leads per 1020 dials assuming you have a large team of salespeople and can average the data. Obviously, a single salesperson talking to 20 prospects for 15 minutes each would require over 5 hours of talk time and would not be making as many dials.

If the overall bandwidth does not increase, individual salespeople are put under pressure to quickly “work through” the backlog of leads before they go “stale”. Nobody wants to have a large number of “Open”, “New” or “Unopened” leads next to their name in the CRM system. However, the salespeople can only make a limited number of calls in a day so they only try to reach each prospect once or twice before they move on. Best practices call for 5 to 8 call attempts, so while they make many calls, they have fewer timely conversations. As such, they don’t identify as many sales opportunities. Additionally, pressure to clear a backlog may result in less thought going into a customized sales pitch – again depressing the number of sales opportunities.

Even successful sales calls can result in fewer sales-qualified leads when there are more leads than sales bandwidth. Typical enterprise sales are complex. They require research, demos, evaluations, team selling, etc. so once an opportunity becomes “hot” the salesperson has less time to work on new opportunities. Because they have an opportunity in-hand and less time, their criteria to qualify new leads gets more stringent, again reducing the number of sales-qualified leads.

In conclusion, bandwidth is not just an issue for engineers to consider in their storage and data management products, it’s also an issue for the CEO, CMO and VP of Sales to consider when selling those products.

About the Author

David X. Lamont is an accomplished marketer of IT products and a partner at Marketingsage, a PR and lead generation firm that specializes in marketing data storage, data management, and enterprise software products. He can be reached by email at blog [at] marketingsage.net. Fellow marketers and IT professionals are invited to join his network on LinkedIn and to subscribe to this blog (see sidebar).

Summary: Marketing VPs and CEOs at data storage and data management firms can use these 5 techniques to generate more sales for the same budget by thinking strategically about how they allocate money.

I think it fair to say that most executives take a tactical, rather than a strategic, approach to the marketing budget. For the most part they take last year’s budget and adjust it up or down or they base it on a percentage of revenue. Then they apply the relatively small changes to their existing expenditures. Accordingly, firms set in motion a marketing program that may not provide them with any competitive advantage. And for most, that’s OK. It is good enough not to be at a competitive disadvantage.

However, it’s possible to gain a competitive advantage at budget time. By that, I mean a small sales-centric firm can “punch above its weight” and generate more sales for the same budget by thinking strategically about how it allocates money.

Strategic budgeting also makes it possible to overcome many of the B2B marketing challenges:

MarketingSherpa Marketing Research Chart:

A worthy goal is to maximize the funds that are applied to lead generation and lead management. What’s a lead? It’s not a web page visit, a click, or a rented list. A lead, according to Marketingsage’s definition is “a sales opportunity-related request with actionable contact information recorded by [you].” These actionable requests are reliably generated by paid promotions such as online advertising, trade shows and email campaigns, especially when supported by product-centric PR and highly selective participation in social media.

Another goal, for business with a resale or distribution channel, might be to increase the funds available for sales incentives directly tied to revenue. For example, paying market development funds to resellers only when they meet a set revenue objective.

Regardless of the promotion or incentive, strategic budgeting usually comes down to applying money to programs and campaigns that have a direct, or highly influential, impact on sales. So if your budget is not increasing, you are really making a decision to take funding from something or someone so you can apply the money to something or someone else that may have a greater impact on sales.

That’s why strategic budgeting is tough. Almost all marketing program and campaign will have their merits and supporters. However, the fact that it tough to do is also the reason why it’s possible for some to out perform peers with the same budget.

With that said, I’ll highlight my top 5 techniques for strategic budgeting.

Calculate What your Promotional Budget Should Be

When you have a revenue target, a lead-to-sale close rate, an average cost per lead and an average customer value you can estimate how many leads you’ll need and the required budget.

For example, if you pay the industry average of $60 for an information request type lead (e.g. white papers download), and your lead-to-sale close rate is 0.5%. You can calculate that you need 200 leads per sale and those leads will cost $12,000. If this year’s revenue target is $10-million and the average customer generates $100,000, you need 100 customers. The 20,000 leads you need for 100 customers will cost $1.2-million in promotions.

Of course, a happy customer can be expected to purchase more and the cost of incremental sales to existing customers will be far lower.

When you do this for the first time you may fund the numbers quite sobering. That’s not a bad thing because the strategic marketer will use this calculation to push back on unrealistic expectations and goals or to justify the appropriate budget for the targets set.

Adopt an Opportunity Cost Perspective

The average cost for an information request type lead (e.g. a white paper download) in the data storage industry is ~$60. As such, you’ll find it helpful to think of each $10,000 that is not spent on lead generation as 166 lost leads.  You can translate that into foregone revenue when you calculate your own close rate and expected average value of a customer – $83,000 using the above example (more if customers have a recurring value).

Thinking in terms of lost leads is very helpful when making judgment calls. For example, should you spend $60,000 to upgrade the trade show booth? Yes, if you think it will deliver a return greater than ~1000 leads – $500,000 in new revenue using the above example.

The same question can be applied to the purchase of marketing analytics tools, paid analyst relationships, promotional giveaways, internal sales meetings, custom creative, etc. If you are the CEO, you can apply this opportunity cost perspective when allocating budget to other departments, rather than to marketing.

Invest Early

If it takes an average of 3 months to convert a sales lead to a customer your fourth quarter promotions are driving next year’s revenue, not this year’s. Therefore a strategic marketer will invest almost everything early in the year to drive sales. Early sales success can be used to justify, and fund, the additional budget required to sustain the momentum later in the year.

Although the data storage and data management industry is not as seasonal as bathing suits and snow blowers, it does have some peaks and troughs that should be taken account. For example, summer months tend to be slower and government and educational customers purchase in cycles. Strategically it may make sense to execute the bulk of your lead generating promotions in the first 5 months of the year.

The word “execute” is important here because it takes 4 to 8 weeks to prepare most promotions – longer for trade shows. Add months and quarters if you need to hire staff, plan and/or build consensus.

Think Talent

Executing lead generating promotions on time with sufficient budget is paramount to success. Your ability to do this will depend on having the right skills at the right time. Therefore, strategic marketers think about talent before they decide whether to hire employees, agencies and/or contractors.

Your choices here are critical simply because talent is likely to be your largest single expense. Typically talent expenses, including payroll, annual analyst contracts, and agencies can consume 60% to 90% of a marketing budget so productivity gains can make a huge difference if savings can be directed into sales programs and lead generating campaigns.

Whether you can redirect savings from increased productivity depends on whether your talent expenses are fixed or discretionary. Payroll is essentially a fixed costs so sales-centric productivity is key. If an employee costing $150,000 per year is spending just 20% of their time on irrelevant tasks, you are effectively forfeiting $30,000 worth of leads. Using the above example, that’s 500 leads that could drive $250,000 in revenue.

On the other hand, outsourced talent is typically discretionary so you can use the services for what you want, when you want, for as long as you want. There usually very little, if any, “busy work.”

Therefore, the strategic marketer minimizes fixed expenses by keeping the number of employees to an absolute minimum and ensuring that the vast majority of everyone’s time is spent on activities that can impact sales. Many deliberately under-staff for 3 reasons:

  • Employees, and everyone who demands their time, are forced to prioritize.
  • To get everything done, tasks will need to be outsourced. Therefore the value and cost of the task will more visible and it will get more consideration (see note on the Opportunity Cost Perspective).
  • Discretionary budget can be more easily reallocated to sales programs.

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Of course every situation is different, but based on decades of experience I’ll offer this rule of thumb:

≤60% of the talent portion of the budget should be allocated to employee payroll, bonuses and benefits and tools (including the VP of Marketing). The most productive teams have experienced product marketers with deep knowledge of the products and industry.

Their job is to manage the day-to-day tasks that cannot or should not be managed by outside agencies. These include liaising with customers, vendors, technology partners, resale partners, salespeople and engineers. This interaction allows them to:

  • Define the strategy, budgets, and timing.
  • Define the product and company positioning.
  • Tee-up press announcements and the outsourced development of sales tools (case studies, brochures, video, etc.)
  • Make decisions about product pricing, sales programs and promotional investments (lead quality, the acceptable cost per lead, tactical placements, events, etc.)

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≥40% of the talent portion of the budget should be allocated to outsourced services such as PR, creative services, media buying, event management and strategic counsel – tasks that are performed better by people with broad media relationships, independent perspectives, and specialist skills. For most firms these tasks do not fill a 40 hour week and specialist skills, contacts and tools make it difficult to hire an effective do-it-all employee. Additionally, many of these tasks need to be executed simultaneously during certain periods of the year requiring bandwidth that just not available from a highly productive internal team.

A highly productive small tech firm marketing a B2B product like storage or data management software can compete using an experienced product-centric VP of marketing, a senior marketing manager, and one full service agency (like my PR and lead generation firm, Marketingsage 🙂

Such an organization would typically:

  • Run 20-25 simultaneous adverting campaigns, including creative, landing pages and lead capture.
  • Generate 10-12 press announcements per year and brief press/analysts each time.
  • Run quarterly reseller inventive programs.
  • Attend 6 or so domestic trade shows.
  • Run 8 to 12 prospect lead nurturing email campaigns.
  • Manage the process for 4 or so interoperability certifications.
  • Author and layout 4 or so white papers.
  • Author and layout 6 or so case studies.
  • Produce 20 minutes worth of videos.
  • Maintain the web site.
  • Maintain a corporate blog.
  • Selectively participate in sales-centric social media discussions.

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Fast, Good, Cheap

You’ve heard the saying: You can have it fast, good or cheap. Pick any 2. For a marketer at a small firm in the storage and data management sector the priority is clear:  Fast and good (enough). Cheap is not the strategic option, even for a cost conscious marketer. Here’s why:

Time is your enemy. The market is highly competitive so a better or less expensive product will emerge soon – maybe before you see an ROI on your current development efforts. This could leave you at a competitive disadvantage with unsold inventory, depressed margins and higher promotional costs.  Additionally, if your firm does not yet have a positive cash flow, time is burning up your available capital. Ask the CFO what’s preferable: spending an extra 20% on an agency that can execute now; or burning 3 months of expenses for the whole company while you go through a hiring or orientation process.

Obviously fast and bad will not win you customers. However, don’t let perfect become the enemy of good enough. Good enough is faster and less expensive than perfect. You’re in the B2B IT market, not the fashion market, so let your competitors waste time and money on custom art, billboards, golf sponsorships, and chotskies while you deliver what prospects want – timely information that helps them choose your product over the alternatives!

About the Author

David X. Lamont is an accomplished marketer of IT products and a partner at Marketingsage, a PR and lead generation firm that specializes in marketing data storage, data management, and enterprise software products. He can be reached by email at blog [at] marketingsage.net. Fellow marketers and IT professionals are invited to join his network on LinkedIn and to subscribe to this blog (see sidebar).

I go to Oracle OpenWorld (OOW) in San Francisco every year because my PR and lead gen. firm, Marketingsage, helps data storage and data management firms market to the large enterprises that use Oracle.  Wednesday Oct. 5 was my day to visit the 2011 expo and this post takes a marketer’s look at the exhibits of some of the most innovative firms who were showing off their high performance storage hardware at the show.

This was the last day of the expo so you might expect it to be somewhat quiet. In my opinion is was far too quiet at any booth that was not front and center in the main hall or giving way a car, iPad, iPhone 5 4S. While that may be bad for exhibitors, it was good me because I got to see most of the high performance storage players. Besides the big guys like Oracle, EMC, HP and Dell, there were more start-up firms this year. Most of them paid big bucks for big booths.

I’ll give the award for biggest-bang-for-the-buck to our friends at GridIron Systems. They did not have a booth. They used a high traffic station in the highly visible Intel booth to show off their TurboCharger caching appliance. This device fit right in with Oracle’s “Big Data” theme because it accelerates (in real-time) the “hot data” that’s in-demand. Users do not have to put their Oracle database, or even the tables, onto expensive solid state disk (SSD) to get SSD performance. That makes the GridIron hardware somewhat special in the value-for-money department. I know all that because Marketingsage just started helping GridIron with its PR 🙂

Start-up, Pure Storage had a big bright booth and lots of people wearing their distinctive shirts. They also scored a visible spot in the Samsung booth. Their solid state disk is special because it uses real-time deduplication and compression to reduce the amount of data that’s actually stored on more expensive SSD. Therefore, they claim the cost of their system (when available) will be lower than purchasing hard disk drive-based systems for the same volume of data.

Fusion-io had the most visually impressive information walls backed by a mini data center. They also had some pro-active salespeople willing to grab passersby. I can respect that. Fusion was touting “a tier on a PCIe card” and they are getting some impressive Flash capacities on relatively small cards. The other vendors went out of their way to point out that this PCIe-based storage is not shareable.

STEC had a front row booth in the corner of the main hall. They had a small theater where they did a good job introducing their rather large Kronos PCIe card. They subsequently gave out t-shirts to those who filled in their sales lead survey. Customers can use a single STEC Flash drive to replace a hard drive in a server or they can array them for rack mounted enterprise environments.

Violin Memory also stumped for a big front row booth. Interestingly they only used half of the booth for meeting attendees. The other half was hidden and off-limits. Violin prefers to call its SAN-attached SSDs “memory arrays” and they see them as primary storage to be used in an “all silicon data center” without hard disk drives. Meanwhile, Quantum was at the back of the same hall proving that tape is still an important part of today’s data centers. I was impressed  by Quantum’s high performance StorNext system. It’s used to quickly ingest and provide shared access to REALLY BIG files, like satellite and geology images, and manages all of the storage complexity of  managing and archiving to hard disk or tape.

Our friends at TMS exhibited their SSDs at OOW years before some of the other SSD firms even existed. They had their usual spot in the middle of the main hall. And as usual, you could be standing next to the booth and not notice it. However, Oracle users seek them out. TMS had a small theater where their genuine Oracle Guru talked to Oracle users and developers about how to accelerate Oracle. TMS does not confuse OOW with SNW (Storage Networking World) and their no frill SSDs are always fast.

I went all the way across the road to see Kaminario in the lower traffic West hall. They had a small 10×10 pop-up booth, but they were getting their share of visitors. They probably deserve the runner-up prize for the biggest-bang-for-the-buck booth among SSD vendors. Kaminaro’s SAN-attached SSD lets customers choose DRAM and/or Fision-io’s Flash memory.

Nimbus Data Systems was at the show as well, but their small booth looked like a parking space. It was 80% sports car, 20% SSD. No, you could not win the car. I was laughingly told by another vendor you could win the privilege of sitting in it for a while.

We would have liked to seen WhipTail, SolidFire, Nimble Storage  and some of the other serious vendors of high performance enterprise storage systems. Alas, they were not at this particular show.

Other SSD Posts

If you like to read about the marketing of SSDs you can join the mail list for this blog (top left sidebar). You’ll get an email when a new post comes on line. Here are some recent SSD related posts:

Storage start-ups: What CEOs, VPs and VCs should know about the honeymoon period

A Strategic Marketing View of Flash Memory Products

About the Author

David X. Lamont is an accomplished marketer of IT products and a partner at Marketingsage, a PR and lead generation firm that specializes in marketing data storage, data management and enterprise software products. He can be reached by email at blog [at] marketingsage.net. Fellow marketers and IT professionals are invited to join his network on LinkedIn and to subscribe to this blog (see sidebar).