A recent report from PricewaterhouseCoopers suggests the decision-makers behind IT purchases cling to a well-worn sales maxim: don’t call us, we’ll call you.
The report, based on survey results from 182 CEOs of Canadian
software companies with $2 – $5 million in annual revenue and 307 senior IT directors, said that cold calls often receive the cold shoulder.
There’s a disconnect between the two groups, says Susan Allen, leader of PwC Canada’s emerging company practice. Canadian ISVs still rely on phone sales, but according to the PwC report, buyers favour trade magazine ads and e-mail pitches even over RFPs.
“”Unfortunately, e-mails and trade publications are the method least used by software companies to initialize a sale and make contact with new customers,”” the report says. “”Our surveys show that software solution vendors prefer to make cold calls and use customer references to gain new business. . . .””
“”Well the CIOs came back and said, ‘Well, those are the least preferred methods. We don’t like to be approached via cold call,'”” adds Allen. “”‘We actually prefer the hard copy mail or e-mail or ads in trade publications. We go to information seminars, we read white papers — anything but cold calls.'””
Allen said that marketing is one of the main challenges currently facing Canadian software firms. Not only are they using the wrong medium to deliver their messages, they’re often addressing the wrong person. ISVs tend to overvalue the role of the CEO when it comes to purchasing power. It’s more likely that a CIO or CTO would be the one to approve IT purchases, she says.
According to the senior IT managers surveyed by PwC, CIOs and CTOs are responsible for purchases 49 per cent of the time. It’s a different story with other C-level executives: CEOs — 22 per cent, CFOs — 12 per cent, and COOs — only six per cent of the time.
However, Canadian ISVs are aware that marketing and expanding into new geographic markets will be key to their success and longevity, says Allen.
“”They see themselves as international marketers from Day 1, and they really have this global perception that (they’ve) got to sell into the international market, not just Canada,”” she says.
“”It’s not the best technology that will win out there. The problem with small companies is that you get a great innovator (who) fails on the marketing,”” said Stefanos Lialias, the CEO of Toronto-based wireless software firm Digital Speed, which specializes in mobile solutions for the health-care market.
Lialias has had some success in Canada, but ultimately sees the U.S. as his primary focus, where there are more opportunities, shorter sales cycles and more market recognition, he says.