In one scene of ‘What Women Want‘, a recovering chauvinist advises a colleague about her relationship: “I mean, you’re either interesting or you’re not. Ask him to decide.” The same dilemma, and same guidance, faces managers who invite analysts to briefing events and get invoices in return. AR professionals need to push back against firms that want to bill vendors for attending briefings. Paying analysts for briefings undermines analysts’ abilities to advise their clients, and produces clear ethical issues for vendors and analyst firms.
Unlike advisory days (in which insight flows mainly from the analyst to the vendor), the flow of information at a briefing is primarily from the vendor to the analyst. If the vendor’s information is relevant to the analyst’s research, and the vendor is significant to merit enough attention to justify attending the briefing, then an analyst should be there whether or not the vendor is a client, let alone whether or not the vendor pays extra. Analysts need to allocate their time in line with their clients’ interests. If a vendor isn’t interesting to the analyst (or to their clients), then it’s a waste of the analyst’s time and the vendor’s money to bring the analyst in.
Instead the vendor should be focussed on seeing if there’s other information that’s more relevant to the analyst that is not on offer at the briefing (perhaps the vendor is relevant, but the analysts doesn’t expect valuable information) or if the analyst should lower down on their ranking.
Analyst firms place themselves in difficult positions when they attempt to bill clients for meetings that they would not charge non-clients to attend.
- They are penalizing clients for being clients and rewarding non-clients: that acts against their long-term interests.
- Furthermore by not attending the events of vendor clients who cannot justify paying for briefings, they erode their relationships with vendor clients and make the value of the relationship less clear.
- A deeper challenge is presented when the firm refuses to attend the briefing unless it is paid. It sets up a clear indication that vendors that are clients of analysts are written about more: that should make other clients skeptical that the research analysts produce is independent of their commercial relationships (In particular, end-user clients will become skeptical about the independence of an analyst firm that only needs vendors who pay).
PS I’ve expanded this post (with the text in brackets).