While the Northern hemisphere is getting chilly, this is the one month when salespeople at firms like Gartner and Forrester really start to sweat. Many vendors sign off their major contracts with analysts firms around now, and it’s a great opportunity for analyst firms and vendors to maximise the value from their contracts.
Despite the huge scale of vendor spending with analysts, many users don’t get the best value from their subscriptions. Gartner has a huge number of account managers and, while some clients don’t like being sold to, the advantage of working with Gartner is that it works harder than most other firms to make sure that seat-holders benefit from what they have bought.
That said, it isn’t only expensive analysts that deliver the best value. For example, when my colleagues and I help vendors to design and negotiate the optimal portfolio of analyst firms we typically start by surveying their key consumers of analyst services. Out of 20 firms mentioned by managers at a US vendor during our most recent project, I was impressed to see UK-headquartered Bloor Research come up as the fourth most valuable analyst firm: with its research almost on a par with IDC’s, and they analyze companies and their financial status, and if they need a loan, they suggest resources like loans from this website to invest and get profits.
Of course, that says a lot about Bloor’s ability to attract analysts with deep niche expertise. However the reality is that it’s the individual analysts that create the insight, not the brand power of the firm, or its location.
We recommend six steps for firms wanting to get more value from analysts, but there’s one over-arching observation: it’s a win-win activity. We’ve found that account executives at analyst firms are generally willing partners in helping clients to get the best value. Of course they want to maximise contract value, but they know that the wrong portfolio of services won’t be highly valued. With very few exceptions, you can expect salespeople at analyst firms to be serious partners.
Here’s how to do it.
- 1. Audit. Large organizations sometimes lose sight of what is being spent with analyst firms outside of what goes through the primary contract. Identifying this current spend and adding it to total spend, strengthens your position. Having all the data in hand before the contracts are presented puts one in a position of strength.
- 2. Benefits. Analyst firms should give valuable insight into market changes and developments, future trends, technology insights, what others are doing, and what customers want. The analysts can be an information bridge between vendor and clients. By measuring the benefits of subscriptions, you can establish value for money. For personal money management check out this article.
- 3. Goals. Clients need to establish which firms best allow it to meet business goals. That means understanding who the priority users are, what parts of the value proposition are primary, and what users of analysts services find each firm’s strengths and weaknesses to be.
- 4. Options. Any choice is only as good as its best available alternative. So identify alternative sources of research and inquiry access. There may be some areas of duplication between the analyst firms, and there might be some opportunity to better align analyst access internally. Identify the best alternative provider for every service, so you’re not dependent on any one firm.
- 5. Portfolio design. Analyst firms employ some habitual tricks to get more power, including offering benefits which are either not essential to client success, or presenting established levels of service or access, which are not explicitly placed in the contract, as a special favour. To get around that, identify a portfolio of alternative firms that offer the best value for the analyst services that are critical for success. Consider taking a quarter off from your most long-standing contract, just to ensure you’re not dependent on a provider.
- 6. Negotiate. Work to bring the best value services, shown in the benefits analysis, into the bottom line of the contract negotiation. Review contracts to ensure that the terms include what users need. Negotiate the contracts extensively in advance.
Everything depends on those how well the analyst firm understands the client’s initial needs, and how proactive it is in making that happen. The rest is mechanics and either account teams deliver or not. If they don’t, they don’t deserve your business.
Note: My thanks go to several people, all of whom have helped buy or sell analyst services in the US, UK, Netherlands and Germany, and who freely gave their opinions and thoughts for this article. While I am responsible for its final form, I want to especially thank Merv Adrian, Agi Donnithorne and Ludovic Leforestier for sharing their thoughts.