Control in Analyst Attitude Surveys

Because a lot of analysts take part in our Analyst Attitude Surveys, we are able to offer clients what we call a control group. In the language of research, a control group is a group of people who don’t get the treatment that we want to measure the effectiveness of. For example, most firms might be focussed on a top tier of analysts, whom they treat very differently. Of course, those are not the only analysts. Using a control group helps us see the difference being produced by the treatment we are studying.

Most firms focus the majority of their analyst relations effort on a small number of industry analysts whom they hope are the most influential. That’s a necessary risk because very few firms are able to both reach out to many analysts and do so frequently. Some firms reach out to many analysts, but infrequently: That’s a common choice for firms headquartered in the Far East. Other firms reach out to very few analysts, but with very deep relationship-building: that is frequently the strategy of firms headquartered in mainland Europe. Any of these combinations produces a risk: what is the changing impact of the analysts who, despite being under-informed, are still giving their opinion about your firm and its competitors?

In our surveys, we separate out the analysts whom each client targets from the others. That’s harder than it sounds, because not every firm really knows the total communication volume with each analyst, and often the analysts who are formally the top tier are not the ones who get the best treatment. If clients don’t have a reliable target list, our data shows us which analysts are communicated with the most by that firm and its peers. As a result, the analysts responses themselves reveal the targets more effectively than some AR teams can do.

This is a unique benefit of our approach, which is a retrospective cohort study. It’s retrospective for two reasons. Firstly, because our six-monthly cycle allows us to show how opinions have changed. Secondly, because we are separating the targets from the control group at the time of the study rather than first separating the analysts and then working for six months before we survey them. Our approach allows rich feedback, quite quickly.

Our clients often have a great grasp of the best analysts in their market. They often think the analysts they target are the only ones that matter. Sadly, that’s not the case. Our Analyst Value Survey, launched in 2002, gathers the views of several hundred users of analyst firms each year. It shows not only that professionals are using more analyst firms than before but also that upstart firms are growing in influence (especially on Line of Business managers outside the IT function). We have no trouble getting a meaningful control group, not only because of our use of Panalyst and ARchitect Express, but also because no firm (not even IBM or Cisco) can build deep relationships with every analyst.

In practice, the target group is easy to find: either the clients know their targets or the analysts’ responses identify them. The other valid responses to the survey make up the control group.

The value of the control group is multiplied by the regular rhythm of the study. We are able to show the difference produced by your analyst relations by looking at the gap between the responses of those two groups. By comparing them historically, we are able to show whether your or competitors are moving backwards or forwards.

As you will have guessed, clients with the AVS are able to get even more perspective. We are able to weight the responses of each analyst by their firm’s value to enterprises, SMEs or both. That can give a powerful insight into whether your analyst relations is winning you ears, or also market impact.

If you’re interested in the AVS, we have a webinar on May 31st to run through some highlights of the last study. Contact Viktoria Reis or Stacey Alexander for a seat.

Duncan Chapple

Duncan Chapple is the preeminent consultant on optimising international analyst relations and the value created by analyst firms. As SageCircle research director, Chapple directs programs that assess and increase the business value of relationships with industry analysts and sourcing advisors.