Bloor Research is back, big time, with new leadership and a Cunning Plan.
A long conversation with Bloor Research’s CEO, Justin Speake, and founder Robin Bloor left me wondering whether it will work. What’s not in doubt is that these people have the vision and the operational skills to get the ball rolling.
Justin’s team came into Bloor after its receivership last year to help lead a purchase of the firm which left him, and all the surviving staff, owning the firm and its resources. With £100,000 down, they found themselves owning one of the best known and most loved IT analysis brands in Europe and two of the best read tech websites: IT-director.com and IT-analysis.com. Founder Robin Bloor, now Austin-based, is combining his work as a partner with US firm Hurwitz [1] with a continuing relationship with [and equity stake in] Bloor Research, which is set to maintain its European focus. Robin will continues to mentor and advise the Bloor Research team.
Speake and a team of outside business people have taken the company through a profound transformation – and I feel there is much more significant news ahead from these entrepreneurs.
At the core of the new Bloor Research is the idea that the existing analyst industry gives poor value and that it fails to add value. End-users need concise information about what’s available; vendors want it distributed. The firm is extending the range of material it has available for users, partly through an expanding range of alliances.
Justin and Robin think the market for analyst research is not only constrained by high prices, but also that this leads to unsustainably low value. They see a substantial gap between management consultancies like McKinsey & Company, which focus on business needs and strategies, and services providers, like Accenture, who enable and implement technology plans. Bloor Research wants to help end-users and vendors to more easily make decisions, compare technologies and decide on product and supplier directions.
They suspect that lower prices would stimulate demand to such a degree that overall revenue could grow substantially. To stimulate this greater demand, research needs to be presented differently. Analysts synthesise information, but now need to do that at different lengths and in different forms. To take Robin’s phrase, “the price per achieved piece of knowledge” will fall but, so long as the work continues to be of recognisable quality, the value extracted will be greater.
However, the key issues are adoption and profitability. Economic research suggests that the price elasticity of business services is normal: for example, that means that a 1% decrease in price increases demand by 1%. That leaves revenue the same, but reduces profits by the cost of the effort taken to make and fulfil the extra sales. The ‘old’ Bloor Research went below Gartner and some other firms on price – but failed to grow sustainable profitability (not only despite the lower price but, perhaps, because of it).
If they are right, and they can present research over a broader range than before, which is more easily used, and which is of the same or higher quality than before, then they should be able to show higher value – and therefore justify higher pricing.
The new Bloor Research has given serious thought to these economics risks, but it remains confident that the opportunity exists to double their business using the new strategy. They can get the ball rolling, but the market will decide whether it gets momentum – and whether Bloor Research’s new owners will be rewarded.
[1] P.S. Thanks to Efrem Mallach for pointing out that we should mention that Hurwitz bought out the US Baroudi-Bloor venture at the beginning of this year.
Not sure that Robin wants to trumpet his association with Hurwitz. Another failed ‘pay per view’ vendor.