Bottom Line Top Line

Volume 11 - October 2005


	Marketing Best Practices 2005

With most of the prominent multinational vendors already in town, the offshore advantage has today ceased to become the prerogative of Indian IT companies. No longer do Indian vendors have the luxury of their lower costs ushering in revenues. Rather, they are finding out (often the hard way) that investments in marketing and branding have become essential in view of the intense competition in the marketplace. Marketing can no longer be relegated away as an ancillary task. Incidentally, marketing today features amongst the top priorities for Indian vendors and as Prayag’s second annual marketing best practices research discovered, marketing and branding priorities have evolved considerably to figure as a high organizational priority.

Prayag’s second annual marketing study, aimed at evaluating marketing practices across technology companies with an offshore model, is one of its kind in the industry. The responses from participating companies far exceeded our expectations; the study included responses from companies across the breadth of the IT and BPO industry. The highlight of the study is that it provides an insight as to how marketing activities have evolved over time, and how these differ across the varying categories of players.

Profile of Respondents
< $10 Million	45%
<$10 -$100Million	25%
$100-$500 Million	19%
$500 Million -$1 Billion	7%
$1 Billion+	4%

All respondents to the study were categorized on the basis of revenues and service lines. The respondents were CEO’s, CMO’s, and VP’s of Marketing. The combined revenues of respondents to the study amounted to over $20 billion.

Respondents by revenue
Respondent Category	Combined Revenues ($ Million)
< $10 Million	$83.25 Million
<$10 -$100Million	$401 Million
$100-$500 Million	$2094 Million
$500 Million -$1 Billion	$750 Million
$1 Billion+	$17.95 Billion
Total	$21.29 Billion

The Marketing Practices study evaluated the marketing activity along three lines. The study primarily sought to evaluate prioritization of marketing practices across organizations and how marketing priorities had evolved over the last year. Here again, it sought to identify the key marketing thrust areas and compared them vis-à-vis the current focus of marketing initiatives.

Another area of focus for the Marketing Practices research revolved around how well companies leveraged the use of technology in their marketing initiatives. Here again, we evaluated the prevalence of online and web based marketing initiatives employed by respondents in their overall marketing efforts. Additionally, the Marketing Practices Study also focused on the use of metrics in measuring the effectiveness of marketing initiatives.

One of the key findings of the study is that Indian companies are finally waking up to the importance of the brand. Branding has emerged the key marketing priority for IT and BPO vendors across the spectrum. As many as 58% of the respondents considered branding their top most marketing priority as compared to 33% the year before. This focus on brand building initiatives was more pronounced amongst mid sized companies.

With respect to the use of technology in marketing initiatives, it was discovered that respondents have become savvier. While email continued to be the preferred means for online marketing initiatives, respondents were increasingly found to employ technology including web tracking and S&M KM systems to augment the success of their marketing initiatives.

With marketing becoming a key priority and expectations going up on marketing departments to deliver results, one would expect a widespread use of metrics to track effectiveness of marketing initiatives. Paradoxically enough, less than half the respondents had a robust mechanism to track and evaluate the effectiveness of their marketing programs. While there is some use of metrics to evaluate the effectiveness of marketing programs, there remains substantial scope for improvement in this respect.